Former Port Klang Authority (PKA) general manager OC Phang has been ordered to pay damages to the authority over losses it suffered in the construction of the Port Klang Free Zone.

Justice M Gunalan made the ruling today at the Shah Alam High Court.

In other words, the High Court disagreed with Phang's lawyers that there is no case for her to answer.

The principle of "no case to answer" is a term in criminal law, whereby a defendant seeks acquittal without having to present a defence.

The court ruled that Phang committed 11 of the 15 purported breaches listed by PKA. 

Justice Gunalan said it is not for the court to make a specific finding of breaches of duty by Phang and that it would suffice to decide if a prima facie case has been made out on the alleged breaches.

He added that the crux of PKA's case was unrebutted in view of Phang's failure to call important and pivotal witnesses, such as the transport minister, to prove that she was merely acting on the instructions of the Transport Ministry, Finance Ministry and the prime minister in executing her functions and the various agreements (except the first) without first referring to the PKA board of directors for approval.

The judge concurred with PKA's contention that it being a statutory body, Phang owed her duties to PKA as its general manager, and as such, cannot in law bypass the board of directors and rely solely on sanctions of the Transport Ministry, Finance Ministry and the prime minister to enter into the agreements which were binding on PKA.

"It is erroneous for Phang to contend that the treasury guidelines were not binding or applicable to her or that she had not known of the same. Phang cannot in principle rely solely on the protection of the Transport Ministry for her actions," Justice Gunalan said.

The court ruled that Phang had breached her duties as PKA general manager by entering into agreements without first consulting the PKA board of directors and in disregard of PKA's dire financial state, but which instead appeared to benefit the interests of another third party.

"Hence, the court is of the view that there is sufficient evidence to establish Phang's breach of her contractual, statutory and fiduciary duties under 11 breaches," the judge said.

The court also fixed Oct 4 to hear submissions on Phang bringing in the third party claimants, who are the PKA board of directors, either for them to be held liable or otherwise.

Justice Gunalan ordered that the damages be assessed by the senior assistant registrar and costs to be determined after the assessment on the standard basis.

PKA had filed the suit against Phang for criminal breach of trust and breach of fiduciary duties to transform Port Klang into a national load centre and regional transhipment hub.

Previously, former PKA chairperson Lee Hwa Beng has testified that Phang failed in her duties as the GM, bypassed the PKA board, and that PKA could not afford to build the Port Klang Free Zone (PKFZ) project in a single phase.

PKA was represented by Lim Chee Wee, Khoo Guan Huat and Nimalan Devaraja while Phang was represented by a team of lawyers led by Matthew Thomas Philip, Lavinia Kumaraendran, Mavinthra Jothy and Joshua Goh.