His lawyer, Guok Ngek Seong, said High Court judge Justice Ahmad Zaidi Ibrahim also ordered Lim to pay RM2,000 in costs.
“The judge said there are issues in the case that need to be heard in a trial,” he said.
Guok said the two-term DAP MP would appeal against today’s decision.
“In UK, political parties cannot sue for defamation but this has not been decided in Malaysia,” the lawyer said, adding that Lim’s case would be a test case.
Last July, MCA secretary-general Ong Ka Chuan filed the suit against Lim over the comments made by the MP at a press conference held at the Parliament building on March 15, 2016.
Ong said Lim’s remarks had seriously injured MCA’s reputation, adding that the Chinese-based party was seeking RM100 million in general and exemplary damages.
Lim had referred to information from his sources alleging that MCA had never used its own funds to give allocations to Chinese schools, and that MCA had instead pocketed public funds.
He had urged MCA to declare the party’s assets and show how much money had been given for Chinese education.
In his defence, Lim said as a people’s representative, he was entitled to question issues of public interest.
“It is my duty to seek answers on issues concerning the people,” he said.
Lim filed an application to strike out MCA’s suit on Sept 12, 2017 on the grounds that MCA, as a political party, had no legal standing to sue an individual.
This was based on an English case law (Goldsmith vs Bhoyrul) in the late 1990s that stated political parties had no power to sue.
Lim, who is Federal Territories DAP secretary, had previously said in a press conference that he received a letter of demand from MCA, asking him to retract his accusation towards the Chinese party and pay RM100 million in damages.
“Maybe MCA thinks I’m a billionaire, or that I have personal donations in my account. But no, I don’t have RM100 million,” he had said in response to the demand notice.