Padang Meha’s continuing saga

The long suffering ex-workers of Padang Meha Estate are once again being “assaulted” by one of the subsidiaries of MBF Holdings Bhd (MBF) – this has been a recurrent theme for the past 28 years! The latest episode of this saga began in January this year when Vintage Developers Sdn Bhd, the fully owned subsidiary of MBF, announced its intention to evict the 30 ex-workers who were then still occupying the old estate quarters.

These 30 workers comprised of 2 distinct groups. About half of them were part of a group of 135 ex-workers who in 2017 engaged the legal firm Hakem Arabi, to demand payment of the retrenchment benefits that their former employer, East Asiatic Company, had passed to MBF Holdings in 1995 when MBF bought this estate. That was a sum of RM 3.36 million and until then (2017) not a cent had been paid to the 207 retrenched workers.

In Court, MBF first said that this sum of money had been held by another fully owned subsidiary, Alamanda under which this estate had been “parked”, and that the entire sum was lost when Alamanda was wound up in 2004*. But the fortunes smiled on the workers then. The liquidators for Alamanda, one of the parties named in the suit filed by Hakem Arabi, had filed papers in their Statement of Defense that proved that the RM 3.36 million transferred by EAC to MBF in 1995 had never been passed to Alamanda but remained under the stewardship of MBF itself.

The lawyers for MBF then argued that the Statute of Limitations that limits the term of contractual liabilities to 6 years, had long been exceeded, and that MBF did not have pay anything to the workers. Hakem Arabi argued, quite creatively, that the RM 3.36 million was more in the nature of a “Trust” and that Trusts do not come under the ambit of the Statute of Limitations. In April 2019, the Appeal Court agreed with Hakem Arabi and ordered that the entire sum of RM 3.36 million be handed over to Hakem Arabi for distribution to the workers based on the detailed list prepared by East Asiatic Company that specified the exact amounts to be paid for each of the 207 workers based on duration of service and whether it was a single person or a husband and wife pair.

MBF could have allowed the issue to resolve at that point. But instead MBF appealed to the Federal Court arguing that as Hakem Arabi was only representing 135 workers, MBF only needs to transmit that portion of the RM 3.36 million that related to these 135. A Consent Agreement was reached in February 2020 whereby MBF transferred RM 1.5 million to Hakem Arabi for payment to these 135 ex-workers. The agreement also specified that if, after 6 months of transfer of the compensation money to Hakem Arabi, the worker had not moved out, MBF could apply for a Court Order to evict that worker.

At a meeting with the ex-workers in January 2023, it was decided that those from the 135 who had been represented by Hakem Arabi should move out and collect their compensation money. But those among the 72 ex-workers (Team B) who were not on Hakem Arabi’s list and whose compensation was still being held by MBF, decided that they would not vacate their homes until their compensation amounts were also settled. They had sent several letters to MBF between 2020 and 2023 asking that this be done, but there had been no response.

In March 2023, Vintage Developers, who had bought the property after Alamanda was wound up, attempted to evict the “Team B” workers. These workers then appealed to a group of lawyers, who had helped in their earlier struggle with Alamanda. M/s Theiva Lingam filed an application under CPC 99 to preserve the status quo until the issues involving the land were resolved. This was granted by the Kulim Majistrates Court on 19/3/23.

Vintage Developer’s Lawyer, Messrs Calvin Khoo, then filed an Order 89 application for summary eviction of more than 50 team B ex-workers as they were, he claimed, “illegal squatters”. This application of course failed, as these were not people who had encroached on the land after it was bought by MBF, but were ex-workers who had yet to be paid their just compensation. In a curious twist towards the end of the Order 89 trial, Messrs Calvin Khoo, expunged the names of more than 40 workers it had named. Thus, when the decision of the Sg Petani High Court was announced in September 2023, rejecting Vintage’s Order 89 application, less than 10 names of team B were specified in the judgement.

However, at the same time, unknown to the lawyers for the team B ex-workers, Messrs Calvin Khoo used the Federal Court Judgement of 2020 to obtain an ex-parte order from the Sg Petani High Court allowing Vintage to evict any of the 135 workers represented by Hakem Arabi as well as any other unnamed workers still occupying estate quarters. It is indeed curious that the Court Official granting this ex-parte order did not investigate the matter a little more closely. For if a little effort had been made – all the relevant documents had been filed in the Order 89 application – it would have been clear that the Federal Court Order is only applicable to the 135 who had received their compensation and cannot be used against the team B ex-workers who were not part of that case. However, Messrs Calvin Khoo’s misrepresentation of the situation was not discerned by the Court and the Eviction Order was duly granted to Vintage.

Vintage descended on the estate quarters on 18/12/23 armed with this court order and accompanied by the Court Baliff, and despite the resistance of the ex-workers, managed to demolish 4 houses in Division 2 where the resident families are. M/s Theiva Lingam are now working frantically on an injunction to stop the eviction of team B workers and the demolition of any more quarters because that would release more asbestos dust that can cause cancer in the resident team B workers and their families.

Isn’t this disgraceful conduct on the part of a rich company sitting on several hundred acres of prime land worth tens of million ringgit in development value? Why is this happening in a country claiming to be on the threshold of “advanced country” status? Paying the team B workers their compensation as specified by EAC 28 years ago would only come up to about 2 million ringgit. And the problem which has festered on for 28 years would be resolved. It would not be a just resolution, as the initial promise of a terrace house for each family has not been met, (and probably will never be), but it would bring some closure.

And the conduct of the legal firms aiding and abetting MBF and Vintage Developers in their abusive treatment of the ex-workers of Padang Meha raises pertinent moral issues – to what extent should lawyers use subterfuge and misrepresentation to enable their rich business clients to avoid their basic obligations to the communities they disrupt in their pursuit of profits?

And what happened to the system of checks and balances that are supposed to be in place? Sure, this is private land. But there is an Estate Land Board in every State which is supposed to oversee the welfare of estate workers affected by sale and fragmentation of their estate. This is specified under Section 214(A) of the National Land Code. What were the recommendations of this Board in the mid 1990s regarding the welfare of the Pdg Meha workers? Did the Board meet to deliberate and give recommendations? Were they implemented? We have sent letters to the Kedah State Government requesting details of these recommendations but have been met with silence.

The fact that the cooperation of the State Government and the Local Council is crucial for the timely approval of the development plans, present State and Local authorities an avenue to influence developers. These 2 levels of government can exert significant pressure on errant developers to toe the line with regards to compensation of displaced communities and maintenance of the environment. In the case of Padang Meha, these 2 levels of Government have been markedly reluctant to use their considerable powers of “persuasion” to defend the interest of this community of maligned ex-workers. And it is not ethnic bias – about 50% of the ex-workers are Malay. It is more to do with “ketuanan wang”.

All this underlines the fact that in Malaysia today, the interests of the corporate class are prioritized over the basic rights of the ordinary citizen and highlights the need for more peoples’ organisations and networks that can stand in solidarity with ordinary people who are displaced by “development”, bullied by wealthy companies, neglected by government bodies entrusted to look out for them and “outfoxed” within the legal system by well paid legal firms.

Join us. We need more hands on deck!

Jeyakumar Devaraj
Parti Sosialis Malaysia

19 December 2023


  • Alamanda had initially attempted to evict the workers through a court action, but later agreed to build them terrace houses and sell them to each family at RM 12,500 (Half price at that time). However this promise was never initiated and in 2003, the 5th year after the promise, the workers filed a case against Alamanda, with a team of lawyers then associated with CAP, to make good it’s promises. Alamanda got wound up soon after that. So, despite the fact the ex-workers won that case, and the Court awarded RM 22,500 per worker as compensation for failure to provide a low cost house, nothing was actually paid to any worker, as the company was wound up.

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