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Posted: 08 Aug 2011 03:16 PM PDT

The Federal Land Development Authority (FELDA) is facing more legal suits from participants in its land schemes, the latest from 711 settlers in Jengka, Pahang, filing a RM344 million case against it for fraud and breach of trust in the High Court in Temerloh.FELDA has already seen suits from settlers in Kelantan, Johor and Negri Sembilan, with the case taken up by the settlers in Jengka being the latest – and largest – in Peninsular Malaysia.

The suit was filed through solicitors M/s Daim & Gamany this morning, with Subang MP Sivarasa Rasiah acting as lead counsel.The settlers named FELDA and FELDA Palm Industries Sdn Bhd, as defendants.

In their statement of claim, they said they were contractually bound by Felda to deliver their oil palm yield exclusively to FELDA Palm Industries. They have always been paid a lower oil extraction rate the last 15 years – averaging at 18.5 percent as stated in the Akuan Penerimaan BTS, the receipt that is given for each truck delivery of fruit bunches, they said.

The settlers suspected something amiss when their oil extraction rates could never match the higher recommended rate of the Malaysian Palm Oil Board, and they then sent random samples of their fruit yields to independent laboratories to assess the actual oil extration rate.

The results from the lab tests showed a much higher average rate of 27 percent, which would mean an average difference of 8.5 percent over the rate paid them by FELDA Palm Industries.

Statistics in question

The 711 settlers, who are from 16 Felda programmes in Jengka, also claim to have evidence to show that they had delivered at an average yield of 120 metric tonnes per settler in 2008, for which Felda paid them an average of RM560 a tonne.

Using the figure of 8.5 percent lost to the settlers, they said, FELDA Palm Industries paid them RM257.60 less for every tonne, which worked out to be a loss of RM30,912 for each settler in 2008 alone.

They also claimed that FELDA had deducted their fruit yields improperly by subtracting an average of 200kg a month for "disqualified" fruit bunches, without returning the fruit bunches to the settlers. This led to a further loss of RM1,344 a settler a year, or RM14,333,760 for all the settlers over the 15-year claim period.

They claimed that over the last 15 years, FELDA caused the 711 settlers to suffer losses of more than RM344 million.

Through this writ of summons and the process of discovery in court, the settlers said, they hoped to obtain the exact production figures for all the other schemes involved to compute a more accurate measure of their losses over the claim period.

The settlers are also seeking exemplary damages as they contend that FELDA, as a statutory authority set up by law to look after the welfare of the settlers, had instead exploited its position of power and authority over the settlers and committed fraud and breach of trust.

Suit comes after FELDA Kemahang success

The suit by the Jengka settlers follows the success of the FELDA Kemahang 3 settlers, who were awarded RM11 million last year in their suit against felda. On Monday, the High Court in Kota Baru awarded the FELDA Kemahang 1 and 2 settlers RM1.2 million in a similar suit they took up.

Felda was ordered to pay the FELDA Kemahang 3 settlers RM11 million for cheating them by stating the grade of their oil palm fruit to be of a lower grade. FELDA appealed, but the appeal was thrown out.

With this decision, the FELDA Kemahang 3 settlers are expected to receive between RM25,000 and RM30,000 each in the first suit of its kind against Felda.  The landmark decision has been seen to be a big blow to FELDA and the government, for FELDA is regarded as a backbone of the Malays and bumiputera community and a 'safe deposit' for BN, for it could lead to more law suit.

And this happened, with 766 Felda settlers from Rancangan Serting and Gugusan Raja Alias in Negeri Sembilan seeking damages totalling RM200 million from Felda in a suit filed last August.

Prior to this, 400 settlers from FELDA Maokil in Labis, Johor, filed a RM71.8 million suit against Felda on June 12, 2009.

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