KOTA KINABALU: The COVID-19 (“Covid”) pandemic has already had a significant, detrimental effect on the nation’s economy.
The full effects of the same have however yet to be felt. One consequence of Covid and the consequent Restricted Movement Order which took effect on 18.03.2020 (“RMO”) is that many parties will be unable to fulfil their obligations – whether contractual, statutory or otherwise – during or even after the tenure of the RMO.
In a statement the Sabah Law Society (“SLS”) foresees that there will be a sharp increase in litigation concerning issues surrounding the RMO and the failure of parties to fulfil their obligations.
It’s president Roger Chin said litigation will arise out of the many legal uncertainties surrounding the RMO and its legal effect on contractual, statutory or other obligations.
He said litigation is ordinarily commonplace in any healthy economy, the SLS is of the view that at this critical juncture, the time and resources spent in resolving such disputes would be better invested in rebuilding the nation’s economy rather than through potentially protracted litigation.
“Every single breach of obligations related to Covid or the RMO which cannot be resolved amicably between the parties is potentially a lawsuit that could take years and thousands of Ringgit to resolve,” he said.
This will not only be detrimental to the individuals involved, but will also increase the uncertainty in the economy generally, as parties will not know for sure where they stand until the litigation is finally resolved, he opined.
A solution to the above is for the government to legislate on issues arising out of Covid or the RMO. In view of this, the SLS would call on the government to enact legislation on an urgent basis to address the said issues and ameliorate the negative economic impact of Covid and the RMO. Provision for the same may be made via a single Act of Parliament and/or State Enactment (where applicable), which for the purposes of this press statement will be called the Covid Measures Act (“CMA”).
Although it will not be possible to cater to the requirements of every case, the SLS would propose the following general provisions, which it believes will be of significant benefit to the public at large:
1. An extension of time under the CMA is not automatic, but relevant obligations (including periods of limitation) shall be suspended for the period of 28 days – or for such longer period should the RMO be further extended – upon notice by one party to all affected parties invoking the CMA.
2. The obligations shall only be suspended and the party giving notice shall remain obliged to perform the same on the stipulated date plus 28 days (or for such longer period should the RMO be further extended).
3. In order for an obligation to be relevant, performance of the same must be due on or after 18.03.2020, and until such time that the relevant Minister prescribes.
4. Relevant obligations include contractual obligations and deadlines prescribed by any statute or subsidiary legislation or rules, whether State or Federal.
5. The relevant Minister may prescribe specific categories of obligations that are or are not subject to the CMA.
6. The right to invoke an extension of time under the CMA may be waived either expressly or by conduct, i.e. performance.
7. An extension of time under the CMA may be invoked even after the time for performance of the same has lapsed. An extension of time claimed under the CMA shall not however void any termination of contract if the said termination is effected prior to receipt of the notice invoking the CMA.
8. Invoking an extension of time under the CMA does not preclude a party from subsequently invoking principles of frustration or res judicata.
9. The formation of a Panel which shall have exclusive jurisdiction to expeditiously decide on all issues arising out of the CMA (“CMAP”).
10. Any party dissatisfied with an asserted extension of time under the CMA may challenge the same within 14 days from receipt of the same to the Panel.
11. The Panel shall, after giving parties the chance to be heard, determine whether or not the asserted extension of time under the CMA is valid.
12. The decision of the CMAP shall be final and binding on the parties and not subject to appeal or judicial review, in the absence of corruption, fraud or similar events.
13. Parties in references to the CMAP shall not be represented by an advocate.
The SLS is ready, willing and able to assist the government in the drafting of the proposed legislation if called upon, Chin elaborated.-pr/BNN
