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Issue #37/2022
15 September 2022
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CASE(S) OF THE WEEK
DATO' SERI TIMOR SHAH RAFIQ v. NAUTILUS TUG & TOWAGE SDN BHD [2022] 8 CLJ 529 Proper corporate governance requires the keeping of proper accounting records of the company pursuant to the Companies Act 2016. The minority directors were reasonable in their pursuit of leave to commence a derivative action against the majority directors, who were holding the management and control of the company, and who had failed to shed light on the substantial amounts advanced. An application for leave to commence a derivative action is subject to satisfaction of the threshold that the action is commenced in good faith and prima facie in the best interest of the company; there was no necessity to show that the action was bound to succeed. COMPANY LAW: Derivative action - Action taken by minority shareholders - Payment of shareholders' interest not substantiated by relevant documents - Whether company's accounts kept in order - Whether failure to keep proper accounting records give rise to fictitious transactions - Whether all payments evidenced by independent supporting documents - Whether majority shareholders caused substantial losses to company - Whether company at risk of further loss - Whether minority director has statutory right to inspect books and records of company - Whether majority directors immune from liability by having management control and rights COMPANY LAW: Derivative action - Leave - Action by minority shareholders - Payment of shareholders' interest not substantiated by relevant documents - Whether company kept proper accounting records - Whether proposed action had reasonable prospect of success - Whether fulfilled threshold test of acting in good faith and prima facie in best interest of company JUDICIAL QUOTES“To conclude, we hold that for the purpose of due administration of justice in Malaysia, the law confers jurisdiction to the subordinate courts to take cognisance of any contempt of court committed either contempt in the face of the court (facie curiae) or contempt outside of the court (ex facie curiae). The exercise of the court's jurisdiction is subject to the relevant laws and rules of court. We agree that the power to punish for contempt by inferior courts are limited under para. 26 of the Third Schedule of the SCA 1948 compared to that of the superior courts. However, in our considered view the limitation is only on the prescribed punishment and not on the court's jurisdiction. Taken in totality all the above, we hold that a Magistrate holding an inquiry of death under the CPC has the powers and jurisdiction to punish for contempt in the face of the court (facie curiae) and contempt outside of the court (ex facie curiae).” - per Hashim Hamzah JCA in Peguam Negara Malaysia v. Mohd Kassim Abd Hamid [2022] 6 CLJ 41 APPEAL UPDATES
LATEST CASESLegal Network Series
CLJ 2022 Volume 8 (Part 2) The Road Transport Act 1987 must be construed to protect innocent third party road users against risks caused by motor vehicles. In a claim involving motorist and insurance companies, the court is bound to weigh the competing interests of both parties to ensure that neither party is victimised by the other. In the event that the loss has to be borne by a party, that party has to be the insurance company, as it is compulsory for all vehicle owners to obtain insurance coverage in order for the Road Transport Department to issue road taxes for the motorists; the insurer should automatically step in and indemnify the victim, without the victim having to sue the insurer. INSURANCE | WORDS & PHRASES
INSURANCE: Motor insurance - Insurer's liability - Principles of uberrimae fidei - Whether breached by insured - Whether third party insurance policy rendered null and void and unenforceable - Whether fraud established against insured - Whether finding of liability against insurer by trial court negated allegation of fraud - Whether insurer entitled to deny liability to innocent third party claimant INSURANCE: Third party rights against insurer - Claim under policy - Third party risks insurance policy - Failure by insured to notify insurer of sale of vehicle - Whether insurer absolved from liability - Whether transfer of ownership effected upon sale of vehicle - Whether transfer of interest same as transfer of ownership - Whether lawful transfer of ownership can only be established by proof of registration under s. 13(1) of Road Transport Act 1987 - Whether non-compliance with s. 13 rendered registered owner liable for negligent act or omission of driver - Whether insurer still liable to indemnify registered owner despite insured ceased to have insurable interest INSURANCE: Third party rights against insurer - Claim under policy - Application pursuant to s. 96(3) of Road Transport Act 1987 by insurer - Whether insurer bound to serve cause papers relating to application upon third party claimant before judgment obtained by third-party claimant against insured and tortfeasor - Whether failure to serve cause papers rendered insurer's repudiation of insurance policy unsustainable in law WORDS & PHRASES: 'proceedings' - Road Transport Act 1987 ('RTA'), s. 109(2) - Interpretation of - Whether applies to civil and criminal proceedings alike - Claim for damages by third party claimant arising from accident involving motor vehicle covered by third party risks insurance policy issued pursuant to s. 90 of RTA - Whether 'lawsuit' and not prosecution - Whether 'proceedings' within meaning of s. 109(2)
ABDUL RAHMAN SEBLI FCJ (Civil Appeal No: 02(F)75-10-2019(W))
(i) There is nothing in the disciplinary procedure in the Public Officers (Conduct and Discipline) Regulations 1993 which requires the Disciplinary Authority ('DA') and the Disciplinary Appeal Board ('DAB') to give reasons for the dismissal of public officers. When there is no express or implied duty to give reasons, it falls on a case-by-case basis whether reasons ought to be given; and (ii) the DA and the DAB, being the masters of their own procedure, are at liberty to invite anyone to disciplinary proceedings. The presence or attendance of the invitees would not amount to participation in the proceedings. ADMINISTRATIVE LAW | ADMINISTRATIVE LAW
ADMINISTRATIVE LAW: Judicial review - Appeal against - Dismissal - Public officer dismissed from service - Use of public position for personal advantage - Judicial review against decision of Disciplinary Authority and Disciplinary Appeal Board - Whether charges valid and sufficiently particularised - Whether there was limitation period for disciplinary proceedings to be instituted - Whether decision-makers obliged to provide reasons for dismissal - Whether punishment proportionate to charge - Whether there was passive condonation - Whether presence of interested parties caused disciplinary proceedings to be defective - Rules of Court 2012, O. 53 ADMINISTRATIVE LAW: Public officer - Dismissal - Public officer dismissed from service - Use of public position for personal advantage - Judicial review against decision of Disciplinary Authority and Disciplinary Appeal Board - Whether charges valid and sufficiently particularised - Whether there was limitation period for disciplinary proceedings to be instituted - Whether decision-makers obliged to provide reasons for dismissal - Whether punishment proportionate to charge - Whether there was passive condonation - Whether presence of interested parties caused disciplinary proceedings to be defective - Public Officers (Conduct and Discipline) Regulations 1993, regs. 15, 37(2)(a), (b), 37D(a), (b) & 37(5)
HANIPAH FARIKULLAH JCA
The Magistrate, in finding that the appellant was careless by driving in a dangerous manner when he failed to see the presence of the motorcycle driven by the deceased before he departed into the deceased's lane, had committed an error of law by placing a greater burden on the defence to prove his innocence when in law, he needed only to raise a reasonable doubt on the prosecution's case; he is not required to prove his innocence beyond reasonable doubt. In this case, both the appellant and the deceased were found to be careless and negligent on the road. The appellant had a complete defence to a charge under s. 41(1) of the Road Transport Act 1987 despite the death of the deceased as the charge is not one of causing death but of driving dangerously or recklessly. The appellant's conviction was thus substituted for one under s. 43(1) of the Act as the evidence led by the prosecution could not support a conviction under the more serious charge of s. 41(1) . ROAD TRAFFIC
ROAD TRAFFIC: Accident - Reckless driving - Causing death - Driver found guilty for offence under s. 41(1) of Road Transport Act 1987 - Appeal against conviction and sentence - Whether ingredients of charge proved - Whether driver drove in manner which, having regard to all circumstances, dangerous to public - Whether defence raised reasonable doubt on prosecution's case - Burden of proof - Whether both driver and deceased found to be careless on road - Whether conviction of driver ought to be substituted with conviction under s. 43(1)
NOOR RUWENA MD NURDIN JC
The inherent powers of the court should only be exercised where there is a lacuna in the rules and practice of the court. There is no lacuna in O. 6 r. 7(2) of the Rules of Court 2012 that prescribes the maximum number of times a writ in rem could be extended ie, five times. Therefore, the application, seeking the invocation of the court's inherent powers and jurisdiction to extend the duration and validity of the writ in rem in question for the sixth time, is bound to fail. CIVIL PROCEDURE
CIVIL PROCEDURE: Admiralty - Writ in rem - Extension of duration and validity - Writ already extended for five times - Writ remained unserved on vessel - Vessel had not been into Malaysian waters - Whether court could invoke inherent powers and jurisdiction to extend duration and validity of writ in rem - Whether there is lacuna in rules or practice of court to enable court to invoke inherent jurisdiction - Whether writ could be extended for sixth time - Rules of Court 2012, O. 6 r. 7(2) & O. 92 r. 4 CIVIL PROCEDURE: Jurisdiction - Inherent jurisdiction - Application to extend duration and validity of writ in rem - Writ remained unserved on vessel - Vessel had not been into Malaysian waters - Whether court could invoke inherent powers and jurisdiction to extend duration and validity of writ in rem - Whether there is lacuna in rules or practice of court to enable court to invoke inherent jurisdiction - Whether writ could be extended for sixth time - Rules of Court 2012, O. 6 r. 7(2) & O. 92 r. 4
AZLAN SULAIMAN JC
The Industrial Court could refuse to act on the representation under s. 20(3) of the Industrial Relations Act 1967 ('IRA') when there is a clear violation of s. 20(1A) of the IRA which prescribes the time limit for the filing of the representation with the Director-General where, in such circumstances, the Minister obviously has no power to confer threshold jurisdiction upon the Industrial Court. When there is no issue of the claim being made outside the time limit and, where the Minister's referral is not sought to be quashed, the issue of whether an Industrial Court is competent to decide upon the matter referred to it by the Minister, does not arise. LABOUR LAW
LABOUR LAW: Industrial Court - Jurisdiction - Claim for unlawful dismissal - Claimants employee of Binational Commission - Matters referred to Industrial Court - Industrial Court ruled that it had no jurisdiction to hear and determine matters - Whether Industrial Court could disregard decision made by Minister to refer matters to it - Whether Industrial Court's jurisdiction could be challenged without having attacked Minister's act of referring dispute to it - Industrial Relations Act 1967, ss. 20(1A), 20(3) & 52(1) LABOUR LAW: Industrial Court - Jurisdiction - Claim for unlawful dismissal - Claimants employee of Binational Commission - Matters referred to Industrial Court - Industrial Court ruled that it had no jurisdiction to hear and determine matters - Whether employee workman employed by Government - Whether service with employer considered form of Government service - Industrial Relations Act 1967, ss. 20(1A), 20(3) & 52(1)
NOORIN BADARUDDIN J
Sebagai asas pendakwaan jenayah, satu-satu pertuduhan terhadap orang yang dituduh mesti jelas, tepat dan merangkumi kesalahan yang dituduh terhadapnya agar dia boleh menjawab pertuduhan tersebut sewajarnya. Apa-apa yang kurang akan mengakibatkan ketidakadilan pada orang yang dituduh. Pertuduhan yang cacat akan menjurus pada perbicaraan yang salah di sisi undang-undang. PROSEDUR JENAYAH
PROSEDUR JENAYAH: Pertuduhan - Merangka butiran - Pertuduhan bawah s. 464(a) Kanun Keseksaan - Peruntukan berkaitan definisi 'pemalsuan' - Sama ada mewujudkan kesalahan - Sama ada hanya peruntukan tafsiran - Sama ada pertuduhan cacat - Sama ada kecacatan boleh dipulihkan - Sama ada mengakibatkan perbicaraan salah di sisi undang-undang - Sama ada memprejudis tertuduh - Sama ada sabitan wajar diketepikan - Kanun Keseksaan, ss. 465 & 467 - Kanun Tatacara Jenayah, ss. 156 & 422
MOHAMAD ABAZAFREE MOHD ABBAS PK
The applicant sought leave of the Federal Court to adduce additional or fresh evidence pending the main appeals from the decision of the Court of Appeal, which affirmed the High Court's decision to convict him on seven charges and to sentence him accordingly. The proposed additional evidence sought to establish a conflict of interest giving rise to bias on the part of the trial judge and on that ground, declare that the entire trial in the High Court in the SRC case null and void. However, the applicant failed the cumulative test in the landmark case of R v. Parks by failing to establish the first two elements in the said test, namely 'availability' and 'relevancy'. CIVIL PROCEDURE | EVIDENCE
CIVIL PROCEDURE: Leave - Federal Court - Applicant sought leave of court to adduce additional or fresh evidence pending appeals - Documentary and viva voce evidence - Additional/fresh evidence sought to establish conflict of interest giving rise to bias on part of trial judge - Whether cumulative test in R v. Parks satisfied - Courts of Judicature Act 1964, s. 93 EVIDENCE: Fresh or further evidence - Federal Court - Applicant sought leave of court to adduce additional or fresh evidence pending appeals - Documentary and viva voce evidence - Additional/fresh evidence sought to establish conflict of interest giving rise to bias on part of trial judge - Whether cumulative test in R v. Parks satisfied - Courts of Judicature Act 1964, s. 93
TENGKU MAIMUN TUAN MAT CJ
CLJ 2022 Volume 8 (Part 3) Where counsel has accepted a brief, he should be deemed as 'reasonably certain of being able to appear and represent the client on the required day.' The general rule is that counsel shall make every effort to be ready for trial (and by extension appeals) on the day fixed. In this case, although the appellant has the right to discharge his former solicitors and appoint new solicitors, he could not then after having made that decision turn around and say his new lawyers are not ready to proceed with the trial. The new lawyers too are not entitled to say they need more time to prepare, knowing full well dates had been fixed in advance. A request for adjournment on such grounds that were neither cogent nor reasonable ought to be refused. CIVIL PROCEDURE | LEGAL PROFESSION
CIVIL PROCEDURE: Trial - Adjournment - Application to adjourn hearing of appeals - Change of solicitors - New counsel seeking to be given adequate time to prepare - Whether parties well aware of dates fixed for appeals - Whether counsel ought to make every effort to be ready to represent client on required day - Whether grounds in support of adjournment reasonable and cogent - Legal Profession (Practice and Etiquette) Rules 1978, rr. 6(a), 24(a), (v) LEGAL PROFESSION: Solicitors - Change of solicitors - Application to adjourn hearing of appeals - New counsel seeking to be given adequate time to prepare - Whether parties well aware of dates fixed for appeals - Whether counsel ought to make every effort to be ready to represent client on required day - Whether grounds in support of adjournment reasonable and cogent - Legal Profession (Practice and Etiquette) Rules 1978, rr. 6(a), 24(a), (v)
TENGKU MAIMUN TUAN MAT CJ
The appellant filed an application to recuse the Chief Justice from hearing the appeals and for the appeals to be reheard before a different panel. However, the grounds relied upon by the appellant in support of his application failed to raise a real danger of bias and the application was accordingly dismissed. CIVIL PROCEDURE
CIVIL PROCEDURE: Judge - Recusal - Application to recuse Chief Justice from hearing appeals and for appeals to be reheard before different panel - Whether grounds relied upon in application successfully raised real danger of bias - Whether there were merits in application
TENGKU MAIMUN TUAN MAT CJ
The Federal Court ruled that the High Court Judge's decision in finding the former Prime Minister guilty of all the seven charges on criminal breach of trust, abuse of power and money laundering was correct. The trial judge had thoroughly analysed all the evidence to support his findings and found the defence to be so inherently inconsistent and incredible. The court also, in the exercise of its inherent jurisdiction, refused the application by the lead counsel to discharge himself, as the court has the supervisory control over counsel to protect its process and so as not to let the appellant be left unrepresented. CRIMINAL PROCEDURE
CRIMINAL PROCEDURE: Appeal - Appeal against conviction and sentence - Whether ingredients of charges satisfactorily proven to warrant calling for defence - Whether defence cast reasonable doubt on prosecution case - Whether defence inherently inconsistent and incredible - Whether conviction safe - Whether sentence adequate CRIMINAL PROCEDURE: Appeal - Appeal to Federal Court - Application for discharge by counsel for accused person - Whether court could refuse application - Whether discharge would have left accused person unrepresented - Whether court possesses inherent jurisdiction to ensure fulfilment of mandate to administer justice - Whether court has supervisory jurisdiction and authority to exercise inherent and supervisory control over counsel CRIMINAL PROCEDURE: Defence - Conduct of defence - Appeal to Federal Court - Refusal by counsel for defence to make submissions on merits of appeal - Whether refusal justified - Whether counsel given opportunity to submit by court - Whether conduct equivalent to 'not appearing to support' appeals - Criminal Procedure Code, s. 313(2)
TENGKU MAIMUN TUAN MAT CJ
Income tax documents, which are tax returns and other documents made for the purposes of the Income Tax Act 1967 ('ITA') and relating to the income of the companies and/or information or other matter or thing which comes to the notice of the tax agent (a classified person) in its capacity as such, are classified materials under the ITA. Pursuant to s. 138(2) of the ITA, these tax documents are prohibited from being produced or used in court. The language of the statute ('No classified material shall be produced or used ...') is imperative and therefore the prohibition is mandatory. CIVIL PROCEDURE | REVENUE LAW
CIVIL PROCEDURE: Affidavit - Supplementary affidavits - Income tax documents sought to be adduced vide supplementary affidavits - High Court granted leave for filing supplementary affidavit but disallowed tax documents and ordered them to be expunged from court's records - Appeal against - Whether tax documents prohibited from use in court - Tax documents received from taxpayers' tax agents - Whether tax agent fell within definition of 'classified person' under s. 138(5) of Income Tax Act 1967 ('ITA') - Whether tax documents 'classified material' under ITA - Whether prohibition mandatory - Whether written authority or consent of taxpayers obtained before producing tax documents in court - Whether tax documents inadmissible under s. 138 of ITA REVENUE LAW: Income tax - Documents - Income tax documents sought to be adduced vide supplementary affidavits - High Court granted leave for filing supplementary affidavit but disallowed tax documents and ordered them to be expunged from court's records - Appeal against - Whether tax documents prohibited from use in court - Tax documents received from taxpayers' tax agents - Whether tax agent fell within definition of 'classified person' under s. 138(5) of Income Tax Act 1967 ('ITA') - Whether tax documents 'classified material' under ITA - Whether prohibition mandatory - Whether written authority or consent of taxpayers obtained before producing tax documents in court - Whether tax documents inadmissible under s. 138 of ITA
KAMALUDIN MD SAID JCA
Mahkamah Tinggi tidak boleh menolak permohonan yang dibuat selaras dengan perintah Mahkamah Rayuan yang berbentuk arahan (directive). Dalam kes ini, Mahkamah Rayuan memerintahkan agar pihak-pihak ditambah, sama ada sebagai plaintif atau defendan, dalam tindakan Mahkamah Tinggi dalam masa 14 hari; jika gagal, tindakan plaintif-plaintif di Mahkamah Tinggi akan dibatalkan. Mahkamah Tinggi tidak boleh sewenang-wenangnya menolak permohonan plaintif-plaintif, untuk menambah pihak-pihak, berdasarkan alasan teknikal yang dibangkitkan oleh defendan-defendan. PROSEDUR SIVIL
PROSEDUR SIVIL: Percantuman pihak - Permohonan - Mahkamah Rayuan memerintahkan tambahan pihak-pihak, sama ada sebagai plaintif atau defendan, dalam tindakan di Mahkamah Tinggi - Cabaran teknikal terhadap permohonan - Dakwaan permohonan tidak disokong afidavit kerana afidavit tidak disahkan - Sama ada permohonan percantuman pihak, yang dibuat berasaskan perintah Mahkamah Rayuan, wajar ditolak atas sebab cabaran teknikal PROSEDUR SIVIL: Afidavit - Afidavit sokongan - Permohonan menambah pihak-pihak sebagai defendan dalam tindakan - Dakwaan bahawa afidavit sokongan dalam afidavit tidak disahkan - Pesuruhjaya Sumpah menafikan tanda tangan atau cop meterai pada afidavit - Sama ada pengataan Pesuruhjaya Sumpah diuji kebenarannya - Sama ada penafian Pesuruhjaya Sumpah menyebabkan permohonan tiada afidavit menyokong - Sama ada permohonan wajar tidak ditolak
AZIMAH OMAR H
Rentetan sejarah kewujudan per. 152 Perlembagaan Persekutuan menunjukkan bahawa Sekolah Rendah Jenis Kebangsaan Cina dan Sekolah Rendah Jenis Kebangsaan Tamil, yang masing-masing menggunakan Bahasa Mandarin dan Bahasa Tamil sebagai bahasa pengantar, tidak pernah dilarang pewujudannya walaupun Bahasa Melayu dijulang sebagai Bahasa Kebangsaan; bahkan penggunaan lain-lain bahasa ibunda membentuk sebahagian polisi pendidikan kebangsaan. UNDANG-UNDANG PERLEMBAGAAN
UNDANG-UNDANG PERLEMBAGAAN: Undang-undang - Ultra vires - Permohonan perintah deklarasi bahawa undang-undang adalah ultra vires - Penggunaan Bahasa Mandarin dan Bahasa Tamil sebagai bahasa pengantar, masing-masing, di Sekolah Rendah Jenis Kebangsaan Cina ('SRJKC') dan Sekolah Rendah Jenis Kebangsaan Tamil ('SRJKT') - Sama ada SRJKC dan SRJKT 'pihak berkuasa awam' - Sama ada ss. 17 & 28 Akta Pendidikan 1996 ultra vires - Sama ada bercanggah dengan per. 152 Perlembagaan Persekutuan
MOHAMAD ABAZAFREE MOHD ABBAS PK
After having signed settlement agreements with and having collected the settlement sums from the developer in connection with late delivery of housing units and late completion of common facilities under the sale and purchase agreements, purchasers cease to have any cause of action for liquidated damages for delay in delivery and completion under the same sale and purchase agreements. CIVIL PROCEDURE
CIVIL PROCEDURE: Striking out - Application for - Application by developer to strike out claim by purchasers - Purchasers commenced claim for liquidated damages against developer after signing settlement agreements and collecting settlement sums - Late delivery of vacant possession and delay in completion of common facilities - Whether original causes of action superseded by settlement agreements - Whether purchasers ceased to have right to sue on superseded original causes of action - Whether claim obviously unsustainable - Whether there were triable issues - Whether clear and obvious case for summarily striking out of suit - Rules of Court 2012, O. 18 r. 19
TEE GEOK HOCK JC
A plaintiff is clearly entitled to seek pre-action discovery of impugned documents containing defamatory words against it, as the production of those said documents is necessary to determine if it can commence a claim against unknown persons making allegations causing it to suffer economic losses. Such discovery order is essential, for disposing fairly of the cause or matter and for saving costs. CIVIL PROCEDURE
CIVIL PROCEDURE: Discovery - Pre-action discovery - Application for pre-action discovery to identify intended defendant - Preliminary objection raised - Whether there was statutory immunity for defendant against suits and legal proceedings under s. 31A of Valuers, Appraisers, Estate Agents and Property Managers Act 1981 - Whether documents/information sought privileged - Whether information sought necessary for plaintiff to formulate cause of action against complainants - Whether disclosure of information sought could interfere with or prevent statutory functions of defendant - Whether application fishing expedition - Rules of Court 2012, O. 24 r. 7A & O. 92 r. 4
LEONG WAI HONG JC
A stakeholder sum is not to be confused with a booking fee. The former is a sum of monies staked to a third party to be held in trust while the latter is collected into the developer's pocket as the deposit to denote interest to form legal relations. In the absence of a booking fee, the liquidated ascertained damages (LAD) run from the date the contract is formalised. LAND LAW | CIVIL PROCEDURE
LAND LAW: Housing developer - Delay - Enforcement of payments of liquidated ascertained damages - Allegations of delay of completion of property purchased, common facilities and delivery of vacant possession - Whether there was extension of time for completion of residential unit granted by Housing Development Board - Exact date when delay was to be calculated from - Whether time ran from date sale and purchase agreement was entered or from date deposit was paid by purchaser to developer LAND LAW: Housing developer - Stakeholder sum - Purchaser and developer entered into sale and purchase agreement for purchase of residential property - Allegations of delay of completion of property purchased, common facilities and delivery of vacant possession - Exact date for calculation of liquidates ascertained damages - Whether calculated from date booking fee paid to developer - Whether sum paid stakeholder's sum or booking deposit - Whether booking fee paid CIVIL PROCEDURE: Mode of commencement - Proceedings - Housing Controller approved extension of time for delivery of vacant possession of common facilities and for issuance of strata title - Purchaser seeking to dispute validity of extensions - Whether originating summons correct mode for challenging such decision - Whether purchaser should have mounted challenge through judicial review - Whether improper and abuse of court process
JOHN LEE KIEN HOW JC
ARTICLESLNS Article(s)
LEGISLATION HIGHLIGHTSPrincipal Acts
Amending Acts
PU(A)
PU(B)
Legislation Alert Updated
Revoked
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