The PKA board of seven members has been in a quandry over whether or not to take legal action, and members wanted to consult their legal advisors before making a final decision, said Lee (right).

"It's the most difficult decision we have (had) to make: we are damned if we do, and damned if we don't.

"What was done is not a crime but a managerial lapse, so it's very hard to decide. Also, it involves lots of people, including political appointees and government nominees, including the Prime Minister's Office and the Ministry of Transport," he said.

He added that the board members has until Nov 30 to consult their legal advisors.

Earlier, the Public Accounts Committee (PAC) and a special task force's findings on the PKFZ scandal had revealed serious breaches by PKA's directors and other individuals against safeguarding the interests of the PKA and public funds, committed between 2002 to 2006.

Amongst these were the board's failure to supervise then general manager OC Phang who now faces criminal charges, failure to award contracts through open tender and deciding to purchase land at a higher interest rate.

PKA's lawyers have advised the board to take legal action against the implicated directors.

The board also risks being sued by future directors if it does not do so.

Lee also confirmed that the minister has the prerogative to appoint another four more members to the board, although the quorum for it to function is only four.

When asked if such an action would delay the board's decision-making since Lee said he preferred a consensus on the issue, the chairperson whose term ends next year said, "I will have to give you a political answer and say we will cross the bridge when we have to."

He also asked reporters not to "prejudge" the situation by suggesting such a possibility.

To date, PKA has filed five civil cases, is involved in two defamation cases and three criminal cases, and has lodged three complaints with professional bodies like the Bar Council related to the Port Klang Free Zone (PKFZ) scandal.

“The board has made many brave decisions,” he said.

Lee meanwhile commented on the performance of the PKFZ revealing that occupancy has risen significantly over the past three years.

He said light industrial units hit 40.6 percent this August, occupying 208 of 512 available units.

Open land occupancy has increased to 115 acres (18 percent) while total proposed investment rose to RM1.3 billion as compared to RM844 million in 2008.

According to PKFZ chief executive officer Chia Kon Leong, the facility is currently handling 3,500 containers a month and is expected to handle "at least 20,000 this time next year".

"We expect that we will run out of land to lease in three to five years time," he said.

He added that they will have a large Singapore-based logistics company setting up operations by the end of the year, while an Indian maritime university is looking to build a campus on their grounds.

PKFZ also achieved its first ever operating surplus of RM5.1 million last year and is expecting to double it in 2010.

"We are sitting on a volcano that exploded, and there was a lot of lava, but now the land is very fertile," he quipped optimistically.

However, Lee was not as upbeat about the RM4.9 billion Ministry of Finance soft loan that allowed PKA to pay RM2 billion to Kuala Dimensi over the past three-year period.

“The total loan, with interest is RM7.6 billion. We will have to begin to repay the government in 2012, but will only be able to manage the first payment.

“Even if we reach 100 percent occupancy, we will not be able to make the payments,” said Lee.