Damai City Sdn Bhd v Grand Dynamic Builders Sdn. Bhd. (WA-24C-139-09/2024)

of the Construction Industry Payment And Adjudication Act 2012 (“CIPAA”) for: a. a declaration that the Adjudication Decision dated 20.8.2024 (AD) is illegal and void; b. an order to set aside the said AD; and c. an Order for costs. [2] There is also in OS 139 an application under enclosure 11 for a stay of the AD pursuant to section 16 (1)(b) CIPAA (Enclosure 11) pending the disposal of the stay application or the disposal of the Arbitration Proceedings under in Enclosure

[3] On the other hand, Originating Summons No. WA-24C-143-09/2024 (OS 143) is Grand Dynamic Builders Sdn Bhd (“GDB”) application to enforce the AD in accordance with section 28 CIPAA. [4] In support of OS 139, DCSB alleges amongst others that:

4.1 the Adjudicator failed to deliver the AD within the time prescribed under CIPAA which tantamounts to him being in excess of jurisdiction;

4.2 the Adjudicator failed to give grounds or reasons with regards clause 25.4(d) of the PAM Contract being the entitlement to the Employer not to make payments including certified sum;

4.3 the Adjudicator had failed to allow DCSB to file a Rejoinder

4.4 the issue of Interim Certificate No.24 which DCSB claims had not matured and were therefore not due;

4.5 issues of res judicata. Brief Background Facts [5] By way of a letter of award dated 9.11.2020, DCSB appointed GDB as the main contractor to carry out building works for a project known as the 8 Conlay Project located at Lot 20000 (Lot Lama 111 & 112) Seksyen 63, Bandar Kuala Lumpur, Jalan Conlay, Wilayah Persekutuan Kuala Lumpur (“8 Conlay Project”) with the total award sum being RM 1,249,000,000.00. [6] The following, read together, constitute the Contract between parties for the 8 Conlay Project: -

Letter of Award dated 9.11.2020 with the correspondences between the parties appended which was to form part of the Letter of Award; i. Contractor’s letter ref.: GDBSB/HQ/MGT/DCSB/2112 dated 28th October 2020 ii. Contractor’s Revised Alternative Tender Submissions – Tender Addendum No. 5(R) via the Contractor’s letter ref.: GDBSB/HQ/MGT/DCSB/2101 dated 21st October 2020 iii. Contractor’s Revised Alternative Tender Submissions – Tender Addendum No. 5(R) via the Contractor’s letter ref.: GDBSB/HQ/MGT/DCSB/2093 dated 15th October 2020 iv. Contractor’s Alternative Tender Submissions – Tender Addendum No. 5 (R) via the Contractor’s letter ref.: GDBSB/HQ/MGT/DCSB/2090 dated 12th October 2020 v. Contractor’s Alternative Tender Submissions via the Contractor’s letter ref.: GDBSB/HQ/MGT/DCSB/2056 dated 25th September 2020

The “Agreement and Conditions of PAM Contract 2006 (With Quantities)”, issued under the sanction of the Pertubuhan Arkitek Malaysia (“PAM”), together with the supplementary clauses, amplification notes, amendments, and modifications thereto as set out in Document G – Annexure to the Conditions of Contract (“PAM Contract”);

The Contract Drawings;

The Contract Bills; and

Other documents incorporated in the Contract Documents, unless expressly stated to be excluded therefrom. [7] Subsequent to the Contract, the parties had also:-

by way of Letters of Amendments dated 15.12.2020 and 22.3.2022 agreed to amend the terms and conditions of the

entered a Supplementary Agreement dated 20.5.2022 which is to be read together with the Contract, to temporarily put on hold and slow down the Works between May 2022 to October 2022. [8] Allegedly in breach of the Contract, DCSB was alleged to have constantly delayed payment that was due to GDB for the certified sums under the Contract. [9] Upon requests by DCSB, the Parties had subsequently entered into the following agreements which were to be read together with the Contract in respect of the outstanding certified sums which were due and payable under Interim Certificates No. 13 to No. 21: -

August 2022 Agreement dated 5.8.2022;

October 2022 Agreement dated 21.10.2022;

December 2022 Agreement dated 9.12.2022;

January 2023 Agreement dated 4.1.2023; and

March 2023 Agreement dated 6.3.2023 [10] Notwithstanding the agreements entered between the Parties as mentioned above, DCSB had allegedly still failed, refused, and/or neglected to pay GDB for the full sum of RM79,706,278.42 in respect of Interim Certificates No. 17(R1), 18, 19, 20, and 21. [11] Meanwhile, RSP Architects Sdn Bhd, acting as the 'Architect ' and 'Superintending Officer' under the Contract, had previously issued Interim Certificates Nos. 22R, 23R and 24 totalling to the sum of RM13,687,464.35 where DCSB had also allegedly failed, refused, and/or neglected to pay GDB. The details of which are as follows: -

Interim Certificate No. 22R dated 03.01.2023 for the sum of RM464,531.77 which was due and payable on 7.1.2023;

Interim Certificate No. 23R dated 08.01.2023 for the sum of RM5,475,593.69 which was due and payable on 25.3.2023; and

Interim Certificate No. 24 dated 27.3.2023 for the sum of RM7,747,338.89 which was due and payable on 21.4.2023. [12] DCSB subsequently and allegedly further failed, refused and/or neglected to make full payment of Interim Certificates No. 17(R1) (which was not paid in full) to No. 24, amounting to a sum of RM102,076,171.93 as at 3.5.2023. [13] In view of DCSB’s alleged continuous default in payment to GDB, GDB served a Payment Claim dated 3.5.2023 pursuant to Section 5 of CIPAA 2012, for the sum of RM102,076,171.93: -

The sum of RM93,393,742.77 being the outstanding sums due under Interim Certificate No. 17(R1) (which was not paid in full) to No. 24;

Late payment interest pursuant to Clause 30.17 of the PAM Contract for Interim Certificates No. 17(R1) (which was not paid in full) to No. 24 as of 24.4.2023; and

Late payment interest pursuant to Clause 30.17 of the PAM Contract for Interim Certificates No. 2 up to Interim Certificate No. 17(R1) (of which part payment was made). [14] On 18.5.2023, DCSB served it’s Payment Response pursuant to Section 6 of CIPAA 2012 upon GDB and refused to make payment for the sums demanded in the Payment Claim. In the Payment Response, DCSB raised the following contentions:

the claimed amounts in the Payment Claim are subject matters of a completed Adjudication Proceeding No. AIAC/D/ADJ-4479-2022 (“Adjudication Proceeding 4479”) and any adjudication proceedings arising from the same would amount to duplicity/multiplicity of proceedings, and is therefore barred by res judicata;

further, the DCSB also contended that the DCSB was unable to perform its contractual obligations of effecting payment of the claimed amount to the GDB due to the measures prescribed under the Covid Act; and

DCSB alleged that GDB had committed a default and repudiatory breach of the PAM Contract, as well as agreements arising from/in connection to the PAM Contract. [15] GDB initiated adjudication proceedings under CIPAA 2012 by issuing a Notice of Adjudication dated 19.5.2023 and registered the adjudication with the Asian International Arbitration Centre (“AIAC”) on 1.6.2023. [16]

GDB’s Adjudication Claim dated 6.7.2023;

DCSB’s Adjudication Response dated 21.7.2023; and

GDB’s Adjudication Reply dated 28.7.2023. [17] Prior to the service of the Payment Claim by GDB, the GDB had previously commenced Adjudication Proceeding 4479 against the DCSB in the sum of RM97,792,870.96, amongst others, being the outstanding certified sums due under the Interim Certificates No. 14 (which was not paid in full) to No. 18. [18] The Adjudication Decision for Adjudication Proceeding 4479 was ready to be delivered on 10.2.2023 (“Adjudication Decision 4479”). However, AIAC informed the parties on 14.2.2023 that since DCSB had failed to pay its shares of the Advance Security Deposit to AIAC, the Adjudication Decision 4479 which was delivered by the Adjudicator on 10.2.2023 is being withheld and will not be released as only GDB has paid its portion under the adjudication proceedings. The said Adjudication Decision will only be released to the Parties once the Advance Security Deposit is fully paid by either party. [19] Due to the continued non-payment by DCSB to AIAC for the Advance Security Deposit, GDB proceeded to make the payment of DCSB’s portion of the Advance Security Deposit, amounting to RM30,300.00 on 24.7.2023, in order to secure the release of the Adjudication Decision 4479. [20] Accordingly, on 26.7.2023, GDB received the Adjudication Decision 4479, which determined, inter alia, that GDB was entitled to its claimed amount therein for Interim Certificates No. 14 (which was not paid in full) to No. 18. [21] In light of the Adjudication Decision 4479, GDB in its Adjudication Reply dated 28.7.2023 had withdrawn the claim for Interim Certificates Nos. 17(R1) and 18 by revising its claim and sought the following revised reliefs and remedies:

The sum of RM55,600,871.81 being the outstanding certified sums due and owing under Interim Certificates No. 19 to No. 24;

Late payment interest pursuant to Clause 30.17 of the PAM Contract in respect of Interim Certificates No. 19 to No. 24, in the sum of RM1,733,828.32;

Late payment interest pursuant to Clause 30.17 of the PAM Contract in respect of Interim Certificates No. 2, No. 3, No. 4R, No. 5, No. 6, No. 7, No. 8R, No. 9, No. 10, No. 11, No. 12, No. 13 and No. 14 (part payment of the certified sums) in the sum of RM1,819,900.21;

Legal costs in the sum of RM50,000.00 (subject to the inclusion of SST);

Adjudication costs incurred for the Adjudication proceedings; and

Any other relief and/or remedy that the Adjudicator may deem fit. [22] Thereafter, DCSB vide its letter dated 1.8.2023 requested to the learned Adjudicator to file a Rejoinder in order to respond to Adjudication Reply as DCSB alleged that there were new arguments and documents raised by GDB (“DCSB’s Request”). DCSB’s Request was based on the following allegations:

GDB’s inclusion of Adjudication Decision No. 4479 in its Adjudication Reply, which GDB used as a basis to withdraw certain claims in the current adjudication proceedings, and to assert that DCSB cannot rely on its defence under the

GDB for the first time disputing the legality of Clause 25.4(d) since the Contract was entered into between the Parties in 2020; and

Accordingly, DCSB contends that it should be given an opportunity to deal with fresh piece of evidence. [23] GDB objected to the DCSB’s Request on 3.8.2023, amongst others, on the following grounds:

The CIPAA 2012 do not provide an automatic right for DCSB in adjudication proceedings to file a Rejoinder.

The issues raised in the Adjudication Reply by the GDB are not new arguments and/or evidence but rather to respond to the DCSB’s allegations in the Adjudication Response.

The Adjudication Decision 4479 was never released at conclusion of Adjudication Proceedings 4479 due to DCSB’s failure to pay its portion of the Advanced Security Deposit for Adjudication Proceedings 4479.

GDB is entitled to rebut the defences raised by DCSB in Adjudication Response by setting out its position in respect of Adjudication Proceedings 4479 in GDB’s Adjudication Reply, and in doing so, GDB is entitled to include the Adjudication Decision 4479 in GDB’s Bundle of Documents herein and make reference to the same.

Further, DCSB was a party to the Adjudication Proceedings 4479 and therefore, DCSB had full knowledge of Adjudication Proceedings 4479 and as well as Adjudication Decision 4479. As such, DCSB cannot be considered as viewing the Adjudication Decision 4479 for the first time during the GDB’s Adjudication Reply.

Consequently, the Adjudication Proceedings 4479 cannot be deemed as new evidence.

Regardless of whether the Adjudication Decision 4479 was released or otherwise, the basis to the allegations raised by DCSB to file a Rejoinder has no relation to the Adjudication Decision 4479 but in fact relates to the defence raised by DCSB in its Adjudication Response in which the DCSB obviously had knowledge of, prior to the release of Adjudication Decision 4479.

Additionally, in respect of Clause 25.4(d) of the PAM Contract 2006, it was DCSB who raised its reliance on the said Clause 25.4(d) for the first time in the Adjudication Response. As such, GDB had the obligation and right to respond and rebut DCSB’s defence in its Adjudication Response.

DCSB should not be given an opportunity to further address as the allegations raised are not new allegations but are merely GDB’s position in rebutting DCSB’s defence. [24] After considering both parties contentions pertaining to DCSB’s Request, the learned Adjudicator, on 10.8.2023, rejected DCSB’s Request and stated that the last day of delivery of the Adjudication Decision pursuant to Section 12(3) falls on 4.10.2023. [25] However, GDB submits that the learned Adjudicator was unable to deliver the Adjudication Decision within 45 working days primarily due to the actions of DCSB. [26] On 11.9.2023, DCSB informed the learned Adjudicator that a Restraining Order had been obtained against DCSB for three months, effective until 1.12.2023. In light of this, the adjudication proceeding, including the delivery of the adjudication decision, was stayed until the expiry of the Restraining Order. The learned Adjudicator, in compliance with the Restraining Order, determined that the timeline for delivering the adjudication decision would resume only after the Restraining Order lapsed. [27] Subsequent to the initial Restraining Order, DCSB and its creditors obtained and/or filed multiple Restraining Orders ("Restraining Orders”) and Judicial Management Applications (“Judicial Management Applications”), further delaying the proceedings. These actions triggered statutory moratoriums under Sections 368 and 410 of the Companies Act 2016, which restrain any legal or quasi-legal proceedings, including adjudication, against DCSB. [28] On 25.7.2024, GDB informed the learned Adjudicator that the final Judicial Management Application had been struck out by the Court, allowing the adjudication proceeding, including the delivery of the Adjudication Decision, to resume. Subsequently, on 29.7.2024, the learned Adjudicator confirmed that the adjudication decision would be delivered on or before 20.8.2024 and directed DCSB to make full payment of its share of the Advance Security Deposit by 2.8.2024. [29] By way of email dated 20.8.2024, the AIAC case counsel for the adjudication proceedings informed Parties that AIAC is in receipt of the Adjudication Decision dated 20.8.2024 issued by the learned Adjudicator, Ranjeeta Kaur (“Adjudication Decision dated 20.8.2024”). [30] On 21.8.2024, GDB made payment of DCSB’s portion of the Advance Security Deposit in the sum of RM55,806.69, to enable the release of the Adjudication Decision (herein defined). Subsequently, on 23.8.2024, GDB paid RM179.23 as the additional 2% service tax to AIAC, in compliance with the revision to the Service Tax Act 2018, which took effect on 1 March 2024. [31] On 26.8.2024, the Adjudication Decision dated 20.8.2024 (“AD”) was released to the Parties in accordance with Section 12(2) of CIPAA

[32] In the Adjudication Decision, the learned Adjudicator determined and decided that the DCSB is liable to pay GDB as per paragraphs 110(f) and 111 of the Adjudication Decision: - “21.2 I determine that: i. The Respondent to make payment of the outstanding certified sums due and owing under Interim Certificates No. 19 to No. 24 in the sum of RM55,600,871.81 to the Claimant; ii. The Respondent to make payment of the late payment interest pursuant to Clause 30.17 of the PAM Contract in respect of Interim Certificates No. 19 to No. 24, in the sum of RM1,733,828.32, which remain due and owing by the Respondent to the Claimant and shall continue to run until full and final payment of the outstanding sum under the aforesaid interim certificates by the Respondent; iii. The Respondent to make payment of the late payment interest pursuant to Clause 30.17 of the PAM Contract in respect of Interim Certificates No. 2, No. 3, No. 4R, No. 5, No. 6, No. 7, No. 8R, No. 9, No. 10, No. 11, No. 12, No. 13 and No. 14 (part payment of the certified sums) in the sum of RM1,819,900.21 as detailed at paragraph 58 of the Adjudication Claim, interim certificates of which the Respondent was previously delayed in making payment of the same to the Claimant and had accrued late payment interest, which remain due and owing by the Respondent to the Claimant; iv. iv. The Respondent to make payment of the Cost of this Adjudication Proceeding as incurred by the Claimant in the sum of RM161,613.38. v. The above amounts as laid out in paragraph 21.2 herein shall be paid on or before 3.9.2024 and in one lump sum and henceforth 3.9.2024 will be called the due date for payment of the said amounts.” Analysis & Findings Failure To Deliver The AD Within The Time Prescribed [33] Under section 12(2) and (3) of CIPAA it is provided that:

Subject to subsection 19(5), the adjudicator shall decide the dispute and deliver the adjudication decision within:-

forty-five working days from the service of the adjudication response or reply to the adjudication response, whichever is later;

forty-five working days from the expiry of the period prescribed for the service of the adjudication response if no adjudication response is received; or

such further time as agreed to by the parties.

An adjudication decision which is not made within the period specified in subsection (2) is void. [34] A perusal of the chronology of events in the CIPAA proceedings will show that the Adjudication Decision (“AD”) was delivered on 26.8.2024. At first glance this will appear to be contrary to section 12

of CIPAA as the AD was not delivered within “forty-five working days from the expiry of the period prescribed for the service of the adjudication response”, which Adjudication Response was served on 28.7.2023, and thus under section 12 (3) of CIPAA the AD would be regarded as void. The contention then is that the Adjudicator allegedly delivered the AD 322 days after the original due date. [35] This is however, not the entire story as it can be seen from the sequence of events which I will list below that after the Adjudication Reply was served on 28.7.2023, the following occurred:

35.1 on 1.9.2023 DCSB obtained a restraining order (“RO”) for a period of 3 months effective until 1.12.2023 which caused the Adjudication proceedings to be stayed until 1.12.2023. Here the Adjudicator had determined the timeline for delivering the AD would resume only after the RO had lapsed;

35.2 on 30.11.2023 DCSB obtained an extended RO to 30.1.2024;

35.3 thereafter DCSB and its creditors had obtained had filed, starting from 7.1.2024, multiple Judicial Management Applications (JM) which further delayed the proceedings; 23 35.4 another RO was obtained on 8.2.2024 which was set aside on 5.4.2024;

35.5 on 25.7.2024, DCSB informed the Adjudicator that the final JM application had been struck out by the Court;

35.6 based on the fact that the Adjudicator was informed on 25.7.2024 that the final JM application had been struck out by the Court, the Adjudicator had on 29.7.2024 confirmed that the AD would be delivered on or before 20.8.2024 to which the Adjudicator had also directed DCSB to make full payment of its portion / share of the Advance Security Deposit by 2.8.2024;

35.7 on 20.8.2024 an email was received from AIAC informing parties that AIAC was in receipt of the AD;

35.8 on 21.8.2024 GDB paid DCSB’s portion of the said Advance Security Deposit to enable release of the AD and on 23.8.2024 GDSB paid the additional 2% service tax to AIAC; 24 35.9 the AD was then released to the parties on 26.8.2024. [36] Under section 368 (which pertains to arrangement and reconstruction) and section 410 (with regards the effect of application for a Judicial Management Order) of the Companies Act 2016 any legal proceedings will be restrained against DCSB. The said sections read as follows:

Where no order has been made or resolution has been passed for the winding up of a company and a compromise or arrangement has been proposed between the company and its creditors or any class of those creditors, the Court may, in addition to any of its powers, on an application in a summary way by the company or any member or creditor of the company, grant a restraining order for a period of not more than three months from the date on which the restraining order is granted. [(1) Subs. by act A1701/2024]

Upon the filing of an application for a restraining order under subsection (1) and until the application is decided by the Court or until the lapse of two months from the date of filing of the application, whichever is earlier-

no order may be made, and no resolution may be passed, for the winding up of the company;

no receiver or receiver and manager may be appointed over any undertaking or property of the company;

no proceedings may be commenced or continued against the company other than the proceedings under section 366, 368C, 368D, 369A or 370 except with the leave of the Court and subject to any terms as the Court may impose;

no execution, distress or other legal process may be commenced, continued or levied against any property of the company except with the leave of the Court and subject to any terms as the Court may impose;

no steps may be taken to enforce any security over any property of the company, or to repossess any goods held by the company under any chattels leasing agreement, hire purchase agreement or retention of title agreement, except with the leave of the Court and subject to any terms as the Court may impose; and

no right of re-entry or forfeiture under any lease in respect of any premises occupied by the company may be enforced except with the leave of the Court and subject to any terms as the Court may impose. Section 410 of the Companies Act 2016 During the period beginning with the making of an application for a judicial management order and ending with the making of such an order or the dismissal of the application:

no resolution shall be passed or order made for the winding up of the company;

no steps shall be taken to enforce any charge on or security over the company's property or to repossess any goods in the company's possession under any hire purchase agreement, chattels leasing agreement or retention of title agreement, except with leave of the Court and subject to such terms as the Court may impose; and

no other proceedings and no execution or other legal process shall be commenced or continued and no distress may be levied against the company or its property except with leave of the Court and subject to such terms as the Court may impose. [37] From the aforesaid chronology of events, it is clear in my view that by the RO’s and JM applications, DCSB had by design or otherwise caused the delay in the AD being delivered. [38] After carefully considering the submissions by both sides on this issue, I hold that the Adjudicator was, in my findings, bound by both section 368 (which pertains to arrangement and reconstruction) and section 410 (with regards the effect of application for a Judicial Management Order) of the Companies Act 2016 with regards any legal proceedings having to be restrained against DCSB during those material periods mentioned i.e from 11.9.2023 whereby a Restraining Order (RO) had been obtained on DCSB till 25.7.2024, when DCSB informed the Adjudicator that the final JM application had been struck out by the Court. [39] A reading of the express wordings in both section 368 and section 410 of the Companies Act 2016 is in my decision explicit in that legal proceedings may not be commenced against DCSB where in regards to the RO, section 368(1A)(c) specifically refers to “(c) no proceedings may be commenced or continued against the company other than the proceedings under section 366, 368C, 368D, 369A or 370 except with the leave of the Court and subject to any terms as the Court may impose;” and in section 410 (c) thereto in respect of the JM it is provided that “(c) no other proceedings and no execution or other legal process shall be commenced or continued and no distress may be levied against the company or its property except with leave of the Court and subject to such terms as the Court may impose.” [40] I note that there is no definition of the word “proceedings’ in either the Companies Act 2016 of in CIPAA 2013 but I hold that the plain, literal and ordinary grammatical meaning of the word “proceedings” in both section 368 and section 410 of the Companies Act 2016 would include any proceedings be it legal or quasi legal including proceedings under CIPAA, and that without the leave of the Court, no proceedings which have been commenced under CIPAA can proceed or continue due to either of the aforesaid sections. For the record, I also find no ambiguity in the word “proceedings” in either section 368 and section 410 of the Companies Act 2016 [41] Section 12 (2) and (3) of CIPAA must be read in light of both section 368 and section 410 of the Companies Act 2016, for to do so otherwise, the aforesaid sections in the Companies Act would not have the intended effect that the said Companies Act would have so intended as the intent of both section 368 and section 410 of the Companies Act 2016, with regards arrangement and reconstruction and JM which are in essence corporate rescue mechanisms under the Companies Act 2016 cannot be achieved. [42] I would also like to refer to and also adopt the case of MRCB Engineering Sdn Bhd v Kuddus Construction Sdn Bhd [2020] 1 1 LNS 29 1780 where Aliza Sulaiman J had held in relation to the word “legal proceedings” that: “[51] Based on all the above-mentioned case authorities and legal references, it is my finding that even if it may be argued that the passages in Ireka Engineering and Jack-In Pile where the Federal Court said that CIPAA is another avenue for the parties to take "legal action" is not the ratio decidendi of the case and that the word "action" in para (a) of Part I, Twelfth Schedule, CA 2016 connotes civil proceedings or a lawsuit brought in a court of law, an adjudication proceeding is nevertheless a "legal proceeding" within the meaning of the said para (a) for the following reasons:

the words "legal proceedings" being left undefined in the CA 2016 and not confined only to "proceeding" as defined in the CJA or with reference to any other Act of Parliament, ought to be given a wider connotation than civil/ judicial proceedings;

the word "proceeding" covers all types of processes before a court, or a tribunal or similar adjudicatory body vested with judicial or quasi-judicial powers with the common denominator being that the forum in question is discharging duties to settle disputes in accordance with the law. The CIPAA introduced a statutory adjudication procedure and impacts the substantive rights of parties to a construction contract. Proceedings which are commenced pursuant to the CIPAA are authorised by law and therefore, must fall within the meaning of "legal proceedings"; and

as a matter of practice, the sanction from the OR is required before a company, which is the subject of a winding up petition, can commence or continue arbitration or adjudication proceedings under the Arbitration Act 2005 [Act 646] or the CIPAA, respectively as well as any proceedings before a tribunal or a quasi-judicial body where the order or award would have an impact on the assets of the wound up company.” [43] Thus, for the aforesaid reasons, there is in my decision no breach occurring under section 12(2) CIPAA due to the AD not being delivered within 45 days of the service of the Adjudication Reply as contended by DCSB. [44] It would be inequitable and indeed unfair and unjust for DCSB to now insist on the AD being delivered within 45 days of the service of the Adjudication Reply as DCSB had themselves reaped the benefits and advantage of the RO’s and the JM applications by not having any proceedings, be it legal or quasi legal, from being commenced or continued against them during the period I had referred to. What is good for the goose is good for the gender and I agree with counsel for GDB that DCSB should not be allowed to approbate and reprobate on their stand with regards the RO’s and the JM applications where DCSB adopted inconsistent positions to rely on the said RO’s and the JM applications where it suited them but now insisted instead that the provisions of CIPPA be observed strictly. [45] Support for this can be obtained from the case of Tenaga Nasional Bhd v Irham Niaga Sdn Bhd & Anor [2011] 1 MLJ 752; [2010] MLJU 103 where the Court of Appeal held: “[71] Estoppel by election is related to the principle that a person may not approbate and reprobate (Lissenden v CAV Bosch, Limited [1940] AC 412 at p 418; [1940] 1 All ER 425 at p 429 (HL)). Thus, a person having a choice between two courses of conduct is to be treated as having made an election from which he cannot resile. But the person will not be regarded as having so elected unless he has taken a benefit under or arising out of the course of conduct which he has first pursued and with which his subsequent conduct is inconsistent with his election (Banque des Marchands de Moscou (Koupetschesky) v Kindersley and another [1951] Ch 112 at pp 119–120; [1950] 2 All ER 549 at p 552(CA); Ex parte Robertson, In re Morton (1875) LR 20 Eq 733; and Evans v Bartlam).” [46] Coming to the decision on this aspect by the Adjudicator, I note that the Adjudicator did also address this in the AD and had specifically referred to “The Respondent had on 11.9.2023 stated the following “Accordingly and pursuant to the Restraining Order, the Respondent trust that this adjudication proceeding (including) delivery of the adjudication decision) is to be stayed immediately until 1.12.2023...” and which the Adjudicator did state in the AD as well that “…the Respondent is not allowed to blow hot and cold admitting in one breath that pursuant to the Restraining Order…this adjudication proceedings is to be stayed immediately and in another breath, stating that the Extended RO do not operate to defer the time lines stated in the CIPAA.” [47] I had in coming to my decision on this issue also considered DCSB’s contention that the Adjudicator had rejected their request vide their letter dated 1.8.2023, for a Rejoinder which I find occurred before the events of the RO and JM’s mentioned eventhough the Adjudicator had at that time mentioned that the AD was to be delivered by 4.10.2023, but this point flies against the chronology of events and is rejected as I hold that DCSB is misconceived on this issue. [48] I further find that the delay in DCSB paying its portion of the said Advance Security Deposit is also a further reason why the Adjudicator only released the AD on 26.8.2024 as section 19(5) of CIPAA provides that:

Before releasing the adjudication decision to the parties, the adjudicator may require full payment of the fees and expenses to be deposited with the Director of the KLRCA. [49] With respect, the decisions relied on by DCSB on the failure to deliver the AD within the time prescribed such as Skyworld Development Sdn Bhd v Zalam Corp Sdn Bhd And Other Appeals [2019] MLJU 162 and CT Indah Construction Sdn Bhd v BHL Gemilang Sdn Bhd [2019] MLJU 1215 are not with respect based on the facts before me applicable in the matter herein as the same can easily be distinguishable with the facts in those cases relied on by DCSB not having the issue of any RO’s or JM’s present therein. [50] Accordingly, I hold that the AD was properly delivered and DCSB’s contention that there is an alleged failure to deliver the AD within the time prescribed does not hold water and is dismissed. Interim Certificate No.24 [51] I now turn to the issue of Interim Certificate No.24 which DCSB claims had not matured and were therefore not due. [52] From the AD I find that the Adjudicator did not deliberate on the applicable payment terms vis a vis Interim Certificate No.24 but had considered the Adjudication Claim, Response and Reply and after perusing the documents and authorities submitted by both sides determined in relation to Interim Certificate No.24 as well as the case laws referred to on this issue and the submissions thereto. [53] After looking at the documents before me, I agree with counsel for GDB that there is no indication that DCSB had contended that the payment terms in GDB’s payment Claim was incorrect i.e the same was not pleaded in the Adjudication proceedings and in fact the said payment terms were not disputed in the Adjudication Response, see paragraph 9 thereto, which was the reason why the Adjudicator did not deliberate on the applicable payment terms vis a vis Interim Certificate No.24. Any issue on this should therefore in my view have been raised by DCSB in the Adjudication proceedings itself. [54] I thus find that DCSB should now be estopped from raising this contention before this Court. [55] Be that as it may, it would appear that the due dates for Interim Certificate No.24 is as outlined in clause 22 of GDB’s Revised Alternative Tender submissions i.e “..within 51 days from the Contractor’s submission of claim” which was not objected to by DCSB and to which I hold the Adjudicator did act within her jurisdiction to determine the same and to which I further hold does not amount to an act which was outside her jurisdiction or in excess of the Adjudicator’s jurisdiction. [56] I would also like to refer and quote Ideal City Development Sdn Bhd v Pwc Bina Sdn Bhd And Other Appeals [2018] MLJU 1711 where the Court of Appeal in relation to the regime for recovery of payment had this to say: “[60] Hence, the first requirement that the payment dispute must state the due date for payment of the sum claimed; that at the time of initiation of the claim, it must be immediately obvious that the payment has been delayed or has not been forthcoming. This is part of the minimums required to trigger the adjudication regime. The merits of such a claim is a matter for the determination of the adjudicator using her inquisitorial powers. …. the validity of the payment claim itself, that it is essential that such a claim is valid in order “to trigger the process which eventually leads to the adjudication proceedings. An invalid payment claim is not capable of crystallizing a dispute which falls within the ambit of the Act.” [57] Following from the aforesaid case authority, I do hold that the claim for Interim Certificate No.24 was ‘triggered’ when the Payment Claim dated 3.5.2023 had referred to the same and to clause 22 of GDB’s Revised Alternative Tender submissions which were allegedly due at the material time. It is also trite that the Adjudicator is confined to matters only in the Payment Claim and Payment Response as per section 27(1) CIPAA and to which has been confirmed by the Federal Court in Anas Construction Sdn Bhd v JKP Sdn Bhd and another appeal [2024] 2 MLJ 543. Rejoinder Application [58] As to the request by DCSB for a Rejoinder to be filed, I hold that there is no breach of natural justice occurring here as I only need to refer to section 25 CIPAA which states that: The adjudicator shall have the powers to:-

establish the procedures in conducting the adjudication proceedings including limiting the submission of documents by the parties; [59] Thus, it is clear that the Adjudicator does have the power and the discretion to disallow the Rejoinder application. Authority for this can also be found in the decision of the Court of Appeal in TSR Bina Sdn Bhd v Sykt Pembenaan Yeoh Tiong Lay Sdn Bhd and another appeal [2024] 4 MLJ 405 where it was held: “[36] As to the procedure to be adopted in the adjudication proceedings, it is clear that under para s 25(a) of the CIPPA the adjudicator shall have the power to establish the procedures that govern the adjudication proceedings, including limiting the submission of documents by the parties. Thus, it is for the adjudicator to decide on the best route map as to how best to establish the facts and the law in an adjudicating proceedings and the adjudicator’s decisions must be consistent with the procedure set to govern the proceedings…. [37] In line with the powers given to the adjudicator under the law, we are constrained to form a view that the adjudicator has the sole discretion as to whether to allow or reject any further response/rejoinder after the filing of the adjudication reply. However, such discretion shall always be subjected to the compliance with the rule of natural justice as required under para s 24(c) of the CIPPA.” [60] In the case before me I note that the Adjudicator did hear both sides arguments on the issue of Rejoinder and only then did the Adjudicator reject the application for a Rejoinder which I find satisfies the rules of natural justice. This is what the Adjudicator had stated in the AD with regards this point “I am satisfied that all parties have had a fair share of presenting their case to me and therefore the Respondent’s request in tier letter dated 1.8.2023 is hereby rejected and due to that there is no reason for me to allow any Rejoinder…” Issue Of Res Judicata [61] DCSB had also contended inter alia that the Adjudicator had improperly ruled on matters of res judicata and the defence that it was unable to perform its contractual obligations due to the Covid 19 Act (Prevention And Control of Infectious Diseases Act 1988). GDB on the other had argues that DCSB should not be entitled on the one had to raise the defence under the Covid 19 Act in the adjudication whilst also contending that the Adjudicator had improperly ruled on matters of res judicata. [62] I note that the Adjudicator had in the AD itself had decided that the claims of res judicata were not applicable as the defence under the Covid 19 Act raised in the Adjudication Proceeding 4479-2022 and that in the case before the Adjudicator here were different. [63] As the application under OS 139 is not a challenge to the merits of the Adjudicator’s decision nor is it an appeal to the same, this Court will not interfere in the Adjudicator’s decision on this point as the Court finds that the Adjudicator had came to her decision on this issue only after due and careful consideration and analysis of the issues and submissions by parties on this point with particular regard to DCSB’s Adjudication Response. [64] In any event, I do find that the defence of Covid 19 in Adjudication Proceeding 4479-2022 had nothing to do with Interim Certificates no 19 to 24 and which relate to a different set of interim certificates that were not previously adjudicated. It is in my view clear that the said Interim Certificates no 19 to 24 did not come into existence in Adjudication Proceeding 4479-2022 and only became due after the service of the Payment Claim in the Adjudication proceedings before me i.e on 5.9.2022. I rely on Sykt Sebati Sdn Bhd v Pengarah Jabatan Perhutanan & Anor [2019] 2 MLJ 689 where the Federal Court held in relation to the elements of res judicata that the following were required: “[34] Firstly, on the issue of res judicata, it is necessary to reiterate the elements which constitute res judicata. For this purpose we find the book Spencer Bower and Turner Res Judicata (3rd Ed, 1996) particularly useful. There the learned authors sets out at p 10, para 19 what is involved in the burden of showing res judicata which consist of six matters:

(i)the decision was judicial in the relevant sense;

(ii)it was in fact pronounced;

(iii)the tribunal had jurisdiction over the parties and the subject matter;

(iv)the decision was — (a) final, and (b) on the merits;

(v)it determined the same questions as that raised in the later question; and

(vi)the parties to the later litigation were either parties to the earlier litigation or their privies, or the earlier decision was in rem. [65] In the circumstances, the Adjudicator is not bound by res judicata in deciding on this issue. Stay of AD [66] As to the application under Enclosure 11 of Originating Summons No. WA-24C-139-09/2024 (OS 139) to stay the AD pending both the disposal of the setting aside application or the disposal of the Arbitration Proceedings under Enclosure1 of OS 139, I hold based on my grounds vis a vis the Setting Aside application, that DCSB has failed to prove to the satisfaction of this Court that there are any ‘special circumstances’ to justify such an application and that there are any ‘clear errors’ in the AD as required and specified by the Federal Court in View Esteem Sdn Bhd v Bina Puri Holdings Berhad [2018] 2 MLJ 22. [67] I would also like to point out and reiterate that any reference of the matter in dispute to Arbitration proceedings itself is no ground to grant a stay under Enclosure 11 and I refer to Bumimetro Construction Sdn Bhd v Mayland Universal Sdn Bhd [2017] 1 LNS 1959 and quote Lee Swee Seng J (as he then was) where His lordship stated: “[24] As is plain to all, to begin Arbitration one needs only to issue a Notice to Arbitrate to the other party and to commence an action where facts are disputed as in most construction disputes, one needs only to file and serve a Writ and Statement of Claim. If by issuing a Notice to Arbitrate or by filing a Writ and Statement of Claim would suffice to get a Stay of the Adjudication Decision, that can only be too easily open to abuse. If a stay of the Adjudication Decision is granted as of right the moment an Arbitration has commenced, then the over-arching purpose of the CIPAA of providing timely and regular payment would be stultified and rendered sterile. That cannot be the intention of the Legislature. If that alone would automatically have the effect of a stay of the Adjudication Decision upon an application under section 16(1)(b) of the CIPAA, it would be tantamount to a backdoor to denude and deplete the Adjudication Decision of its efficacy with the effect of stultifying and stymieing the purpose of the CIPAA which is to provide cash flow for the contractor Claimant who has done its work and is already out-of-pocket. [68] I therefore dismiss the application under enclosure1 with costs. Decision [69] To surmise, I do not find any merits in the contentions raised by DCSB in the matter before me and to quote the UK Court of Appeal in Carillion Construction Ltd v Davenport Royal Dockyard Ltd [2005] EWHC 778 this is, with respect, a case of DCSB “…simply scrabbling around to find some argument however tenous, to resist payment”. [70] I therefore dismiss both Enclosure 1 and Enclosure 11 in Originating Summons No. WA-24C-139-09/2024 with costs and will grant Order in Terms for prayers (a), (b) and (c) in enclosure 1 of Originating Summons No. WA-24C-143-09/2024. Dated: 21st day of April 2025 sgd. NADZARIN WOK NORDIN HIGH COURT JUDGE CONSTRUCTION COURT 1 COUNSEL FOR PLAINTIFF (OS139) / DEFENDANT (OS143): Naveen a/l Sri Kantha, Leong Chee Weng dan Cassandra Woo Ka Yan (Messrs Lee & Poh Partnership] COUNSEL FOR DEFENDANT (OS139) / PLANTIFF (OS143): Allen Cheng Peng Han and Malarvili Kunasegaran (Messrs Azman Davidson & Co.]