1. ) PCP Construction Sdn Bhd v 1. ) Leap Modulation Sdn Bhd (WA-24C-170-12/2016, WA-24C-8-01/2017 &WA-24C-9-01/2017)

the Respondent shall pay to the Claimant a sum of RM1,930,981.43 as the Adjudicated Sum within 14 days hereof;

the Respondent do pay the interest at the rate of 5% per annum on the adjudicated sum of RM1,930,981.43 from 6.12.2016 until the date of full payment

the Respondent shall pay to the Claimant within 14 days hereof the following payment:

Adjudicator’s fees (excluding GST) and KLRCA’s administration fee amounting to RM19,423.36;

(ii) GST on the Adjudicator’s fees of RM1,923.11;

(iii) KLRCA registration fee of RM250.00;

(iv) KLRCA adjudicator appointment fee of RM400.00;

Adjudicator’s expenses of RM627.18; 12

the Respondent shall pay to the Claimant the sum of RM10,000.00 as the costs allowed to the Claimant within 14 days from the date hereof. Principles [22] There are very limited grounds for setting aside an Adjudication Decision under section 15 CIPAA, with the common grounds being that under section 15(b) in that there has been a breach of natural justice or under section 15(d) in that the Adjudicator has acted in excess of his jurisdiction. [23] I agree with the Claimant that an adjudication decision cannot be aside on the grounds that:

the parties disagree with the adjudicator’s decision be it on the merits or on the assessment of the case or finding of facts or law by the adjudicator; and

(ii) the fact that this Court may have made a different finding on the issues of law or facts. [24] In the case of Bina Puri Construction Sdn Bhd v Hing Nyit Enterprise Sdn Bhd [2015] MLJU 941 paragraph 9, Justice Ravinthran Paramuguru J. held that: 13 "It must be noted that under CIPPA, there is no right of appeal against the decision of the Adjudicator which is interim in nature or of temporary finality only. Section 15 has provided limited grounds on which the decision of the Adjudicator may be set aside. Since an application under section 15 is not an appeal, the decision of the Adjudicator cannot be reviewed on merits… [12] ... As I said earlier, section 15 does not envisage that the decision of the Adjudication can be reviewed on its merits. Therefore, it is immaterial if the Adjudicator had erred in his finding of facts." (emphasis added) [25] The same principle was echoed by Justice Mary Lim Thiam Suan J (now JCA) in ACFM Engineering & Construction Sdn Bhd v Esstar Vision Sdn Bhd and another case [2015] MLJU 1951 where her Ladyship held that: “[54] In one of the few adjudication cases that went on appeal, the Court of Appeal in Carillion Construction Limited v Devonport Royal Dockyard Limited [2005] EWHC 778 too, gave relevant insights as to the approach and attitude of the Courts in such matters. At paragraphs 85 and 86 of the judgment, the Court said: 14 "85. The objective which underlies the Act and the statutory scheme requires the Courts to respect and enforce the adjudicator's decision unless it is plain that the question which he has decided was not the question referred to him or the manner in which he has gone about his task is obviously unfair. It should only be in rare circumstances that the courts will interfere with the decision of an adjudicator. ..." [55] Again, one finds the same refrain from the Court of Appeal. That these adjudication decisions are meant to be complied with; and that it is only in "rare" cases or where it is "plain that the question which he has decided was not the question referred to him or the manner in which he has gone about his task is obviously unfair" that the Court should wade in to interfere. I agree that this is the right approach to adopt in relation to section 15 of CIPAA 2012."(emphasis added) [26] In Econpile (M) Sdn Bhd v IRDK Ventures Sdn Bhd and another case [2017] 7 MLJ 732 at para 72, I had also echoed the same principle, referring to the English case of UK Technology and Construction Court in Westwood Structural Services Ltd v Blyth 15 Wood Park Management Co Ltd [2008] EWHC 3138 (TCC) which held that: “[13] The principles as to enforcement of adjudicators' decisions are well known. They can be summarised as follows:

"the objective which underlies the Act and the statutory scheme requires the courts to respect and enforce the adjudicator's decision unless it is plain that the question which he has decided was not the question referred to him or the manner in which he has gone about his task is obviously unfair. It should be only in rare circumstances that the courts will interfere with the decision of an adjudicator": see para 85 of the judgment of Chadwick LJ in Construction Ltd v Devonport Royal Dockyard Ltd [2005] EWCA Civ 1358 104 ConLR 1; [2006] BLR 15.

An error of fact or law will not invalidate an adjudicator's decision. If the adjudicator has answered the right question in the wrong way, his decision will nevertheless be binding. It is only if he has answered the wrong question that his decision will be a nullity: see the Court of Appeal decisions in Bouygues (UK) Ltd v Dahl-Jensen (UK) Ltd [2001] 1 All ER (Comm) 1041, 73 ConLR 16 135, [2000] BLR 522 and C & B Scene Concept Design Ltd v

Isobars Ltd [2002] EWCA Civ 46, 82 ConLR 154; [2002] BLR "(emphasis added) [27] I agree with the Claimant that an adjudication decision may only be set aside if:

the learned Adjudicator has failed to answer the question referred to her or she has answered a question which was not referred to her; or

the manner in which she has gone about her task is obviously unfair; which may then amount to one of the grounds under Section 15 CIPAA. Whether the Adjudicator's interpretation of clause 25.4(iv) of the Contract is erroneous and goes toward jurisdiction [28] The Respondent had relied on clause 25.4(iv) to withhold payment of Payment Certificates Nos.17R and 18 to the Claimant following the determination of the Contract as the said clause 25.4(iv) provides that: “The Contractor shall allow or pay to the Employer in the manner hereinafter appearing the amount of loss caused to Employer by the determination. Until after the completion of the works under sub-clause 25.4(i), the Employer shall not be bound by any 17 provision in this contract to make any further payment to the Contractor, but upon such completion and verification of the accounts within a reasonable time the Architect shall certify the amount of expense properly and actually incurred by the Employer and the amount of any loss caused to the Employer by the determination and, if such amounts added to the monies paid to the Contractor before the date of determination exceed the total amount which would have been payable on completion in accordance with the Contract, the difference shall be a debt payable to the Employer by the Contractor, and if the said amounts when added to the said monies be less than the said total amount, the difference shall be debt payable by the Employer to the Contractor."(emphasis added) [29] In holding that the Respondent shall not be entitled to withhold interim certificates no.17R and 18 by relying on clause 25.4(iv), the Adjudicator considered the submissions by both parties and took into account the following:

High Court’s decision in Econpile (M) Sdn Bhd v IRDK Ventures Sdn Bhd and another case [2017] 7 MLJ 732 where I had opined that clauses such as clause 25.4(iv) of the Contract has the effect of postponing payment due until 18 the final accounts are concluded and the works completed and that would be defeating the purpose of the CIPAA and is therefore void and unenforceable being a conditional payment provision under section 35(1) CIPAA and the adjudicator may disregard it altogether (para 46 Adjudication

case law has dictated that the interim certificates constitute finality on the assessed value of work done by the contractor which under the terms of the construction contract oblige the employer to forthwith pay the contractor the sum certified, and the failure on the part of the employer constitutes a breach of an essential term of the contract which the contractor may sue to recover (para 51 Adjudication

clause 30.3 of the said Contract provide that the amount stated as due in the interim certificate shall be the total value of the work properly executed, unless agreed between the parties as to stage payments (para 52 Adjudication

clause 30.3(i) of the Contract provide that the employer shall not be entitled to withhold or deduct any amount certified as 19 due under any architect’s certificates by reason of any claim of set-off or counterclaim or allegation of defective works, material or goods or for any other reasons whatsoever which he may purport to excuse him from making payment of the amount stated to be due in the interim certificate (para 52

Clause 30.2 of the Contract provides that the contractor shall be entitled to payment within the period of honouring certificates, which is 30 days; and

the Adjudicator has also duly taken note and considered all of Respondent's submission and argument. [30] In relation to the issue on clause 25.4(iv) one must also bear in mind clause 30.2 which provides that the contractor shall be entitled to payment within the period of honouring certificates. As correctly stated by the Adjudicator the period of honouring the certificates is 30 days and so the last day for payment of the Payment Certificates Nos. 17R and 18 are 3.12.2015 and 30.12.2015 respectively. [31] Thus these payments were due even before the Notice of Determination issued by the Respondent dated 1.2.2016. Against this is the expression in clause 25.4(iv) of "further payment" and the question 20 as to whether that expression would include all payments certified and due for payment but not paid yet. [32] I cannot find any good reason to disagree with the Adjudicator that these 2 Payment Certificates were already due for payment and so the Respondent cannot use the event of determination of the Contract to withhold payment. [33] That is a matter of interpretation as to whether the Payment Claim is due for the 2 Payment Certificates or whether the 2 Payment Certificates fall within the meaning of "further payment" which are to be postponed until completion of works. The Adjudicator had asked herself the right question under Issues at paragraph 40 b. of her Decision which reads: "Whether the Respondent is able to rely on clause 25.4(iv) of the COC to withhold payment of the Payment Certificates Nos. 17R and 18." [34] The Adjudicator had asked the right question and I am of the view that she had answered correctly and even if she had answered wrongly, that is no justification for this Court to interfere unless it is a question that goes towards jurisdiction. 21 [35] The answer to the question raised does not go towards jurisdiction and even if this Court is minded to arrive at a different answer, that is still no good reason to interfere as this is not an appeal. Whether the Adjudicator had wrongly failed to exercise jurisdiction over the set-off in the Architect's Payment Certificate No. 19 which is a negative Certificate [36] Where an issue is a jurisdictional one raised at the Adjudication, this Court in a setting aside application is not bound by the decision of the Adjudicator. When a jurisdictional challenge is raised the Adjudicator may in his discretion proceed and complete the adjudication proceedings without prejudice to the rights of any party to apply to set aside the Adjudication Decision under section 15 or to oppose the application to enforce the Adjudication Decision under section 28(1) CIPAA. [37] Implicit in that exercise of discretion is the liberty given to the Adjudicator to decide on the issue of jurisdiction though his decision would not be binding on this Court in a setting aside or enforcement application. [38] In a case where the Adjudicator is clear that he has or does not have jurisdiction especially in a matter of contingent jurisdiction in that a 22 matter must come within the Payment Claim (section 5) and Payment Response (section 6) as required under section 27(1) CIPAA, he may proceed to exercise or decline jurisdiction accordingly. [39] When the matter comes before the Court for decision under a section 15 or 28(1) CIPAA application, the Court will decide on the matter afresh, independent of and unfettered by the decision of the Adjudicator. [40] This is so because where jurisdiction is concerned, it is a matter conferred by statute and confined to the matters raised in the Payment Claim and Payment Response and not even in the Adjudication Claim or Adjudication Response. Unless parties have agreed to extend the jurisdiction of the Adjudicator to decide on any matter not referred to the Adjudicator pursuant to section 5 and 6, the Adjudicator clearly has no jurisdiction as stated in section 27(2) CIPAA. [41] In such a case, where an Adjudicator purports to exercise jurisdiction, he would be exceeding his jurisdiction where he does not have jurisdiction. [42] The Respondent had given some reasons for disputing the amount claimed in the Payment Claim and as required in section 6(2) the non- 23 paying "shall serve a Payment Response in writing in the unpaid party stating the amount disputed and the reasons for the dispute." [43] It is true that a specific amount is not stated with respect to the amount disputed and one can suppose that the entire amount is disputed for even in a case where the Payment Response is not served, the non-paying is deemed to have disputed the entire Payment Claim under section 6(4) CIPAA. In fact, paragraph 2 of the Payment Response reads as follows: "We write to dispute your entire claim for the sum of RM1,821,680.60 vide the Payment Claim premised on the following:..." [44] CIPAA does not expect parties to frame their claims and defences of set-off in precise legal language and the lament from the industry is that the Payment Claim, Payment Response as well as the subsequent Adjudication Claim, Adjudication Response and Adjudication Reply have run into pages after pages of legalese. [45] The procedure and proceedings were supposed to be simple such that even legal representation is not necessary as stated in section 8(3) CIPAA as follows: "A party to the adjudication proceedings may represent himself or be represented by any representative appointed by the party." 24 [46] The choice of language is apparent as we are only too familiar that in a court proceeding in litigation, a company invariably has to be represented by solicitors and by and large, parties in an adjudication would be companies incorporated under the Companies Act 1965 or the new Companies Act 2016. [47] The intent is that the procedure should be simple and not complicated, swift and not unnecessarily detained by technical legal objections and in plain language so that a party not represented by solicitors would not have to wade through a legal labyrinth; trying to figure out for instance the difference between a cross-claim that is or is not a set-off but more in the nature of a counter claim. [48] It is here that the perspicuity of the language used in section 6(2) is to be appreciated as follows: "A non-paying party who disputes the amount claimed in the payment claim, either wholly or partly, shall serve a payment response in writing on the unpaid party stating the amount disputed and the reason for the dispute." (emphasis added) [49] The legislature has avowedly avoided the legal term of a "defence, set-off, cross-claim". Nothing could be simpler and less intimidating than the expression "the reason for the dispute." 25 [50] The reasons for the dispute in the Payment Response served in Exhibit P2 of Enclosure 2 in the OS for setting aside, is captured and contained in paragraphs (c), (d) and (e) of the Payment Response. They stated that the Claimant is obligated to compensate them for all losses caused to them by the determination of the Contract and that in the light of the Claimant's structural non-compliances since November 2015 as well as various defaults leading to the determination, the Claimant will appreciate that they are being put to great expense not only to complete the Work following the determination but also to carry out the rectification works following the Claimant's structural non-compliances especially in the light of the adverse independent concrete test results in January 2016. [51] The Adjudicator fully appreciated the fact the Respondent ought to be allowed to set off the amount of RM351,646,68 from the Interim Certificate No. 19 against payment of the Payment Certificates Nos. 17R and 18 provided that she had jurisdiction to decide on the set off raised of costs of rectification works as can be seen in paragraph 62 of the Adjudication Decision. [52] Unlike the other 3 items raised only for the first time in the Adjudication Response with respect to the various heads of structural defects investigation and audit costs, additional costs of completion of 26 about RM6.8 million and associated costs of RM1.6 million, this item certified by the Architect as payable by the Claimant to the Respondent was issued on 19.1.2016 which certified a sum of RM351,646.68 as being due from the Claimant to the Respondent "due to the extremely poor results of the concrete core test samples observed on 17/12/2015, we had no choice but to revalue the work done for payment." See paragraph 54 of the Adjudication Decision. [53] That Interim Certificate 19 at p 1052 of Enclosure 6 in the OS for setting aside was issued on 19.1.2016 before the service of the Payment Claim by the Claimant on 22.1.2016. Even if the Claimant had missed that, they should have been completely candid and disclosed it in their Adjudication Claim as Certificate 19 is a follow-up and continuing from Certificate 18. [54] At any rate the fact that the amount raised as a set off in this Interim Certificate 19 was not specifically stated is not a matter that the Claimant is prejudiced because the said Interim Certificate had already been issued by the Architect before the service of the Payment Claim by the Claimant. [55] The fact that the amount is not pleaded would mean that the Respondent has to prove this in the Adjudication Response documents filed, which they had. 27 [56] The Adjudicator was fully conscious of the fact that the Architect had the right to issue this Payment Certificate 19 as she observed in the following paragraphs of her Adjudication Decision: "60. As regards the Interim Certificate No. 19 dated 19.1.2016, I note clause 30.1 of the COC, which provides that the Architect may, by any certificate correct any error or discrepancy which has been discovered in any previous certificate or may modify any previous certificate, other than a certificate of practical completion or the final certificate, which has been issued by him.

While this is a certificate that was issued later in time after the Payment Certificates Nos. 17R and 18 were already due and payable, it nevertheless relates to estimated value of work done by the Claimant, as assessed and verified by the Architect under the COC." (emphasis added) [57] The Respondent having raised the defence of set off for the rectification works, no matter how inelegant and imprecise as in failure to state the amount in the Payment Response, cannot be shut out totally by the Adjudicator taking too restrictive a view of her own jurisdiction and being unduly technical. 28 [58] One should not be exacting more from a Respondent in adjudication than one would from a Defendant in litigation or arbitration in that if the amount of set off is not quantified though stated in the Architect Certificate, then one is precluded from raising this as a defence even though reference has been made to it in fulfilling the requirement of section 6(2) in "stating the reason for the dispute". [59] I would say that it would be retrogressive and much to be regretted if Adjudicators should embark on an exercise of over-analyzing what is a dispute that has been referred to in an adjudication under CIPAA. [60] The important thing is that the parties are fully aware of what they have to answer arising from the Payment Claim and the Payment Response. Hence the need to avoid being pedantic or overly technical or legalistic where the determination of the issues of the dispute is concerned. [61] The advice of Akinhead J in Witney Town Council v Beam Construction (Cheltenham) Ltd [2011] 139 ConLR 1 at 18 (paragraph 38), provides guidance in this respect: “[38]…

(iv) What a dispute in any given case is will be a question of fact albeit that the facts may require to be interpreted. Courts should 29 not adopt an over-legalistic analysis on what the dispute between the parties is, bearing in mind that every construction contract is a commercial transaction and parties cannot broadly have contemplated that every issue between the parties would necessarily have to attract a separate reference to adjudication.” [62] Going back to basics, the entire rationale of service of the Payment Claim and Payment Response is that the parties are not caught by surprise and that an adjudicator should not stray outside the dispute and go on a frolic of his own. One must not miss the wood for the trees. Judge Toulmin CMG QC in AWG Construction Services Ltd v Rockingham Motor Speedway Ltd [2004] EWHC 888 (TCC) at paragraph 141 said: “[141] In my view, each case must depend on the circumstances and the context in which a referral is made. In some cases the issues referred are very specific. In other cases it is clear that the issues are more general and have been so treated by the parties, and that there is significantly more room for the case to be developed. The test in each case is first what dispute did the parties agree to refer to the adjudicator? And, secondly, on what basis? If the basis which is argued in the adjudication is wholly different to that which a defendant has had an opportunity 30 to respond in advance of the adjudication, this may constitute a different dispute not referred to the adjudicator or, put another way, in so far as adjudicator reaches a decision on the new issues, it is not responsive to the issues referred to him.” (emphasis added) [63] As is not uncommon, a termination at this early stage of the life of a contract may require some time for the dust to settle where the counter allegations of defective works are concerned coupled with extra costs incurred in completing the balance Work which would invariably hinge on whether the determination of the employment by the Respondent is valid for the reasons given. As it is, final accounts have not been concluded and the true extent of the Respondent cross claim as a set off may not be fully determinable at this stage in Adjudication. [64] The Adjudicator had pointed out that the 3 items in the claim for structural defects investigation and audit costs of RM161,839.50, additional costs of completion of about RM6.8 million and associated costs of about RM1.6 million are matters to be pursued at arbitration by the Respondent as they had not specifically required the Adjudicator to decide on the issue of validity of termination in their Payment Response filed. The Adjudicator had some basis for finding that those claims by way of a set off were not properly and precisely pleaded. 31 [65] I am doubtful if the Adjudicator could have completed such a massive adjudication within the tight time frame provided for under CIPAA unless the parties had agreed to extend the time for her to arrive at her Decision under section 12(2)(c) CIPAA. She had wisely declined jurisdiction for those claims on ground of not properly and precisely pleaded and that these cross-claims are still evolving and more properly pursued in arbitration. [66] I am also reminded of what was observed in Cantillon Ltd v Urvasco Ltd [2008] 117 ConLR 1: "[67] ... As the authorities established that the responding party can put forward any arguable defence in adjudication, ... it must follow that the adjudicator can rule not only on that defence but also upon the ramifications of the defence to the extent that it is successful in so far as it impacts upon the fundamental dispute." (emphasis added) [67] In the present case the defence of set off is wide enough to cover the event certified by the Architect in Certificate 19 that has an impact on the fundamental dispute being the Payment Claim under Certificate Nos. 17R and 18 as modified and corrected by Certificate No. 19 and thus reducing the Claimant's Payment Claim had the Adjudicator correctly exercised and assumed jurisdiction to hear this set off. 32 [68] I would say that the Adjudicator's analysis of her jurisdiction would be applicable to the three items of structural defects investigation and audit costs, additional costs of completion of about RM6.8 million and associated costs of about RM1.6 million but not to the sum certified as due from the Claimant to the Respondent under Certificate No. 19 of RM351,646.68. Her cautious and perhaps unduly cautious approach is reproduced below:

paragraph 42: “At the outset, I am mindful that my jurisdiction as an adjudicator under CIPAA as provided in section 27(1) of CIPAA, is limited to the matters referred to adjudication by the parties pursuant to sections 5 and 6 of CIPAA. On the extent and construction of section 27(1) and therefore the matters that I have jurisdiction of, I look to the learned High Court Judge’s judgment in View Esteem Sdn Bhd v Bina Puri Holdings Sdn Bhd [2015] MLJU 695 for guidance. That firstly, the parties are bound by their pleadings under the rules of procedure in civil litigation; in adjudication, those pleadings are to be found in the Payment Claim and Payment Response, and not the Adjudication Claim, Adjudication Response or the Adjudication Reply. That 33 secondly, because adjudication is intended to provide a speedy resolution of the payment dispute, the adjudicator cannot be expected to deal with issues, legal and/or factual, which may still be evolving or in the making as the adjudicator sits down to determine the dispute.

paragraph 64: “As is clear from Justice Mary Lim’s judgment (as she then was) in the cases of View Esteem and WRP Asia Pacific, my jurisdiction as adjudication are restricted to the matters found in the sections 5 and 6; that the adjudication takes jurisdiction from the payment claim and payment response, not from the adjudication claim, response or reply. This is materially significant and important as this brings to bear the whole scheme of CIPAA; that the adjudication proceedings is to deal with or resolve a payment dispute. My sole task as an adjudicator is to resolve the dispute between the parties arising from the payment claim and payment response. As Justice Mary Lim said in her judgment in WRP Asia Pacific’s case, my sole task is to resolve the dispute for the reasons already made known between the parties and nothing else…” 34

paragraph 66: “Whilst I could appreciate this, section 27(1) of CIPAA and the cases are clear on my role as an adjudicator. My jurisdiction is limited to the matters as raised in the Payment Claim and Payment Response. To be more specific, my role as an adjudicator is to resolve the dispute for the reasons already made known between the parties and nothing else. I am therefore bound by section 27(1) of the CIPAA and given that the matters claimed by the Respondent as a set-off/deduction have not been raised in its Payment Response, I am not able to consider the set off…” [69] As I had pointed out, it is not quite correct to say that the set-off and deduction had not been pleaded at least where the negative certification of the Architect in Certificate No. 19 is concerned that comes up under the rubric of the "compensation that the Respondent was seeking for all losses caused by the Claimant..." The actual words of "set off or cross claim" need not have to be used; only the reasons for disputing the claim. [70] I would therefore hold that the adjudicator had wrongly and unduly diminished and restricted her jurisdiction to hear the set off in Certificate No. 19 certified by the Architect. 35 Whether a failure of the Adjudicator in exercising jurisdiction to hear the set-off in Certificate 19 is a breach of natural justice [71] Having held that the Adjudicator had wrongly declined jurisdiction over the above set off, the question is whether such a failure to exercise jurisdiction is a breach of natural justice? [72] This issue was addressed head-on by Coulson J in Pilon Limited v Breyer Group Plc [2010] EWHC 837 (TCC) as follows: "5. ISSUE 2; DID THE ADJUDICATOR TAKE AN ERRONEOUSLY RESTRICTIVE VIEW OF HIS OWN JURISDICTION AND, IF SO, WHAT ARE THE CONSEQUENCES?

5.1. The Law

An adjudicator can make an inadvertent mistake when answering the question put to him, and that mistake will not ordinarily affect the enforcement of his decision: see Bouygues (UK) Ltd v Dahl-Jensen (UK) Ltd [2000] BLR 49. If, on the other hand, he considers and purports to decide an issue which is outside his jurisdiction, then his decision will not be enforced: see the discussion in Sindall Ltd v Solland [2001] 3 TCLR 712. But there is a third category, which is where the adjudicator takes 36 an erroneously restrictive view of his own jurisdiction, with the result that he decides not to consider an important element of the dispute that has been referred to him. This failure is usually categorised as a breach of natural justice. Cases in this category include:

17.1. Ballast Plc v The Burrell Company (Construction Management) Limited [2001] BLR 529, where the adjudicator failed to address the valuation dispute referred to him because the parties had departed from the terms of the written contract. Lord Reid concluded that the adjudicator’s decision - to the effect that, as a matter of jurisdiction, he could not take into consideration even the possibility that the parties might depart from the written terms of the contract - was wrong in law. The adjudicator had misconstrued his powers and failed to exercise his jurisdiction to determine the dispute. His decision was therefore ruled a nullity.

17.2. Broadwell v k3D [2006] ADJ CS 04/21, in which HHJ Raynor QC refused to enforce an adjudicator’s decision because he had failed to address the responding party’s counterclaim. This was on the erroneous basis that there had been no mention of the counterclaim in the notice of 37 adjudication, leading the adjudicator to conclude that he did not have the jurisdiction to consider it. The judge held that this fundamental error meant that the adjudicator had failed to have regard to the responding party’s legitimate defence, and had therefore not conducted the adjudication in accordance with the rules of natural justice.

17.3. Thermal Energy Construction Limited v AE and E Lentjes Uk Limited [2009] EWHC 408 (TCC), where HHJ Stephen Davies refused to enforce an adjudicator’s decision in circumstances where the adjudicator had again wholly failed to address the set-off and counterclaim raised by the defending party ..." (emphasis added) [73] At paragraph 22 of the judgment, the Court stated that when an Adjudicator erroneously takes a restrictive view of his own jurisdiction, it is tantamount to a breach of natural justice. Justice Coulson J distilled the various situations in this regard as follows: “As a matter of principle, therefore, it seems to me that the law on this topic can be summarised as follows:

22.1 The adjudicator must attempt to answer the question referred to him. The question may consist of a number of 38 separate sub-issues. If the adjudicator has endeavoured generally to address those issues in order to answer the question then, whether right or wrong, his decision is enforceable: see Carillion v Devonport.

22.2 If the adjudicator fails to address the question referred to him because he has taken an erroneously restrictive view of his jurisdiction (and has, for example, failed even to consider the defence to the claim or some fundamental element of it), then that may make his decision unenforceable, either on grounds of jurisdiction or natural justice: see Ballast, Broadwell, and Thermal Energy.

22.3 However, for that result to obtain, the adjudicator's failure must be deliberate. If there has simply been an inadvertent failure to consider one of a number of issues embraced by the single dispute that the adjudicator has to decide, then such a failure will not ordinarily render the Decision unenforceable: see Bouygues and Amec v TWUL.

22.4 It goes without saying that any such failure must also be material: see Cantillon v Urvasco and CJP Builders Limited v William Verry Limited [2008] EWHC 2025 (TCC). In other words, the error must be shown to have had a potentially 39 significant effect on the overall result of the adjudication: see Keir Regional Ltd v City and General (Holborn) Ltd [2006]

22.5 A factor which may be relevant to the court's consideration of this topic in any given case is whether or not the claiming party has brought about the adjudicator's error by a misguided attempt to seek a tactical advantage. That was plainly a factor which, in my view rightly, Judge Davies took into account in Quartzelec when finding against the claiming party.” (emphasis added) [74] I would gladly follow such a sensible and sound approach consistent with the notion of fair play and reasonableness as representing our law within the scheme of statutory adjudication under CIPAA. [75] Here too the Adjudicator had consciously or deliberately, as referred to in para 22.3 of the said judgment, addressed the issue of jurisdiction and came to a rather narrow and restrictive view of her jurisdiction resulting in her wrongfully declining jurisdiction over the above set off. 40 [76] However there is a redeeming factor in that the Adjudicator had carefully decided that if not for jurisdiction or rather the lack of jurisdiction as she perceived it, she would have allowed the claim of set off in Certificate No. 19. This vital element would be relevant in the later discussion as to whether this Court may in this unique circumstance set aside part of the Adjudication Sum by reducing it accordingly by the sum that the Adjudicator would have allowed had she not wrongly declined jurisdiction to consider the above set off. [77] Conversely such an Adjudication Decision or so much of it as may be tainted would not be enforceable. Thus in the case of PC Harrington Contractors Limited v Tyroddy Construction Limited [2011] EWHC 813 (TCC) (High Court), His Lordship Akenhead J, in paragraphs 21(e) & (g), decided that: “(e) It seems to me, therefore, that, by wrongly deciding that this was a matter outside his jurisdiction, he put himself in the position whereby he did not consider the final account evidence and argument in any detail or indeed really at all. He has, therefore, put himself in a comparably similar position to the adjudicators in the CJP v William Verry and the Humes Building Contractors cases in that, by ruling on his jurisdiction in such a way that he has denied himself the opportunity to consider the merits of the exercise which 41 Harrington had asked him to determine, he has committed a breach of natural justice. (emphasis added) ...

These points are material and certainly more than peripheral breaches of the rules of natural justice. ... The consequence of the above is that on this ground the decisions of the Adjudicator should not be enforce.” (emphasis added) [78] In the case of Paul Boardwell t/a Boardwell Construction v k3D Property Partnership Ltd [2006] Adj. C.S. 04/21 (High Court), His Lordship HHJ Raynor, QC, decided that: “... The Defendant relied upon paragraph 49 of Quietfield Ltd v Vascroft Contractors Ltd [2006] EWHC 174 (TCC) and more particularly paragraph 51 – ... the adjudicator ought to have considered Vascroft’s substantive defence, but he failed to do so. In those circumstances, as Quietfield have fairly conceded, the adjudicator’s decision cannot be enforced because he failed to abide by the rules of natural justice.” (emphasis added) 42 [79] A similar decision can be found in the case of Buxton Building Contractors Ltd v Governers of Durand Primary School [2004] EWHC 733 (TCC) (High Court). [80] Likewise in Thermal Energy Construction Limited v AE & E Lentjes UK Limited [2009] EWHC 408 (TCC) (High Court), His Lordship Davies J, at paragraphs 16, 26 & 37, observed as follows: “16. ... What Mr. Furst has submitted is that this is a case where the Defendant, having raised the defence of set-off and counterclaim, was entitled to have the Adjudicator consider that question, and the Adjudicator was indeed obliged to consider that question as being one of the matters raised by the Defendant in its defence. He submits that by failing to do so, that failure being evidenced by an absence of any reasons given in relation to that element of the defence, the Adjudicator failed to comply with his obligations under the contractual adjudication scheme. ...

It seems to me that in those circumstances, the position is that the Adjudicator has not, evidently, dealt with this issue at all, and he has not given any reasons which would indicate that he has dealt with this issue. That this is therefore one of those 43 cases, one envisages rare, where the Adjudicator has failed to comply with his obligations. ...

For all these reasons I have reached the conclusion that this is one of those relatively rare cases where the Court must decline to enforce the decision of the Adjudicator.” (emphasis added) [81] I am therefore constrained to find that there was nevertheless a breach of natural justice when the Adjudicator failed to exercise and assume jurisdiction to hear and allow the set off of rectification costs pleaded in the Payment Response and more precisely referred to in the Adjudication Response in Payment Certificate 19 being a negative Certificate. Whether this Court may reduce the Adjudicated Sum by the amount that the Adjudicator said she would allow as a set off in Payment Certificate 19 if she had jurisdiction [82] It has been generally thought that once there is a breach of natural justice then the natural consequence is that the whole of the Adjudication Decision has to be set aside much like an arbitral award 44 where it can be shown that there has been a breach of natural justice on the part of the learned Arbitrator. [83] It is said that public policy demands that and there is no need to second guess how the decision would be like if there had not been a breach of natural justice. [84] Be that as it may, it has been said that it is not every breach of natural justice would result in an Adjudication Decision to be set aside. The breach must not be peripheral or minor but must be portent and major; reflective of a breach of fair play or procedural fairness. [85] However bearing in mind the purpose of the Act in facilitating regular and timely payment and to provide a mechanism for speedy dispute resolution through adjudication, it would be rather wasteful of time and resources if in cases where one can sever the good from the bad, not to be able to save the Adjudication Decision with setting aside the part affected. [86] Granted not every case is amenable to that for the Court cannot get into the shoes, as it were of the Adjudicator, and take over the finding of fact which is within the pure purview and province of the Adjudicator. 45 [87] However in our present case the Adjudicator had said categorically that she would have allowed the said set off in Payment Certificate No. 19 if not for the fact of her perceived lack of jurisdiction. It is not unlike a case where a Sessions Court Judge is finding that there has been no liability on the part of the defendant driver in negligence in a running down case, nevertheless would undertake an assessment of damages exercise if it is found on appeal that the defendant is negligent wholly or contributorily. [88] To have to set aside the whole of the Adjudication Decision, only to have it re-adjudicated with predictable result because the other part of the Adjudication Decision is unassailable, would be an exercise in wasteful and wanton dissipation of resources of time and money. It would be to prefer and prize form over substance. [89] There has been substantial development in the jurisprudence in this area of law with respect to adjudication. I need to refer only to the approach of the English courts in Cantillon Ltd v Urvasco Ltd [2008] EWHC 282 (TCC) where Justice Akenhead reasoned with unrivaled persuasion a case for severability in cases which justify it as follows: "59. In Keating on Construction Contracts (8th edition) the following is said at Chapter 17-045: 46 “It seems probable that if there is a breach of natural justice, the whole decision is unenforceable, and it is not possible to sever the good from the bad.” In a footnote supporting this observation the following is said: “See RSL ( South West) Ltd-v-Stansell Ltd unreported (June 16, 2003), but also see the observations in Griffin –v-Midas Homes Ltd [2001] 78 Con LR 152. For a discussion of the issue of severability of adjudicators’ decisions generally, see Sheridan and Helps, ‘Construction Act Review’ [2004] 20 Const. LJ 71”.

I am by no means convinced that this observation in Keating (of great weight that it is) is correct. The case of Griffin and Another-v-Midas Homes Ltd [2000] 78 Con LR 152 is actually authority for the proposition that, where an Adjudicator has exceeded his jurisdiction, that part of the decision which was made within his jurisdiction can be enforced. It does not appear that the issue of severability as such was argued in that case or, as such, ruled upon by HHJ Lloyd, QC, who tried it.

The paper by Peter Sheridan and Dominic Helps in the Construction Law Journal is specifically about “Severability of 47 Adjudicator’s decisions”. The authors specifically addressed the issue as to whether an Adjudicator’s decision may be partly enforceable and partly not enforceable. They make observations on a number of cases: ...

The authors of this article conclude as follows: “On the basis of the cases decided so far, the following would appear to be the position on severability:

Where two or more disputes are referred to an Adjudicator, a valid objection to one decision, on jurisdiction or natural justice grounds, will not necessarily affect the validity and enforceability of the Adjudicator’s decision on the other dispute or disputes.

Where a single dispute is referred to one Adjudicator, it may not be severed so as to excise a part of the decision to which valid objection is taken, on jurisdiction or natural justice grounds, leaving the balance valid and enforceable. A decision on the single dispute is either valid and enforceable or invalid and not enforceable. 48

It follows that an Adjudicator’s decision may not be corrected to take account of a jurisdiction objection, with the result that a sum larger than that in the Adjudicator’s decision may be enforced by a Claimant. ...

On the severability issue, I conclude, albeit obiter in the result, as follows: a. The first step must be to ascertain what dispute or disputes has or have been referred to adjudication. One needs to see whether in fact or in effect there is in substance only one dispute or two and what any such dispute comprises. b. It is open to a party to an adjudication agreement as here to seek to refer more than one dispute or difference to an adjudicator. If there is no objection to that by the other party or if the contract permits it, the adjudicator will have to resolve all referred disputes and differences. If there is objection, the adjudicator can only proceed with resolving more than one dispute or difference if the contract permits him to do so. 49 c. If the decision properly addresses more than one dispute or difference, a successful jurisdictional challenge on that part of the decision which deals with one such dispute or difference will not undermine the validity and enforceability of that part of the decision which deals with the other(s). d. The same in logic must apply to the case where there is a non-compliance with the rules of natural justice which only affects the disposal of one dispute or difference. e. There is a proviso to (c) and (d) above which is that, if the decision as drafted is simply not severable in practice, for instance on the wording, or if the breach of the rules of natural justice is so severe or all pervading that the remainder of the decision is tainted, the decision will not be enforced. f. In all cases where there is a decision on one dispute or difference, and the adjudicator acts, materially, in excess of jurisdiction or in breach of the rules of natural justice, the decision will not be enforced by the Court."(emphasis added) [90] In a very real sense in the present case there are at least 2 disputes. One is the Claimant's payment claim and the other is the 50 Respondent's cross-claim of a set-off in Payment Certificate No. 19. If the set-off should have been heard then let it be heard and allowed as the Adjudicator said it would if she could. It is then not a case of a little leaven leaveneth the whole lump but one where the wheat could be separated from the chaff. [91] In the decision of UK Technology and Construction Court in Paice and another v MJ Harding (t/a MJ Harding Contractors) [2016] EWHC 2945 (TCC), the Court held that: “Jurisdiction [64] The issue is whether the adjudicator had jurisdiction to determine the claimants' entitlement to deduct the sum of £6,049.60 from the amount otherwise due to the defendant on account of design provided by the claimants to the defendant in respect of House A, not forming part of the contract; if there was no jurisdiction, whether that part of the decision is severable. … [68] The adjudicator's jurisdiction is derived from the adjudication agreement. Article 7 and cl 9.2 of the contract entitle either party to refer any dispute or difference arising under the contract to adjudication. The dispute in respect of the design fees did not 51 arise under the contract; it arose, if at all, under a separate agreement. Therefore, the adjudicator did not have jurisdiction to determine the design fees dispute. … [70] However, that part of the adjudication decision can be severed from the other parts of the decision: Cantillon v Urvasco Ltd [2008] EWHC 282 (TCC), (2008) 117 ConLR 1, per Akenhead J at paras [63] and [76]. The defendant relies on the decision in Cleveland Bridge (UK) Ltd v Whessoe-Volker Stevin Joint Venture [2010] EWHC 1076 (TCC), (2010) 130 ConLR 159 to submit that the design fees issue cannot be severed but Cleveland can be distinguished on its facts. In that case, the adjudicator did not identify an alternative decision so as to identify the proportion that would survive any excess of jurisdiction. In this case, the adjudicator identified and valued the design fees claim separately, so that there is no difficulty in severing that part of the award from the rest of the decision. [71] Accordingly, paras 3.245–3.263 of the adjudication decision are in excess of jurisdiction and are not enforceable but can be severed from the remainder of the decision.” (emphasis added) 52 [92] In the case of Bovis Lend Lease Ltd v The Trustees of the London Clinic [2009] EWHC 64 (TCC), the UK Technology and Construction Court held that: “[39] A further issue arises between the parties as to whether or not it is legally and practically possible to 'sever' the adjudicator's decision if it be the case that he did have jurisdiction to address the dispute relating to delay, extension of time and the recovery of liquidated damages but did not have jurisdiction to address the loss and expense claim. … Discussion – severability [69] It follows from the above that, since the adjudicator had jurisdiction and there has been no breach of the rules of natural justice, the question of severability simply does not arise. If I had had to decide the point, I would only have done so on the basis that the clinic had established its jurisdictional argument in relation to the loss and expense claim (which it has not). If I had formed the view that the adjudicator had simply, consciously, not given the clinic sufficient time to respond (within the constraints of the adjudication timetable available in this case), this would probably not have been a case which would have led to severance. 53 However, on a jurisdictional basis, if I had formed the view that the crystallised dispute did not include the claim for loss and expense, I would have been of the view that that part of the decision which demonstrably related to the extension of time claim and the recovery of liquidated damages could be recovered. The award was one which was eminently severable. The adjudicator indicated clearly what 'redress' he was granting with regard to the extension and liquidated damages issues.” (emphasis added) [93] In Australia too there has been a palpable paradigm shift in favour of severance. The Supreme Court of Victoria in Gantley Pty Ltd v Phoenix International Group [2010] VSC 106, discussed the doctrine of severance at great length and I am particularly impressed with the reference to the over-arching purpose of the Act. The Court therein reasoned as follows: “Is Severance of the Payment Claims Possible? “[95] In these matters, however, I did raise with counsel the possibility of severance, in the event that I found that part of the payment claims, being the claims for variations, were described in adequate detail such that these components of the payment claims ought to survive, even if the balance of 54 the claim in each case was to be declared invalid on the ground of non-compliance with s 14(3)(a). Accordingly, I heard argument on the point, which I will now address. … [114] It was submitted by Mr Robins, who appeared for the respondent, that severance should not be permitted because the Act did not permit this to occur. Either the progress claim was fully compliant in all of its facets, or it was not, it was argued. If one part of the progress claim did not satisfy the requirements of s 14(3)(a) the whole of the progress payment would therefore fail and should be set aside as being invalid. [115] I do not accept this submission. The question should be whether the Act, either expressly or impliedly, operates to exclude the common law doctrine of severance. I find that it does not. Indeed, the purposes and objects of the Act earlier described are best served by processes which, so far as possible, ought to accommodate reasonable flexibility and avoid unnecessary technicality. [116] Severance in this case would operate to achieve the purpose and objects of the Act and would not operate to diminish the attainment of these goals. A respondent to a 55 payment claim and an adjudicator, if appointed, should be able to assess the valid part of this progress claim which sufficiently describes the work for which payment is claimed, and provide a rational response or adjudication determination in respect of that part of the claim, and exclude from consideration that part of the claim which does not comply.” (emphasis added) [94] I am emboldened in the company of eminent minds referred to above to comfortably sever the good from the bad and in the result, to allow so much of the set off represented in Payment Certificate 19 to be deducted from the Adjudication Sum and the interest of 5% per annum to apply to this reduced Adjudication Sum accordingly. Whether there are special circumstances justifying a stay of the Adjudication Decision pending the disposal of the arbitration [95] Section 16(1) CIPAA provides for the grounds for the stay of the Adjudication Decision as follows: "16(1) A party may apply to the High Court for a stay of an adjudication decision in the following circumstances:

an application to set aside the adjudication decision under section 15 has been made; or 56

the subject matter of the adjudication is pending final determination by arbitration or the court." [96] It is quite academic with respect to the application for stay pending the hearing of the application for setting aside as parties were content to let the status quo remain until the 3 OS were heard together and disposed of. [97] What is relevant with respect to the application for stay of the Adjudication Decision is stay until the disposal of the arbitration. The fact that there is a pending arbitration is a mere threshold condition that must be met. It is that condition precedent and once that is met, the Court that always retain a discretion in stay, will decide on the stay based on whether there are special circumstances. [98] This can be seen in Subang Skypark Sdn Bhd v Arcradius Sdn Bhd [2015] 11 MLJ 818 where Justice Mary Lim J (now JCA) held that: “[25] In both cases under sub-s 16(1), the other proceedings be it for setting aside of the adjudication decision or, arbitration or court proceedings in relation to the same subject matter, are pending and the stay is really to preserve some status quo. But, it is only under either of these two situations that an application for stay may be lodged and not otherwise. This limited right is 57 consistent with the whole scheme of CIPAA 2012, which is to afford speedy disposal of payment disputes on a temporary note of finality. During this time of pendency, be it of an application to court to set aside the adjudication decision, or where the final determination by another arbiter or court is awaited, the adjudication decision is binding on the parties. Compliance with the adjudication decision is a given and part of the rules of the game in this industry and what CIPAA is all about in the first place." (emphasis added) [99] Thus the fulfillment of section 16(1) does not mean the stay to be granted automatically. As explained by Justice Mary Lim J (now JCA) in Subang Skypark (supra) that: "[27] That is not to say that simply because the dispute or subject matter of the adjudication decision is now in the arbitration mode regime, the grant of stay is automatic. It is not, let alone as of right or as a matter of course. Being in arbitration merely puts the plaintiff's case as one within s 16 for consideration; or one which has crossed the threshold. The existence of concurrent proceedings merely prequalifies the plaintiff for this application." (emphasis added) 58 [100] A stay of the Adjudication Decision may only be granted in exceptional circumstances. To quote Subang Skypark (supra): "[29] How then is an application for stay to be considered; should it be on the same general principles applicable where there is an appeal; or should the exercise of discretion be along the same principles when dealing with a fortuna injunction? [30] It is this court's view that in the exercise of discretion of whether to grant the stay or make an order for payment to the Director of KLRCA, the court must weigh into play in a fairly extensive way, the object of CIPAA; and that it is for a speedy disposal of a payment dispute. This is regardless of the fact that this is a payment dispute that arose in the final days of the construction contract, a point which the parties appear to have no issue with and there is no challenge in this respect anyway. Having gone through the hoops of adjudication, there is now decision in the defendant's favour. [31] This court is of the view that the defendant should not be deprived of the very benefit of why it resorted to adjudication 59 in the first place; save if satisfactory reasons are present for a stay of that adjudication decision. [32] It is my further view that stay should only be granted in exceptional circumstances; and such circumstances must necessarily refer to the financial status of the other party. The merits of the case before the arbitration or the court; or even the chances of success in setting aside the adjudication decision are not relevant considerations. The grant of any stay must always weigh in the primary object of the CIPAA 2012; that it is to ensure a speedy resolution of a payment dispute; that it is to inject much needed cashflow into the contractual arrangements between parties that saw progressive payments of claims as the recognised and accepted way of doing business in construction contracts. It would be futile to encourage parties to resort to adjudication and then deprive a successful claimant of its claim by staying the access to the cash simply because there is another proceeding of the nature described in sub-s 16(1) which is pending. The whole concept of temporary finality would be lost and the object of the Act defeated if such was the consideration." (emphasis added) 60 [101] This principle has been affirmed and approved by the Court of Appeal in the case of View Esteem Sdn Bhd v Bina Puri Holdings Bhd [2016] 6 MLJ 717 where Justice Hamid Sultan JCA held that: "[31] Further, trial court must be extremely slow in granting an application for stay as the purpose of the CIPAA 2012 is to ensure that the contractor gets his due immediately. In dealing with the stay application, trial court ought also take note that in almost all standard form of construction contract, the employee is protected by unjustified claim from the contractor as there will be provision for certification of the claim by neutral persons such as QS as well as architect as in the instant case. [32] …Unless there is overwhelming evidence that the contractor will not be able to complete his contractual obligations as well as meet up with the financial obligation to the employer, a stay should not be granted. Even if a stay is granted, it must be on condition that the money is paid to court and/or stakeholders account as the court deem fit." (emphasis added) [102] To come within the meaning of exceptional circumstances, the Respondent must adduce concrete and overwhelming evidence as to 61 the financial inability on the part of the Claimant to repay the Adjudicated Sum, should the Respondent succeed in the arbitration. [103] The Respondent submitted that the guarantor, Mr Goh Pian Chiang (a director of the Claimant) refused to extend the personal guarantee and that shows that he has no faith in the Claimant's financial ability and was not willing to give any guarantee or assurance as to the Claimant's financial ability. [104] It appeared that the Respondent had via letter dated 27.10.2015 required the Claimant to provide an extended guarantee to be guaranteed by two directors of the Claimant. On top of that, clause 7.2 of the said Contract only provides that the said guarantee shall be in force from 2.5.2014 until 2.10.2016 and it does not provide for any extension as requested by Plaintiff. [105] I can accept the reason why the Claimant and Mr Goh Pian Chiang had rejected the Respondent's request which was unreasonable and a unilateral imposition of a fresh term the Contract as well as the arrangement between the parties. [106] The Respondent highlighted that the Claimant's Financial Statements and Report for the year of 2015 shows a decline in Claimant's cash reserve and trade receivable. The Claimant explained 62 that the decline in the cash reserve is mainly attributed to the Respondent's own failure to pay the Claimant based on the Contract. The failure of the Respondent to pay had driven the Claimant to utilise its own cash reserves to pay its suppliers. Be that as it may, the Claimant still has sufficient cash to repay the Adjudicated Sum to the Plaintiff if directed by this Court due to the Claimant's strong and healthy long-standing financial status. This can be seen in Exhibit B-3 of the Claimant's Affidavit in Reply which shows that the Claimant has RM2,962,456.71 in its bank account as at 30.1.2017. [107] I can agree with the Claimant that it is still a profitable company as can be shown at page 8 of Exhibit “LM-7” of the Affidavit in Support which is the “Balance Sheet as at 31 December 2015”, whereby it has recorded a positive increment for balance from RM2,230,840.00 (year 2014) to RM2,635,153.00 (year 2015). [108] In addition to the above, the Claimant's financial ability and status is not solely confined to cash reserves only. As a matter of fact, the Claimant still owns considerable immovable assets amounting to RM4,087,821.00 as stated in the said Balance Sheet as at 31 December 2015 which, if coupled with the Claimant's liquid assets, is more than sufficient to repay the Adjudicated Sum, should need be. (Exhibit B-5 of the Claimant's Affidavit in Reply). 63 [109] I find that there should be no cause for worry about the Claimant's ability to repay and in any event the burden of proof on the balance of probabilities is on the Respondent and the Respondent has not been able to point to any evidence of a reasonable apprehension of the Claimant's inability to repay. [110] Then there is the Respondent's fear that an adjudication proceeding between the Claimant and one Ing Cheong Engineering Sdn Bhd (“ICESB”) may result in favour of ICESB and that the Claimant may not be able to repay the Adjudicated Sum should the Claimant be required to pay ICESB under the said adjudication proceeding. [111] To allay the Respondent's fears, the Claimant disclosed that even if they are obliged to pay ICESB under the said adjudication, the sum claimed by ICESB in the said adjudication is only RM539,445.83 which is only around 25% of the Adjudicated Sum. The Respondent's fear is more imaginary than real. [112] The Respondent alleged that Mr Goh Pian Chiang has formed a new company named Kreatiflex Construction Sdn Bhd and there is possibility that Mr Goh Pian Cheng will let the Claimant to be wound up to avoid repayment of the Adjudicated Sum. The Claimant clarified that Kreatiflex Construction Sdn Bhd was incorporated in 2005 and has since then started to accept construction works as a sub-contractor, which is 64 long way before the said Contract. The allegation of the Respondent is baseless and speculative and far from the “concrete and overwhelming evidence” as required by case law. [113] For all the reasons given above I am constrained to dismiss the stay application for being singularly devoid of merits. Pronouncement [114] To recapitulate, I had set aside that part of the Adjudicator's Decision with respect to not considering the set off in Certificate No. 19 and thus, if rightly considered, would result in a set-off of RM351,646.68 from the Adjudication Sum of RM1,930,981.43, giving the reduced sum of RM1,579,334.75. Interest at 5% per annum shall be on this reduced sum. [115] Correspondingly I had allowed enforcement for this reduced sum plus interest. [116] The stay application was dismissed as there was no cogent evidence pointing towards the impecuniosity or insolvency of the Claimant. [117] As I had set aside part of the Adjudication Decision, I exercised my discretion and made no order as to costs in the setting aside application as well as the enforcement application. As for the stay application, I 65 ordered costs of RM5,000.00 to be paid by the Respondent to the Claimant. Dated: 27 June 2017. - sgd - Y.A. LEE SWEE SENG Judge Construction Court Kuala Lumpur For the Plaintiff in : Phang Soon Mun and OS WA-24C-170-12/2016 : Chew Chun Wei and for the Defendant in : (Messrs Han & Partners) OS WA-24C-8-01/2017 and : OS WA-24C-9-01/2017 For the Defendant in : Andrew Heng and Roger Leong OS WA-24C-170-12/2016 : (Messrs Zain Megat & Murad) and for the Plaintiff in : OS WA-24C-8-01/2017 and : OS WA-24C-9-01/2017 Date of Decision: 17 February 2017.