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Collateral Attack – Dato Sri Mohd Najib Bin Hj Abd Razak v Ambank Islamic Bank Berhad & 2 Ors (Court of Appeal)

7th April 2022

The concept of a civil suit being a collateral attack on a criminal action was considered by the Court of Appeal recently.

The Appellant, the former Prime Minster of Malaysia, filed his claim in the High Court on 9.12.2019 against Ambank Islamic Bank Berhad, its holding company (AMMB Holdings Berhad) and the relationship manager of the Bank.

The Appellant alleged in his claim that the Defendants had breached various duties owed to the Appellant regarding the operation of the Appellant’s current accounts with the Bank (“the Accounts”). Allegations were also made that the Bank and its holding company ought to be liable for the actions of the relationship manager for what was alleged to be unauthorized transactions done under the Accounts without his knowledge.

This civil claim was filed in the midst of the Appellant defending the widely-publicised criminal action in connection with monies belonging to a government-linked company, SRC International Sdn Bhd (“SRC Proceedings”).

The Appellant alleged that he had suffered damage, loss of reputation, distress and loss of his position in the Malaysian political setting as a result of the ongoing SRC Proceedings, which he alleged had been caused by the actions of the Defendants.

On 28.9.2020, the High Court allowed the striking out applications filed by each of the Defendants. By this time, the Appellant had already been found guilty of the charges in the SRC Proceedings and found by the criminal court to have had knowledge of the transactions in his Accounts with the Bank.

The Appellant appealed to the Court of Appeal against the striking out decisions of the High Court.  The appeal was heard over two days.

Recently, the Court of Appeal delivered its unanimous decision and dismissed the Appellant’s appeal with costs. In the brief grounds given, the Court of Appeal agreed with the High Court and held, inter alia, that the criminal charges suffered by the Appellant could not be attributable to or caused by the Defendants, as the instituting of criminal charges under the SRC Proceedings were matters within the sole and unfettered discretion of the Attorney General.

The Court of Appeal further held that what was essential in both the SRC Proceedings and the present civil suit by the Appellant was whether the Appellant knew how his bank Accounts were conducted. As the criminal court already found that the Appellant had knowledge of his Accounts and such finding was upheld by the Court of Appeal under the appeal against his conviction, the issues in the SRC Proceedings and the Appellant’s civil claim concerning such knowledge are similar. It was thus held that the Appellant in seeking to proceed with his civil suit clearly intended to undermine the findings made in the SRC Proceedings. The Court of Appeal fully agreed with the High Court’s decision that the Appellant’s claim herein was in fact a collateral attack against the findings and decision made in the SRC Proceedings and that the civil suit was an abuse of the Court’s process.

This is the first time an appellate court in Malaysia has considered whether a civil suit ought to be struck out for being an attempt to undermine the findings of a criminal court.

Our Ms Yoong Sin Min, Mr Samuel Tan and Mr Sanjiv Naddan represented the Bank and AMMB Holdings Berhad.

The article is intended for general information. It should not be regarded as legal professional advice.  If you need advice based on specific facts, please do contact our firm.