176 FGV HOLDINGS BERHAD NOTES TO THE FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2022 54 CAPITAL COMMITMENTS Group 2022 RM’000 2021 RM’000 Capital expenditure approved and contracted for: - Property, plant and equipment 407,048 124,368 407,048 124,368 55 CONTINGENT LIABILITIES Other than those disclosed in Note 56, there are no significant contingent liabilities as at the financial year end. 56 MATERIAL LITIGATION (i) On 18 May 2021, FGV Prodata System Sdn. Bhd. (“Prodata” or “the 1st Defendant”) an indirect subsidiary of the Company, was served with a sealed Writ of Summons dated 12 May 2021 (“the Writ”) by VDSL Technology Sdn. Bhd. (“VDSL” or “the Plaintiff”). The Plaintiff claimed for compensation and damages amounting RM170,707,600 due to the 1st Defendant and FELDA’s (“2nd Defendant”) alleged breaches on various arrangements agreed upon by the parties with regard to the Felda Broadband Initiative Project. On 1 November 2021, VDSL has filed amended statement of claim and case management was held on the same day for the main suit, Prodata’s application for security cost and VDSL’s application for protective order. Pursuant to the hearing on 19 January 2022, the Judge directed the case be fixed for mediation for parties to explore and discuss a possible amicable settlement; while the court proceedings to continue to run its course. On 11 May 2022, the Mediator acknowledged that the mediation was unsuccessful. No further mediation is fixed. On 9 November 2022, Prodata has informed the Judge that Prodata is not agreeable to record a consent order on VDSL’s protective order application. On 16 December 2022, the Judge recorded the consent order between VDSL and Felda in respect of both VDSL’s protective order application and Felda’s discovery application. The Judge dismissed the security for costs applications filed by Prodata and Felda respectively, with costs of RM5,000 (subject to allocator fee of RM200, therefore totaling RM5,200) payable by each of Prodata and Felda to VDSL. On 9 January 2023, Prodata has filed an appeal to Court of Appeal against the High Court’s dismissal of Prodata’s application for security for costs. On 18 January 2023, during the case management, parties were informed as follows: (i) Both Felda & Prodata are appealing the High Court’s decision on the Security for Costs applications; (ii) Felda also filed an appeal on the High Court’s decision on Felda’s Striking Out application; (iii) VDSL would like to file an application to amend its Amended Statement of Claim The Court of Appeal (against the High Court’s dismissal of Prodata’s application for security for costs) has fixed case management on 10 April 2023. The purpose of this case management is to fix a date for hearing of Prodata’s appeal. On 14 March 2023, Prodata and Felda have informed the Court that they will oppose VDSL’s application of its Amended Statement of Claim. The High Court has fixed 16 May 2023 for the hearing. Based on legal opinion, there is a fair chance of Prodata succeeding in defending the claim from VDSL.
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