Kembang Serantau Sdn Bhd v YBK Usahasama Sdn Bhd (22C-35-09/2015)

Amount Payable to KSSB:

Total Work Done as at 20.7.2012 pursuant to an agreed joint valuation carried out. RM 74,889,919.98

(ii) Less the net omission pursuant to the Interim Final Certificate by the QS as per 4 Appendix A RM 337,297.43

(iii) Less Payment made to KSSB via Interim Certificate 1-13 RM 50,499,258.00 Amount Payable to KSSB (Including Retention Sum RM7,455,262,25) RM 24,053,364.55 [8] The above Settlement Sum was paid subject to the rights of the parties to pursue their respective claims against each other which heads of claims are set out as Part B and Part C of the Deed of Settlement. All pending applications, suits and appeals were also withdrawn. [9] As the parties could not arrive at a settlement on the various heads of claims in Part B and Part C, it is back to the drawing board again with the Plaintiff filing this Claim and the Defendant filing a Counterclaim. Prayers [10] The Plaintiff’s prayers for the various heads of claims are found at paragraph 58 items 1-13, paragraph 59a-e and paragraph 60 of its Statement of Claim. 5 [11] The Defendant’s Counterclaim is at paragraph 39(a) - (t) of its Defence and Counterclaim and prayers (h),(i),(k),(m) had been withdrawn and so struck out. Principles Whether the Plaintiff’s suspension of work under the Contract was unlawful [12] It is true that in the PAM 2006 Conditions of Contract i.e. Clause 30.1 (pg. 72 of BOD B) the Defendant as Employer must certify any progress claim/work within 21 days from the day the Plaintiff submitted its progress claim. Further the contractual period of time stipulates the Defendant to pay within 30 days from such Certification (Refer to clause 30.1 and to the PAM appendix in page 80 of BOD-B). [13] Plaintiff contended that other than Progress Payment No. 3, the Defendant had a habitual practice of delay in certifying the Plaintiff’s progress claims and more so in effecting payments for such certificates. A full record of the chronology has been prepared by the Plaintiff in BOD E pages 8 – 9. [14] The delay in certification and payment worsened at the Progress Claim No. 13 stage. Subsequently, the Plaintiff had issued a Notice of 6 Default dated 29.5.2012 (page 28 of BOD –C) and only henceforth the Defendant then issued a payment for Certificate No. 13 via letter dated 1.6.2012 (Refer to page 30 BOD C) [15] However according to the Plaintiff the payment ordeal was far from over. In addition to the late payment for Certificate No 13, the Defendant was still in breach by their failure to certify the Plaintiff’s progress claim no. 14 which at that point of time had became overdue and exceeded the deadline of 26.5.2012. [16] Plaintiff had further issued several warning letters to the Defendant via letter dated 5.6.2012 (pg 32 BOD C) and letter dated 11.6.2012 (pg 36 BOD C) but to no avail. [17] Due to such adamant position of the Defendant, learned counsel for the Plaintiff said that the Plaintiff was constrained therefore to issue a Suspension Notice dated 18.6.2012 (pg 40 BOD C). The issuance appeared to be the last resort for the Plaintiff since even on 18.6.2012, the Defendant still had yet to certify progress claim no. 14. [18] Despite what might appear to be a drastic step by the Plaintiff in issuing the Suspension Notice, the Plaintiff said that this was the last straw in a series of contumelious conduct on the part of the Defendant in 7 persistently delaying in approving the Progress Claims and issuing the Payment Certificates. [19] The picture the Plaintiff painted was that of patience petering out. Learned counsel for the Plaintiff summarized the following notices of delay previously issued: ITEM DATE PAGE IN BOD C

1.

Plaintiff’s letter recording delay in payment for Progress work 5 & 6 25/8/2011 2 2. Plaintiff’s letter stating delay from progress payment from 1- 6 1/10/2011 3 3. Plaintiff’s letter recording delay in payment 11/10/2011 4 – 6 4. Plaintiff’s letter to Defendant warning on delay of payment 24/10/2011 7-8 5. Plaintiff’s warning to Defendant delay in paying Certificate No. 8 19/12/2011 14 6. Plaintiff’s warning to Defendant Delay in Paying progress No. 8 10/1/2012 19-22 7. Plaintiff’s warning to Defendant on delay in paying Certificate 13 29/5/2012 28-29 8. Plaintiff’s warning to Defendant on delay in certifying No. 14 5/6/2012 32-33 8 9. Plaintiff’s warning to Defendant on failure to certify No. 14 11/6/2012 36-38 10. Plaintiff’s warning on delay to certify and pay No. 14 and Suspension Notice 18/6/2012 40 11. Plaintiff’s elaboration on Suspension Notice 22/6/2012 44-45 12. Plaintiff’s warning to Defendant on delay in certifying Claim No. 15 6/7/2012 79-80 13. Termination by Defendant 13/7/2012 82-84 [20] Under the PAM Contract 2006 the Contractor has the right to suspend its work due to non-payment of its progress claims. Clause 30.7 (page 73 BOD B) under which the Notice of Suspension was issued states as follows: “Suspension for Non Payment”. “…if the employer fails or neglects to pay the contractor the amount due as shown in the payment certificate and continue such default for 14 days from the receipt of such notice, the contractor may by a further written notice delivered by hand or by registered post, forthwith suspend the execution of the works 9 until such time payment is made. Provided always that such notice shall not be given unreasonably or vexatiously.” (emphasis added) [21] Learned counsel for the Plaintiff submitted that there must be non-payment of the amount due in the Payment Certificate from the Defendant beyond the stipulated time frame after the receipt of notice before the issuance of the Notice of Suspension and that the said Notice of Suspension shall not be given unreasonably or vexatiously. [22] Learned counsel for the Plaintiff further emphasized that the Notice of Suspension had been premised on a recurring problem in the Project i.e. Delay in certifying the Progress Claim and delay in honouring the Certificates. The precise words of the Notice of Suspension dated 2.7.2012 from the Plaintiff to the Defendant are important enough to be set out in full and they read as follows with the caption: • Payment of Interim Certificate No. 14 • Suspension of Work. “Referring to our notice previously issued to you dated 18th June 2012, we regret to inform you that it is clear that you had failed to fulfill your obligation to pay us according to the terms enumerated in 10 the Agreement and Conditions of PAM Contract 2006 and therefore we have all the rights to suspend the works at site. PLEASE TAKE NOTICE that with effect from tomorrow, Tuesday, 3rd July 2012, we shall suspend the execution of our works until such time the payment is made to us as provided under Clause 30.7 of the Agreement and Conditions of PAM Contract 2006 (Without Quantities) dated the 30th December 2010).” [23] The Plaintiff by its earlier Notice of Default dated 18.6.2012 had notified the Defendant that it had failed to certify on time and/or honour the Certificate No. 14. Learned counsel for the Plaintiff graphically described such failure by the Defendant to abide with the contractual timeline as “the paralyzing bane to the Plaintiff.” Under Clause 30.1 of the Conditions of Contract in PAM 2006 the Architect is to issue the Interim Certificate within 21 days of receipt of the Plaintiff’s payment application. Learned counsel for the Plaintiff was not unaware of the longer period provided in the Additional Provisions to the Conditions of Contract for the issuance of the Payment Certificate as contrasted below: 11

CLAUSE 30.1 PAM CONDITIONS OF CONTRACT Within 21 days from receipt of progress claim Within 30 days from the issuance of certificate

CLAUSE 68.3 of Additional Provisions of Contract Within 30 days after receipt of progress claim Within 20 days from the issuance of employers certificate of payment DEFENDANT [24] The Notice of Suspension met with an immediate reaction from the Defendant. The Defendant’s Architect of the Project i.e. Landesign Architect, issued a Notice of Default to the Plaintiff invoking Clause 25.1(b) of the Conditions of Contract PAM 2006 declaring the Plaintiff to be in default in that the suspension was without reasonable cause. Landesign Architect denied that its client the Defendant had been in default of Payment as it had under the Contract three (3) months and fourteen (14) days to pay from the date of issuance of the Certificate of Payment, [25] Landesign Architect in that Notice of Default also gave 14 days Notice in that if the Default were to continue for 14 days from the date the 12 Notice of Default is received, then the Employer would initiate action allowable in the Contract. That appears to be the language of Clause 25.2 of Conditions of Contract PAM 2006 on “Procedure for Determination”. [26] The said Notice of Default issued by Landesign Architect to the Plaintiff dated 3.7.2012 is set out below for a full appreciation of its content: “Ref: Cadangan Pembangunan Universiti Teknologi Mara (UiTM) Kampus Jasin di atas PT 1016 (Lot Lama 1005) Mukim Semujuk, Daerah Jasin, Melaka: Contrak No: 2010/YBKU/KSSB/P2 – Notice of Default by the Contractor The above matters, your letter dated 2 July 2012 to Messrs. YBK Usahasama Sdn. Bhd. (YBKU) in suspending the works effective 3 July 2012 kindly refers. Please be reminded that Yg Berbhg Dato’ had agreed that The Employer have a three (3) months and Fourteen (14) days to make payment due to the contractor. As such your referred letter informing suspension of work is in breach of clause 25.1(b) of PAM condition of contract. 13 Your office had to date also fail to comply to various AI issued (duly attached) apart from the many non-compliance report (duly attached) still unattended with some requires various rectification work with the method of rectification requires prior approval from the consultant. The number of workforce also had been reduced significantly since June 2012. As such it is necessary for us to serve notice that Kembang Serantau Sdn. Bhd. is in default of clause 25.1 of the contract. Should Kembang Serantau Sdn. Bhd. continue to be in default for 14 days from receiving this notice, the Employer will initiate action allowable in the contract.” (emphasis added) [27] Learned counsel for the Plaintiff maintained that the Plaintiff’s Suspension of the Works was not unlawful or without reasonable cause and listed the chronology of key events with respect to Progress Claim No.14 to prove the point as follows: ITEM DATE PAGES IN

Plaintiff’s warning to Defendant on delay in certifying No. 14 5/6/2012 32-33

Plaintiff’s warning to Defendant on failure to certify No. 14 11/6/2012 36-38 10 Plaintiff’s warning on delay to certify and pay No. 14 and Suspension Notice 18/6/2012 40 11 Plaintiff’s elaboration on Suspension Notice 22/6/2012 44-45 12 Plaintiff’s warning to Defendant on delay in certifying Claim No. 15 6/7/2012 79-80 [28] The Plaintiff’s stand is that the suspension of the Works was lawful and reasonable for repeated failure of the Defendant to certify and pay on time and in particular Certificate No. 14 and therefore the termination by the Defendant on ground of unreasonable suspension was misconceived and improper. Learned counsel for the Plaintiff then sought to prevail upon this Court that the termination by the Defendant subsequently by their Notice of Termination dated 13.7,2012 was unlawful and invalid. [29] It is now clear where the difference and divergence lie. The Plaintiff maintains that the authoritative contractual terms for certification process and payment are under the PAM Conditions of Contract (Refer BOD B from page 28 to page 81) whereas the Defendant’s position is that the “Additional Provisions to the Contract Agreement” containing the 15 “Additional Provisions to the Conditions of Contract” at pages 82-184 BOD B, prevails. [30] The conflict cannot be more contrasting. Under Clause 30.1 of The Conditions of Contract of the PAM Contract 2006 the Certification by the Architect is within 21 days of receipt of the Contractor’s Progress Claim and Payment is to be made within the period of honoring the Certificate which is 30 days as stated in the Appendix to Clause 30.1. Under Clause 68.3 of the “Additional Provisions to the Conditions of Contract” the Employer is to certify the amount to be paid to the Contractor within 30 days of submission of the Contractor’s monthly statement. That Certificate of Payment is to be endorsed by the Independent Checking Engineer (“ICE”) appointed and only after the said endorsement is payment due within 20 days. It is to be noted that there is no time frame within which the ICE shall give its endorsement. Under Clause 72.1(a) of the “Additional Provisions to the Conditions of Contract” it is only after the Employer has failed to pay the Contractor within 3 months of the due date that the Contractor may give another 14 days written Notice to the Employer to remedy the breach before the Contractor has the right to terminate the Contract for non-payment of a Payment Certificate duly endorsed by the ICE. 16 [31] Clearly the 2 terms of when a Payment Certificate is due and when the Employer is in Default for non-payment are in conflict. The Defendant had repeatedly informed the Plaintiff of the enforcement of the Additional Provisions to the Conditions of Contract as follows: DATE OF DEFENDANTS PAGE IN BUNDLE 4/11/2011 Page 9 BOD C 21/6/2012 Page 41 BOD C 27/6/2012 Page 48 [32] How then is this conflict to be resolved? The parties have already provided for that in the expressed terms in the Letters of Award as well as in the “Additional Provisions to the Conditions of Contract” and also in the PAM 2006 Contract itself. [33] It may fairly be stated that the Contract Documents duly agreed and executed by the Plaintiff and the Defendant consisted of the following:

The Letter of Award dated 2.7.2010 for Enabling Works (Package 1) pages 1 – 3 Bundle B2/CBD pages 1 - 13. 17

The Addendum dated 9.12.2010 to the Letter of Award dated 2.7.2010 (Package 1) pages 14 – 18 Bundle B2/CBD pages 14 - 18.

The Letter of Award dated 2.7.2010 for Building and Associated Works (Package 2) pages 7 – 21 Bundle B/CBD pages 19 - 35.

The Addendum dated 9.12.2010 to the Letter of Award dated 2.7.2010 (Package 2) pages 23 – 26 Bundle B/CBD pages 36 - 40.

The Additional Provisions to the Contract Agreement (“Additional Conditions of Contract”) pages 82 – 184 Bundle B/CBD pages 96 -

199.

The PAM Conditions of Contract (Without Quantities) “PAM Contract” pages 28 – 86 Bundle B/CBD pages 41 - 95. [34] To begin with, the 2 Letters of Award dated 2.7.2010 have Clauses 3.3 - 3.5 in the Letter of Award for Enabling Works (Package 1 of the Project) and Clauses 3.3 - 3.4 in the Letter of Award for Building & Associates Works (Package 2 of the Project); the latter is identical to Clause 3.3 - 3.5 of the Letter of Award for Enabling Works, wherein reference was made to the “attached Conditions of Contract”. Clauses 3.3 -

3.5 of the Letter of Award for Enabling Works (Package 1 of the Project) are set out below: 18 “3.3 Save as otherwise provided herein, in addition to all terms and conditions of the Agreement and Conditions of Building Contract Private Edition Without Quantities issued under the sanction and approval of Pertubuhan Akitek Malaysia Edition 2006 (“the PAM Conditions of Contract of Contract”), the attached Conditions of Contract shall apply to this Letter of Award.

3.4 The provisions in the attached Conditions of Contract are in amplification and form an integral part of this Letter of Award.

3.5 You acknowledge that the PAM Conditions of a Contract have been extended and/or modified pursuant to the contract documents by the inclusion of the provisions herein provided.” (emphasis added) [35] Learned counsel for the Plaintiff submitted that by “attached Conditions of Contract” is meant the Conditions of Contract in the PAM 2006 Contract from Clauses 1.0 - 38.1 of the Conditions of Contract from BOD B in pages 27-86. [36] That, I am afraid, would go against the grain of the descriptive words and references made to the “attached Conditions of Contract” in contradistinction to the PAM Conditions of Contract as in Clause 3.3 above. 19 The above Clauses referred to would be so incoherent if by the “attached Conditions of Contract” is meant the PAM Conditions of Contract. The expressions “in addition to” in Clause 3.3, the “amplification” in Clause 3.4 and the “have been extended/modified” in Clause 3.5 would have been so clumsily placed with no coherence to the sentence structure and syntax. [37] Without doubt the expression “in addition to” in Clause 3.3 is to indicate that the parties have found the base contract document i.e. the PAM Contract 2006 to be inadequate for the present purpose of the Project such that the “attached Conditions of Contract” had become necessary to both supplement and complement the PAM Contract 2006. [38] When one looks at what was attached the said document is entitled “Additional Provisions to the Contract Agreement” at page 82 and 84 BOD B and at page 85 are found the words “ADDITIONAL PROVISIONS TO THE CONDITIONS OF CONTRACT,” running from pages 85-184 where at page 184 both the parties had signed. [39] It is not uncommon for parties to a construction contract to use a base document which is normally a standard form contract prescribed by the industry body be it PAM, IEM, PWD, CIDB and more recently KLRCA Standard Form Agreement on top of the Letter of Award and then to 20 supplement it with additional terms and conditions specially crafted and grafted into the base contract to form the total Contract Documents. [40] Conflicts in the Clauses are bound to appear and generally the terms and conditions in the Additional Conditions of Contract would prevail for naturally why would anyone expend extra effort to add to an existing standard form agreement terms and conditions that do not prevail over an already existing terms and conditions in the standard form? [41] The use of the device of “Priority of Documents” Clause is to address this more than likely conflict such that what had been thought through and tailored to meet the particular and peculiar needs of Project stakeholders would prevail over the general terms in a standard form contract in whose terms the parties have their confidence as forming the base of the Additional Conditions of Contract where these Additional Conditions are silent. [42] Clause 5.3 of the “Additional Provisions to the Conditions of Contract” addressed the “Priority of Documents” as follows: “Priority of Documents 21 This Contract comprises of the following documents and in the event of any conflict between or among the documents the order of priority shall be in the order that they appear, which is as follows:

the Letter of Award and these conditions as attached to it;

(ii) such further documents as the parties may agree and which are signed on behalf of both parties to identify them as documents forming part of the Contract;

(iii) followed by the sequence of priority as provided in the PAM Conditions of Contract.” [43] It is as clear as broad daylight that the “Additional Provisions to the Conditions of Contract” commonly referred to as the “Additional Conditions of Contract” or just “Conditions of Contract” would prevail over the PAM Conditions of Contract. [44] The question of which terms prevail may be easily answered by looking at the Clause 3.0 from the Conditions of Contract PAM 2006 at page 44 of the BOD B. [45] It does not matter that under Clause 3.1 of the PAM Conditions of Contract the Priority in descending order is as follows: 1) Letter of Award 2) 22 Articles of Agreement 3) Conditions of Contract 4) Contract Drawings 5) Contract Bills 6) Other documents incorporated in the Contract Documents. [46] Once the latter documents in the “Additional Conditions of Contract” had stated and sorted out the order of “Priority of Documents” that latter Documents would prevail over the earlier documents unless otherwise stated. [47] Learned counsel for the Plaintiff seemed to see some significance or rather the less of it when these “Additional Provisions to the Contract Agreement” are placed from pages 82 - 184 BOD B rather than in front like the PAM 2006 Contract from 28-81 BOD B but surely that kind of sequencing documents for purposes of numbering and binding cannot take precedence over the “Priority of Documents” expressly stated. [48] Learned counsel for the Plaintiff also suggested that priority should generally be given to agreements in official format prepared by professional bodies like the Persatuan Akitek Malaysia (PAM) rather than the Additional Terms and Conditions prepared privately by the parties but I fail to see any basis for that proposition. As I said before, the Additional Terms and Conditions often arise because the general format in the standard form contract of PAM for instance might not cater to the particular need of the 23 parties and so they sought a variation to it. Rather than crossing out the terms and conditions in the PAM 2006 Contract and underlining the Additional Terms and Conditions as one would do in the case of Amendment of Pleadings, those in the Construction Industry have a more efficient and effective method by way of setting out by the device of “Priority of Documents” such that in the event of conflict, the parties already know which contractual documents would prevail. That is both purposeful and practical. [49] Whilst it may be true as in the present case where the Additional Provisions to the Contract Agreement are prepared by the Defendant as Employer, ultimately it is for the Plaintiff as Contractor to assent if not accede to those Additional Terms and Conditions. One is not talking of inequality of bargaining powers here for the Contractor is free to walk away without any explanation if the Additional Terms and Conditions are too onerous for its liking. Having signed it the Contractor cannot then say that they still prefer and want the PAM 2006 Conditions of Contract to prevail in the event of conflict. In any event the Plaintiff had not pleaded inequality of bargaining power on the part of the Plaintiff. [50] So as here when there is a conflict between Clause 30.1 of the Conditions of Contract PAM 2006 Contract with respect to payment period 24 once certification is issued with Clause 68.3 of the Additional Conditions of Contract, the latter would prevail. [51] As outlined by learned counsel for the Defendant, the Plaintiff submitted the Progress Claim No. 14 (Package 1) to SMPM, the Project Management Company under the Contract, on 2.5.2012 and duly received by the Architect on 3.5.2012. (Bundle Q page 466) / CBD page 201. [52] The Plaintiff submitted the Progress Claim No. 14 (Package 2) to SMPM, on 28.4.2012 and there is no acknowledgment of receipt by the Architect noted. (Bundle Q page 466) / CBD page 202. [53] Assuming Interim Certificate No. 14 for Package 2 was also received by the Architect on 3.5.2012 hence under the PAM Conditions of Contract, the Interim Certificate No. 14 ought to be issued on or before 24.5.2012 (i.e. within 21 days). On the other hand, under the Additional Provisions to the Conditions of Contract, the Interim Certificate No. 14 ought to be issued on or before 2.6.2012 (within 30 days). [54] On the given facts, as pointed out by learned counsel for the Defendant, Interim Certificate No. 14 for both Package 1 & 2 was certified on 29.6.2012 (Bundle J pages 1068 & 1075) / CBD pages 250 & 257 as there is a need for the ICE to independently verify the Works and endorse 25 the Certificate before it can be issued. The Defendant had given its reasons for the delay in certification which they said was due to the Plaintiff not complying with the Architect’s Instructions (AI) but it is not necessary to delve into that at this stage. [55] I agree with the analysis of learned counsel for the Defendant that under the PAM Conditions of Contract, Interim Certificate No. 14 for Package 1 & 2 having been certified on 29.6.2012 (Bundle J Pages 1068 and 1075 refers)/CBD pages 250 - 257, it is due for payment on 28.7.2012. [56] Under the Additional Provisions to the Conditions of Contract, the Defendant vide their letter dated 28.6.2012 (at page 821 Bundle I)/CBD pages 240 - 241 had informed the Plaintiff to collect the Interim Certificate No. 14 from the Defendant’s office on 29.6.2012. Under the Additional Provisions to the Conditions of Contract, Interim Certificate No. 14 will be due for payment on 19.7.2012. Further, the Defendant will be in default of payment on Interim Certificate No. 14 upon expiry of 3 months and 14 days i.e. on or about 2.10.2012. [57] I would therefore agree with the Defendant that the Defendant is not in breach of the agreed terms be it under the PAM or the Additional Provisions to the Conditions of Contract in respect of honouring the 26 payment for Interim Certificate No. 14 when the Plaintiff suspended the works at Site effective 3.7.2012 for non-payment of Interim Certificate No.

[58] It must be noted that the complaint of Default of the Plaintiff is not on the delay in certification but delay in payment of Interim Certificate No. 14 as stated in the caption to the Notice of Default dated 2.7.2012. [59] As such, as unpleasant as the results may be, contractually the Plaintiff as Contractor has no right to suspend works on 3.7.2012. Whether the Defendant as Employer has the right to terminate the Contract when the wrongful suspension has not continued for 14 days under Clause 25.2 of the Conditions of Contract of the PAM 2006 Contract [60] As stated, Landesign, the Defendant’s Architect had issued on 3.7.2012 a Notice of Default by the Contractor in its immediate response to the Contractor’s Notice of Suspension of Works of 2.7.2012. [61] Landesign stated in the said Notice of Default that the Plaintiff was in breach of Clause 25.1(b) of the Conditions of Contract of the PAM 2006 Contract for without reasonable cause suspending the Works. 27 [62] However after giving the Plaintiff the 14 Days period presumably to rectify the breach for the breach must continue for 14 days at least before the Defendant could terminate the Contract, the Defendant as Employer terminated the Contract by their letter to the Plaintiff dated 13.7.2012 with immediate effect, the said Letter of Termination having been received the same day by the Plaintiff. To be sure the said Letter of Termination referred to the Notice of Suspension dated 2.7.2012. [63] That simply would not do. As the termination of a Contract has serious consequences, the party terminating must follow the strict procedure prescribed in the Contract. Having given 14 days to the Plaintiff through its agent Landesign, the Defendant cannot now resile from that and terminate before the expiry of the 14 days by which time the default of wrongful suspension of works by the Plaintiff as Contractor would not have continued for at least 14 days. [64] The termination was 4 days earlier than allowed for contractually under the provisions cited by the Defendant’s Architect under Clause 25.2 of the PAM 2006 Contract. Such a termination is wrong in law for non-compliance with the procedure for termination which procedure must be strictly complied with. 28 [65] Unpleasant as the consequences are, this Court must give effect to it as the rights of the parties to terminate as well as the corresponding right to rectify the breach are governed by the terms of the Contract and must be strictly followed. There is no intervening event here. Moreover 2 wrongs do not make a right! The fact that the Plaintiff was wrong in suspending the Works does not justify the Defendant terminating the Contract before the continuing default of 14 days are up. [66] The strictness of the time frame can be seen in the fact that under Clause 25.2 of the PAM Contract 2006 the Employer “may, within ten (10) Days from the expiry of the said fourteen (14) Days, by a further written notice delivered by hand or by registered post, forthwith determine the employment of the Contractor under the Contract.” It is a case where premature termination before the continuing default of 14 days is as bad and as ineffective and unlawful as a termination post the 10 days after the continuing default of 14 days. [67] Learned counsel for the Defendant submitted that under the “Additional Provisions to the Contract Agreement” and in the “Additional Provisions to Conditions of Contract” there is no provision for suspension of works by the Contractor for non-payment unlike the PAM Conditions of Contract. 29 [68] With respect I would disagree as the right to suspend Works is not only found in Clause 25.1 of the PAM 2006 Contract which is undeniably part of the Contract Documents but also implied under Clause 69.1(b) under Contractor’s Default of the Additional Conditions of Contract, when it referred to “...or has suspended the progress of the Works for sixty (60) Days other than as expressly permitted by the Contract.” [69] Thus I would respectfully disagree with learned counsel for the Defendant when she submitted that under the Additional Conditions of Contract at Clause 72.1 the Contractor’s only remedy for non-payment is to determine the Contract and the right to be paid for all works executed prior to the termination pursuant to Clause 72.2. (Bundle B2 pages 163 refers) / CBD pages 41 - 95. [70] There is no good reason why Clause 30.7 of the PAM 2006 Contract on the Contractor’s right to suspend Works for non-payment could not be read harmoniously with Clause 72.1 on the Termination of the Contract for Default by the Employer under the Additional Conditions of Contract. [71] The termination of the Contract by the Defendant before the continuing default of 14 days given to the Plaintiff was therefore invalid, wrongful and unlawful. 30 Whether the Letter of Termination of 13.7.2017 with immediate effect is nevertheless valid under Clause 69.1 of the Additional Provisions to the Conditions of Contract [72] Learned counsel for the Defendant contended that the termination vide the Letter of Termination dated 13.7.2012 is nevertheless valid on account of repudiatory breach on the part of the Plaintiff as Contractor pursuant to Clause 69.1 of the Additional Provisions to Conditions of Contract. Learned counsel for the Defendant had reproduced below what is relevant with respect to Clause 69.1 as follows: “Contractor’s Default If the Contractor shall assign the Contract other than as permitted by the Contract, or if the Employer shall be entitled to terminate pursuant to Clause 28 or if the Contractor; ...

despite a previous warning by the Employer in writing given not more than sixty (60) Days prior to notice of breach, is continuing to fail to proceed with the works with due diligence or is otherwise persistently or fundamentally in 31 breach of any of his material obligations under the contract; or ... Then, the Contractor shall be deemed to be in breach of the Contract and without prejudice to any other rights and remedies of the Employer, the Employer may give notice to the Contractor specifying such breach. If within forty five (45) Days in respect of Clauses 69.1 (a), (c), (d), (e) and (f) and fourteen (14) Days in respect of Clause 69.1 (b) only, of such notice, the Contractor shall have failed to remedy the breach to the satisfaction of the Employer, the Employer may enter upon the Site and the Works thereon and expel the Contractor therefrom without thereby avoiding the Contract or releasing the Contractor from any his obligations or liabilities under the Contract or affecting the rights and powers conferred on the Employer by the Contract and may himself complete the works or may employ any other contractor or contractors to complete the Works.” [73] Learned counsel for the Defendant had conveniently left out Clause 69.1(b) which reads that if the Contractor (b) without reasonable excuse ...has suspended the progress of the Works for sixty (60) Days other than as expressly permitted by the Contract.” (emphasis added) 32 [74] The Defendant submitted that under Clause 69.1 (d) the following requirements must be met to enable the Defendant to expel the Plaintiff forthwith:

The Contractor is persistently or fundamentally in breach of any of his material obligation under the Contract.

(ii) The deeming provision is triggered once there is a breach of Clause 69.1 (d).

(iii) There is no requirement for any notice for the deeming provision to take effect.

(iv) The Employer may give notice specifying such breach and if within 45 days of such notice, the Contractor shall have failed to remedy the breach to the satisfaction of the Employer, the Employer may enter upon the Site and the Works and expel the Contractor. At this juncture, it is important to take note that the aforesaid notice is not mandatory since the said Clause reads “… without prejudice to any other rights and remedy of the Employer, the Employer may give notice to the Contractor specifying such breach …”. Further, the notice can be given by the Employer and/or the Employer’s Representative since the 33 definition of Employer in the Additional Conditions of Contract includes the Employer’s duly appointed representatives. (emphasis added)

There is no requirement for any notice for the Employer to expel the Contractor and the provision to expel is thus forthwith. (emphasis added) [75] I do not agree with the purported termination of the Contract by the Defendant under Clause 69.1 (d) above as the said Clause must be specifically invoked and the actual breach complained of spelt out in the Notice of Breach. Is it a case of the Plaintiff failing to proceed with the Works with due diligence? Is it a case of the Plaintiff persistently or fundamentally in breach of any of his material obligations under the Contract? [76] It is not enough and certainly too vague a Termination Letter without due notice and with immediate effect to refer to the following as the ground for immediate Termination without Notice. The Letter of Termination of 13.7.2012 is important enough to be set out in full below: “We refer to the Notice of Default by the Contractor issued by Landesign Architect dated 3.7.2012 in respect of the above matter. 34 We further refer to your letter dated 11.6.2012 on the Notice Refer To Arbitration and your letter dated 18.6.2012 on Notice of Suspension of Works followed by your letter dated 2.7.2012 wherein your goodselves suspended execution of all works and directed all your sub-contractors to equally suspend works. Your conduct in suspending all works affirms your intention not to carry out your primary obligation to proceed regularly and/or diligently with the works. Your refusal not to be bound by the Contract Documents, your blatant non compliance with the architect’s Instructions and suspending all works without a valid legal cause is itself a repudiatory breach which entitles us to invoke our rights of termination without any further notice. Despite our letters dated 19.6.2012 and 27.6.2012 reiterating the agreed terms between the parties in the Contract Documents, your good selves vide your letters dated 25.6.2012 ... and 6.7.2012 have clearly evinced your intention not to be bound by the agreed terms in the Contract Documents. As such your continued act to suspend works at the site is clearly in breach of the Concession Agreement dated 4.5.2010 which you have agreed to observe, perform and comply vide Clause 1.7 in the Additional Provisions to the 35 Conditions of Contract. The Concession Agreement expressly stipulates that the Concession Company i.e. YBKU would be in default during the construction period if there is a continuous period of 30 calendar days of suspension of Works or any part thereof. Under the circumstances, and in view of your apparent and expressed intention and conduct not to adhere and be bound by the Contract Documents, we have no alternative but to terminate your goodselves as the Main Contractor for Package 2 – Building and Associated Works and Package 1 – Enabling Works for the abovementioned Project. PLEASE TAKE NOTICE that effective from service of this Letter of Termination you are hereby terminated as the Main Contractor for Package 2 – Building and Associated Works and Package 1 – Enabling Works for the abovementioned Project. You are hereby instructed to vacate the Site and return possession of the Site to YBKU with immediate effect. PLEASE TAKE FURTHER NOTICE that upon service of this Letter of Termination on your goodselves, it is the responsibility of YBKU as the Concession Company to protect and maintain 36 the Project Site and Land until completion of the Project. We will not tolerate any interference of our rights and your goodselves will be notified in writing by the Architect for a joint inspection of the Site to determine the extent of your works executed and the materials and goods delivered to the Site.” (emphasis added) [77] I do not agree with the Defendant that when it is stated that: “....the Employer may give notice to the Contractor specifying such breach. If within forty five (45) Days in respect of Clauses 69.1 (a), (c), (d), (e) and

and fourteen (14) Days in respect of Clause 69.1 (b) only, of such notice, the Contractor shall have failed to remedy the breach to the satisfaction of the Employer, the Employer may enter upon the Site and the Works thereon and expel the Contractor...”; it means that anytime within the said 45 days or 14 days as the case may be, from the date the Defendant gives Notice to specify the breach, the Defendant may terminate the Contract with immediate effect without further Notice and enter into possession of the Site and expel the Contractor. [78] The 45 days or 14 days as the case may be must be interpreted to mean that the Defendant has within that period to remedy its breach for otherwise the time frame would be devoid of meaning. It would mean that today the Defendant may give Notice of Default and the next day 37 terminates the Contract. I would attribute it more to poor drafting than anything else. [79] In Investors Compensation Scheme Ltd v West Bromwich Building Society [1998] 1 WLR 896 at 912-913, it was held as follows: “The ‘rule’ that words should be given their ‘natural and ordinary meaning’ reflects the common sense proposition that we do not easily accept that people have made linguistic mistakes, particularly in formal documents. On the other hand, if one would nevertheless conclude from the background that something must have gone wrong with the language, the law does not require judges to attribute to the parties an intention which they plainly could not have had. Lord Diplock made this point more vigorously when he said in Antaios Compania Naveira SA v Salen Rederrierna AB [1985] AC 191, 201: If detailed semantic and syntactical analysis of words in commercial contract is going to lead to conclusion that flouts common sense, it must be made to yield to business common sense.” (emphasis added) 38 [80] The above approach was applied by the Federal Court in SPM Membrane Switch Sdn Bhd v Kerajaan Negeri Selangor [2016] 1 MLJ 464 at 478-479 and by the Court of Appeal in Cheah Sin Choon v Tan Lye Hock [2017] MLJU 1071. [81] Further I do not agree that this is a case of a breach under Clause 69.1(d) but primarily and predominantly a breach under Clause 69.1(b) for suspending the progress of the Works and for that the suspension must have continued for 60 days. [82] Here the suspension started only on 3.7.2012 and the termination was effected on 13.7.2012 and I could not see how the 60 days of suspension has continued before there could be termination. At best this is a valiant attempt to salvage the Termination of the Contract by the Defendant but falls short of the strict procedure that parties have agreed with respect to termination with regard to Notice period. [83] The Defendant’s purported Letter of Termination is invalid, wrongful and unlawful even under the Additional Conditions of Contract under Clause 69.1(b) thereof. 39 Whether the Defendant can rely on its common law rights to terminate the Plaintiff without Notice on ground of the Plaintiff having repudiated the Contract [84] As it transpired, learned counsel for the Defendant had a motive in pursuing the argument that the Plaintiff had no right to suspend works for non-payment of the Interim Certificates of Payments. It is to set the stage for her subsequent submission, when not without some seriousness, she contended that the suspension of Works by the Plaintiff as Contractor would amount to repudiation of the Contract which entitled the Defendant as Employer to terminate without further notice as stated in paragraph 2 of the Letter of Termination. [85] I can accept the submission of learned counsel for the Defendant that the Defendant’s right to terminate the Contract is preserved with the inclusion of the clause below in Clause 69.1 of the Additional Conditions of Contract as follows: “... the Contractor shall be deemed to be in breach of the Contract and without prejudice to any other rights and remedies of the Employer, ...” (emphasis added) 40 [86] However in exercising that common law right the Employer cannot itself breach the Notice period contractually agreed whether it be the Notice period to rectify breach or the period of continuance of the breach by the Contractor before the termination. The other rights and remedies in common law cannot be exercised to deny the Contractor of its contractually agreed rights. Otherwise the contractual terms would be denuded and be devoid of meaning or worse still, there could be a breach of it by the Employer and yet the Contractor cannot defend against the termination. An Employer cannot under the guise of its common law rights breach its contractual obligations to comply with the Notice Period prescribed or to forgo it altogether. [87] Thus after having given the Plaintiff 14 days to consider resuming work on ground of wrongful suspension, the Defendant would be estopped from now asserting that the 14 days period can be ignored by it and the termination can be effected even before the 14 days is over. [88] Where as in this case the parties have agreed to the contractually agreed period of 14 days under Clause 25.2 of the PAM 2006 Contract or 60 days under the Additional Conditions of Contract, then it is not for the Defendant as Employer to say that there has been repudiatory breach before the time was up. 41 [89] Our local jurisprudence on this can be found in the case of Malayan Flour Mills Sdn Bhd v Raja Lope & Tan Co and Another [1998] 6 MLJ 377, though overruled on appeal, it was more on the point of the learned High Court Judge having exercised appellate jurisdiction in a setting aside of the Arbitral Award. There is also the High Court case of SK Styroform v Pembinaan LCL [2004] 5 MLJ 385. [90] Learned counsel for the Defendant referred to the case of Architectural Installation Services Ltd v James Gibbons Windows Ltd [2004] 46 BLR 91. The plaintiffs there were labour-only sub-contractors to the defendants under a contract made on 22 July 1985. Condition 8 stated that the sub-contract could be terminated if the main contract was determined, or if the sub-contractor went into liquidation or “if the sub-contractor wholly suspends the works or fails to proceed with the works expeditiously or to the satisfaction of the main contractor or to remedy defective work and remains in default for seven days after being given notice in writing thereof by the main contractor.” [91] Condition 20 of the sub-contract provided for the hours of work. On 20 September 1985, the defendants notified the plaintiffs that they required compliance with condition 20. On 21 August 1986 the defendants purported 42 to terminate the contract “by reason of your withdrawal of labour from the above contract without sufficient notice to ourselves”. [92] The plaintiffs’ action was for the balance of money alleged to be due and damages for wrongful termination of the contract; the defendants counter claimed that they were entitled to terminate the contract and claimed damages for defective work. [93] It was held that a Notice in writing of a default under condition 8 was required before there could be a termination on the grounds set out in sub-clause (c) of that clause. Here Notice was already given in September

However the Court held that it was necessary for there to be a sensible connection both in content and in time between the notice of default and any termination notice. [94] It was further held that the notice of 20 September 1985 was a valid notice of default under condition 8 but since it was not sensibly connected with the defendants’ notice of 21 August 1986 purporting to terminate the contract, the defendants had not validly determined the contract on accordance with the provisions of condition 8. [95] It was in that context and against that backdrop that the Court went on to hold that there was no reason for the implication of any term to the 43 effect that condition 8 of the contract was to be the only machinery for terminating the contract, to the exclusion of common law rights of termination. Accordingly the defendants’ common law rights continued to exist side by side with clause 8. As such the termination of 21 August 1986 was valid termination under common law. [96] The approach taken by the Court at page 100 is to be welcomed: “I would be sorry if the draftsmen of contracts felt it necessary to include such legal verbiage in order to avoid unintended results of their drafting. Construction contracts are already sufficiently complicated when the draftsmen seek to state what they do mean. They should not be burdened with the additional task of stating what they do not mean. When someone has obviously gone to a great deal of trouble to draft a contract, and two commercial parties have agreed to a contract in those terms, the court should be very reluctant to step in and suggest that those two parties also agreed something which was not written down in the agreement between them.” [97] The Judge had in mind a clear repudiatory breach in the example he gave where a contractor had said “we are leaving the site and we shall not return and we shall not change our minds about this” in such a case an 44 Employer would clearly not have to go through the two notice procedure to terminate the contract. [98] Let it be said that this is not the case in the present dispute. There was no evidence that the Plaintiff had evinced an intention not to resume work altogether especially when the Certificate of Payment No. 14 had been issued and collected before the Letter of Termination. [99] Learned counsel for the Defendant also referred to the House of Lords majority decision in Mannai Investment Co. Ltd. v Eagle Star Life Assurance Co. Ltd [1997] A.C. 749. The appeal was concerned with the question whether a notice given by a tenant pursuant to a break clause in a lease was an effective notice. In fact, there were two leases with identical break clause, and two identical notices were given. The premises were in Jermyn Street in London. The lease was dated 11 March 1992, and was for a term of 10 years from 13 January 1992. The respondent company was the landlord, and the appellant company was the tenant. The relevant clause was clause 7(13), which provided as follows: “The tenant may by serving not less than six months’ notice in writing on the landlord or its solicitors such notice to expire on the third anniversary of the term commencement date determine this lease 45 and upon expiry of such notice this lease shall cease and determine and have no further effect…” [100] So the clause gave the tenant a single opportunity to bring the lease to an end. It so happened that the market for rents in this area had fallen, and the tenant decided to take advantage of this opportunity. It served the following notice on the landlord: “Pursuant to clause 7(13) of the lease we as tenant hereby give notice to you to determine the lease on 12 January 1995 …” [101] Unfortunately, however, the tenant made a mistake. The third anniversary of the term commencement date was not 12 January 1995 but 13 January 1995. The landlord has claimed that in the result the notice was ineffective. The Court of Appeal, reversing the decision of Judge Rich Q.C. (sitting as an additional judge of the Chancery Division), upheld the landlord’s contention. It is from that decision that the tenant appealed to the House of Lords which allowed the appeal (Lord Goff of Chieveley and Lord Jauncey of Tullichettle dissenting). [102] The House or Lords by a majority held that the construction of the notices had to be approached objectively, and the question was how a reasonable recipient would have understood them, bearing in mind their 46 context; that the purpose of the notices was to inform the landlord of the tenant’s decision to determine the leases in accordance with the break clauses; that a reasonable recipient with knowledge of the terms of the leases and of the third anniversary date would have been left in no doubt that the tenant wished to determine the leases on 13 January 1995 but had wrongly described it as 12 January; and that, accordingly, the notices were effective to determine the leases. [103] As can be appreciated it was a case of a typo error where the landlord was not in doubt of the clear intention of the tenant to renew the lease. It is more a case of failing to cross a ‘t’ or to dot an ‘i’ and surely it such cases the purposive rule serves its purpose. [104] That is no justification from departing from the long held principle that in construction contracts, “exact Compliance with time limits for notices will usually be required and will be treated as a condition precedent to a valid determination of a construction contract” as commented at para 12.038 Hudson’s Building and Engineering Contracts, Eleventh Edition 1995 Sweet & Maxwell, London. It was further held in the same paragraph as follows: 47 “... This is particularly so where continuation of a default or a state of affairs is required for a stipulated number of days before a “second” or definitive notice of determination may be served. The cases referred to in paragraphs 12-039 and 12-040 seek to underscore the strictness and seriousness of non-compliance even if the day is one day short!” [105] Our own case of Fajar Menyinsing Sdn Bhd v Angsana Sdn Bhd [1998] 6 MLJ 80 underscores the strictness with which a Court would scrutinize a Termination Notice. [106] It would also be incongruent for the Defendant purporting to terminate the Contract forthwith under common law and yet at the same time seeking to avail itself of rights available upon termination only under Contract such as the right to require the Plaintiff as Contractor to vacate the site and to return possession of the site to the Defendant and the further right of a joint inspection to determine the extent of Works executed and the materials and goods delivered to the site. [107] Having regard to the circumstances of the case it cannot be said here that the termination without Notice can nevertheless be justified under the common law right to terminate on ground that the Plaintiff as Contractor 48 had repudiated the Contract when the time frame for the continuing breach in wrongful suspension of work had not yet expired. Whether the Plaintiff has proved its Claims under paragraphs 58 of its Statement of Claim. [108] The monetary claim by the Plaintiff has been pleaded in the Statement of Claim at paragraphs 58 are as follows: Item Description Amount (RM) 1 Material on site on 20.7.2012 591,971.49 2 Panel (IBS) work done but not valued on 20.7.2012 2,370,774.00 3 IBS Mould 1,013,298.32 4 Probe 283,500.00 5 Machineries Idling for one month from June 2012 – July 2012 610,000.00 6 VO approved but not paid 39,700.00 7 Employer requested for a much bigger employer’s representative office ( not paid for additional cost) 173,702.66 8 Piling work done but not paid 1,198,704.78 9 Variation for M&E works as per instruction SP01,SP02,SP03,CW01,CW03,E02,E04,E05, E08,E09,E10, E11,E12,E13, ,E15,E16,E17,& E18. 113,029.00 49 10 Additional work done for building and infrastructure work due to Change of Design for Building Foundation and infrastructure work ( not paid) 3,957,906.36 11 Cancellation of M&E materials due to termination 7,581,171.45 12 Variation Works (Omission) 1,282,895.00 13 Revision to value of work done for M&E works. 81,000.00 TOTAL 19,297,653.06 Item 1 Material on Site Item 1 (i) Material (BRC) on site for RM208,500.00 [109] PW4 Encik Mior Azman Bin Mior Kamarudin, the Group Chief Contract Officer for the Plaintiff, admitted that there are no documents to support the BRC Claim of RM208,500.00 if one is looking for documents to support the claim of ownership. He gave evidence that the Plaintiff was only relying on the Joint Valuation Sheet at Bundle D page 707 to support this claim/CBD page 832. PW4 confirmed that he was not present during the Joint Valuation. [110] PW4 confirmed that he has knowledge that the Architect for the Project Ar. Mariyah Pit had instructed the Plaintiff to remove the materials at Site vide their letters of 6.9.2012, 19.9.2012 and 24.9.2012. He however 50 had no knowledge of the actions taken by the Plaintiff. When PW4 was referred to documents on removal of materials by subcontractors, he confirmed that these were the subcontractors of the Plaintiff. PW4 later agreed that based on the documents shown to him at pages 772-787 Bundle I, their subcontractors had removed the BRC. [111] There is also the evidence of PW4 that the Plaintiff is bound by Plaintiff’s Penultimate Claim (Progress Claim No. 16) at Bundle S page 597 in respect of the agreed deduction for BRC for RM208,500.00. Plaintiff’s Penultimate Claim agreeing to the deduction of BRC for RM208,500.00 at Bundle S at page 597 remains unchallenged/CBD page 517. [112] The Plaintiff’s Penultimate Claim agreeing to the deduction is equally reflected in the Interim Certificate No. 15 for Package 2 at pages 1126 – 1129 item 10.0, 11.0 and 12.0. The Defendant also submitted that Interim Certificate No. 15 remains unchallenged/CBD page 249. [113] On the balance of probabilities, the Plaintiff had failed to prove item 1

of RM208,400.00. Item 1 (ii) Balance M&E Materials at site for RM383,471.49 [114] DW2 Encik Mohd Azmi Bin Yahaya was the M&E Engineer at Jurutera CMP Sdn Bhd (“JCMP”). They are responsible to design the M&E 51 services for UiTM, Jasin Project. He gave evidence that he was involved in the Joint Valuation carried out from 18 - 20.7.2012 and endorsed in the Joint Valuation Report at pages 753-751 Bundle I. DW2’s evidence on the valuation carried out in respect of item 1 (ii) remains unchallenged/CBD pages 468 - 483. [115] I can accept the evidence of DW2 who testified that on 25.7.2015 JCMP went to the site and valued the balance of the M&E materials on site based on unit rates in the Contract Document. He explained that JCMP could not value the balance M&E materials in Site during the Joint Valuation on 20.7.2012 because the Plaintiff was not ready with their claims. JCMP computed the balance M&E materials on site based on unit rates amounting to RM1,144,766.60 and allowed the sum of RM894,766.82. See JCMP’s Valuation Report at page 1050 Bundle J. This sum has been duly paid by the Defendant to the Plaintiff and this was admitted by the Plaintiff at page 714 of Bundle D. [116] JCMP had rejected the Plaintiff’s claim for Item 1(ii) for the sum of RM383,471.49 on grounds that it is not a valid claim. The only witness for the Plaintiff who gave evidence on item 1 (ii) i.e. PW3 could not challenge DW2’s evaluation. 52 [117] I can accept DW2’s explanation that where the items required installation, they were allowed 70% while items not requiring installation were allowed 100%. [118] I agree with learned counsel for the Defendant that the Plaintiff has failed to proof item 1 (ii) on a balance of probabilities. Item 2 Panel IBS work done but not valued on 20.7.2012 for RM2,370,774.00 [119] PW5 Mr Lim Chee Chen gave evidence on the IBS Panel. He was the Senior Supervisor for IBS Integrated Sen Bhd, the Plaintiff’s Subcontractor during the material time. PW5 said that the Plaintiff and IBS Integrated Sdn Bhd are all under the Zikay Group of Companies. [120] PW5 explained that for the IBS Panels to be produced the shop drawings have to be prepared first and approved by the Architect. Based on the shop drawing the mould for casting would be prepared. The Plaintiff would then issue a Request Work Inspection (RWI) and all the Consultants and their representatives would have to inspect before the casting start. [121] Once completed the wall panel would be transported by lorries to the work site and the crane would be used to lift and install the wall panel. PW5 53 informed the Court that the casting yard is at the site and all the facilities are at the site. [122] The supporting documents for this claim of RM2,370,774.00 are at pages 727-813 Bundle D. I can accept this evidence of the supporting documents though it was prepared by IBS Integrated Sdn Bhd and not the Plaintiff as it is not disputed that IBS Integrated is the Plaintiff’s Subcontractor for the specialist IBS Works. The various pages detailed the breakdown of the panels installed with wet joints and those at the site but not installed yet. There were 567 Panels for the former and 445 Panels for the latter. The calculations for the various hostel blocks and floors and the quantities of Panels for each Block of hostel and the floors are all set out in details with the photos to show the panels installed and those at the site. See also pages 807-810 Bundle D. [123] The Defendant said that they do not need those precast IBS Panels. It is for them to ensure that the Plaintiff remove it lest it be said that the Defendant’s new contractor had used it. [124] If it is true that the Consultants had not approved it then there should have been letters to that effect. Likewise at the Joint Inspection conducted the Consultants must state in writing why they are rejecting the IBS Panels 54 already cast or that they are not usable because of specifications that have not been met. Not to approve it at that stage after termination and at the Joint Inspection with no reasons given would put the Plaintiff in a quandary as these panels cannot be used for other projects. The Panels were specially and specifically fabricated for this Project. [125] It is also difficult to believe, as counsel for the Defendant would want this Court to, that these panels have been destroyed. [126] I would allow this claim on a balance of probabilities. Item 3 IBS Mould for RM1,013,298.32 [127] PW5 gave evidence that IBS Mould is an accessory. At CBD page 513 under “Preliminaries” it is clearly stated that the contractor shall provide all (things) necessary for the erection of the IBS structure i.e. tools, materials, accessories, transportation, etc and a sum of RM4,187,000.00 had been set aside for that. [128] DW4 is Ir Abd Rani Bin Abd Aziz. He was Design Principal from Aresea Consulting Engineers Sdn Bhd. DW4’s evidence that IBS Mould is classified as temporary works and falls under Preliminaries hence not claimable remained unchallenged. See Bundle B 1 page 12 and 14. 55 [129] DW8, Encik Che Ayzayem Bin Che Amran, was the Project Accounts Manager of the Defendant at the material time and currently its General Manager. His evidence was that the Preliminaries in respect of IBS works has been paid by the Plaintiff to the Defendant in Interim Certificate No. 15 dated 19.11.2012 item 1.0 Bundle J page 1129 and this was not challenged. Plaintiff is therefore not entitled to claim for IBS Mould. See CBD page 247-249. [130] I would hold that the Plaintiff has not proved Item 3 on a balance of probabilities. Item 4 for Prop for RM283,500.00 [131] I agree with DW4 that Prop is a temporary system to support IBS component during installation and is included in the preliminaries allowed to the Plaintiff. (Bundle B1 pages 12 & 14 refers). IBS Mould and Prop are accessories necessary for erection of the IBS Structure. Item 4 being included in the Preliminaries is not claimable by the Plaintiff. [132] DW8’s evidence that Preliminaries in respect of IBS works has been paid by the Plaintiff to the Defendant in Interim Certificate No. 15 dated 19.11.2012 item 1.0 Bundle J page 1129 is not challenged. See also CBD page 249. 56 [133] I would hold that the Plaintiff is therefore not entitled to claim for IBS Prop. Item 5 Machineries idling for one month for RM610,000.00 [134] PW4’s evidence was that the machineries were idling for 1 month from June 2012 - July 2012 amounting to RM610,000.00 and his calculation is as set out at page 821 Bundle D. He had referred to page 640 Bundle D for a List of machineries at the site but however admitted that the List was for the period between 16.5.2012-31.5.2012. [135] PW4 said that the machineries were idling since the Plaintiff’s letter dated 18.6.2012 which was the Notice of Intention to suspend works till termination on 13.7.2012 by the Defendant. Surely the Plaintiff cannot be suspending the Works earlier then 3.7.2012 for that was what was stated in the Plaintiff’s Notice of Suspension dated 2.7.2012. PW4 agreed that neither the Defendant nor its consultants or the Defendant’s Project Management Team prevented the Plaintiff from operating its machineries. [136] This Court had earlier held such a suspension to be unlawful and hence the Plaintiff cannot claim for the idling costs of the machineries. Item 6 VO approved and not paid of RM39,700.00 57 [137] There is evidence that this VO had been approved. The Plaintiff had written to SMPM Sdn Bhd, the Project Management Company of the Defendant, by their Letter dated 3.3.2011 (pg 824 Bundle B) setting out the fact that following their instructions not to proceed with the construction of the FMS building, the Plaintiff had incurred loss and expense which could not be reimbursed by a payment made under any other provisions in the Contract. The Plaintiff therefore gave notice of their intention pursuant to Clause 24.1(a) of the Conditions of Contract to Claim for the following:

Fabricated IBS steel mould RM16,700.00 2. Design fee for the IBS Shop Drawing RM10,000.00; and 3. Management fees RM20,000.00 making a total of RM46,700.00. [138] There was a further letter from the Plaintiff dated 2.4.2011 (page 825 Bundle B) giving a breakdown of the sum claimed. [139] Then by the Plaintiff’s Letter dated 7.5.2011 (page 824 Bundle B) the Plaintiff gave a discount of RM7,000.00 thus reducing the amount claimed to RM39,700.00. The said letter also referred to a meeting held with SMPM Sdn Bhd on 3.5.2011. [140] All these letters were copied to the Defendant and it’s consultants. 58 [141] The Defendant’s stand is that they had not agreed on the quantum of the fees. Surely if that be their stand, then they should have written to the Plaintiff and not remained silent. [142] I would allow this Claim on the balance of probabilities. Item 7 VO for constructing a bigger representative office for RM173,702.00 [143] Item 7 relates to the time when employer requested for a much bigger office. I am satisfied that this is a VO consisting of omission and addition with a net addition of RM173,702.66. There must be instruction to proceed to construct a bigger site office and there was a reference to the Defendant’s Project Manager Consultant, SMPM Sdn Bhd’s instruction Ref.No. SMPM/UITMJ/TCS/MEM/01/511(636) at page 831 Bundle D. The various works done were also listed down with the price stated. A site office is big enough a structure to be noticed if it is there and there is evidence to show that after the initial instruction and quotation as to the amount involved, the Defendant did not object to it. [144] Several reminders were sent to the Defendant but there were no replies. This is a case where if the Defendant had not instructed its construction, they should have objected strenuously and stridently. The reminder letters can be found at Page 143 BOD E, page 155 BOD E, 59 pages 155 to 195 BOD E. In a further reminder at page 830 of Bundle D from the Plaintiff to SMPM Sdn. Bhd dated 6.3.2012 the Plaintiff wrote as follows: “As requested during the meeting, we are pleased to submit herewith our revised submission amounting to net addition RM173,702.66 which is included the details breakdown as per attachment, for your perusal and further action.” [145] The attachment is at page 831 with the details for each item set out in Bundle D. There was no reply to the said letter. If indeed the Defendant is objecting to the quantum, then they must descend to details and not hide behind a wall of silence. [146] I would allow the Plaintiff’s claim on the balance of probabilities. Item 8 for piling work done for RM1,198,704.78 [147] Item 8 claim is for piling work done but not paid and the claim is RM1,198,704.78. The witness testifying on this item was PW1 Abd Razak Bin Mohamed Ali, the CEO of the Plaintiff who was also the Project Director. [148] I can accept his evidence that the additional piling work is because of 60 additional loading arising from variation works instructed by the Consultant Engineer to be carried out during the progress of the work which are different from the original tender drawings. The supporting documents are found in pages 833-890 of Bundle D. [149] With respect to the instruction for the variation work, that can be found at page 923 Bundle D where by letter dated 2.11.2012 the Plaintiff had written to the Defendant as follows: “We would like to inform you that the design of building foundations including piling had changed from the original tender drawing. In our opinion the consultants should design the foundation in accordance with the IBS requirements at early stage and we are not responsible for any deviation of the design during the construction stage. At the meantime, we hereby give you notice to claim the variation order and we’ll submit the relevant cost in due course.” [150] The Plaintiff had written to SMPM on why they disagreed with the Defendant’s stand that the Plaintiff would not be paid for the additional piling. SMPM had not replied. [151] I would allow this claim on the balance of probabilities. 61 Item 9 Variation for M&E Works for RM113,029.00 [152] Item 9 is for the Variation of M&E works as per instructions. The witness testifying on this is PW3 En Hazlan Bin Hashim who was the General Manager of the Plaintiff for Mechanical & Electrical Works. [153] I am satisfied that the Defendant’s Consultant Engineer Jurutera CMP Sdn Bhd had given written instructions for the Variation Works to be done in as evidenced in pages 896-900 of Bundle D for General pipe services and in pages 906-918 for electrical services. The Engineer’s Instructions (EI) had all been complied with as can be seen at pages 901- 905 Bundle D. [154] The evidence on the amount claim is found at pages 894-895 of Bundle D. [155] The Defendant had tried to explain that this had already been valued at the Joint Valuation after termination but as explained by PW3 the Valuation was based on the original contract sum and did not take into consideration the Variation Works pursuant to the EIs. [156] I would allow this claim on the balance of probabilities. 62 Item 10 Additional work done for building and infrastructure work for RM3,957,906.36 [157] PW1 testified that Item 10 is the additional work done for building and infrastructure work due to design change for Building and Infrastructure. He referred to pages 1008-1009 Bundle D (sewerage pipe) and Pages 1011- 1013 Bundle D (for back filing material on water reticulation). [158] However there were no evidence of any instructions in writing from the Consultant Engineers EI that these changes were required or that it was the result of variations effected by the Defendant Engineers. I can accept the evidence of DW4 that changes to the layout based on the type of selection or IBS system for each building done by the Contractor’s IBS Consultant and the infrastructure works around the building arising out of such changes are matters that the Plaintiff can anticipate and as such any extra costs have to be absorbed by the Plaintiff. [159] This item is disallowed on the balance of probabilities. Item 11 Cancellation of M&E Materials for RM7,581,171.45 [160] PW3 agreed that Plaintiff is claiming for this head of claim due to subcontractors demands. PW3 also agreed that Plaintiff will not claim if the subcontractors do not claim from the Plaintiff. The relevant documents are 63 at pages 1016-1028 Bundle D. He admitted that the Plaintiff had not made any payments to these claims by their subcontractors. [161] PW3 further agreed there has not been any fresh or new demands from the subcontractors since their demands from July to November 2011. Learned counsel for the Defendant referred to Bundle I pages 908 – 911 and CBD pages 835 - 838. [162] DW2’s evidence that these subcontractors have been absorbed by the newly appointed Main Contractor i.e. Arah Semangat Sdn Bhd remains unchallenged. See also Bundle W page 1 and CBD page 839. [163] A further examination of page 1016 Bundle D prepared by the Plaintiff on the Summary or Cancellation Charges for material off-site for M&E Services would show that for items B, C, E and F, the subcontractors continued with the Main Contractor Arah Semangat Sdn Bhd (“ARH”) and that these items were used. Had these subcontractors not been paid, they would have sued for it. [164] In respect of items A, D and G these items were not delivered to site and hence not considered during the Joint Valuation. I can accept the evidence of DW2 who was the M&E Engineer from JCMP that JCMP is still the Consultant for the Mechanical and Electrical services for this Project 64 and that he personally knew that these subcontractors in respect of items B, C, E and F have been absorbed by the new Main Contractor ARH. The names of the subcontractors are Galitek Engineering Sdn Bhd, Progress Centre Engineering Sdn Bhd, Apex Air Compressor (M) Sdn Bhd and Eita Elevator (Malaysia) Sdn Bhd. DW2 further testified that Mectel Engineering Sdn Bhd is Progress Centre Engineering Sdn Bhd’s own subcontractor. [165] I am satisfied that the Plaintiff had not suffered any loss arising out of these items claimed or that otherwise these items had been absorbed by the new subcontractors ARH and the subcontractors paid accordingly. [166] This claim for cancellation of M&E Material is dismissed on the balance of probabilities. Item 12 VO (omission) for RM1,282,895.00 [167] Item 12 is for the variation works which were valued during the Joint Valuation but which the Plaintiff said were omitted by the Defendant without reason. PW4 referred to page 712 Bundle D. PW4 agreed there is no documents to support Plaintiff’s claim for item 12 and the relevant parts of the Notes of Evidence is at page 183. PW4 agreed Plaintiff is bound by Plaintiff’s Penultimate Claim in Bundle S page 597 agreeing to the deduction of RM1,282,895.00 / CBD page 517 at item 5.2. 65 [168] The Plaintiff’s Penultimate Claim (Progress Claim No. 16) agreeing to the deduction is equally reflected in the Interim Certificate No. 15 for Package 2 at pages 1126 – 1129 Bundle D items 10.0, 11.0 and 12.0. The Defendant also submitted that Interim Certificate No. 15 remained unchallenged. See CBD page 249. [169] PW2, Encik Anuar Bin Mohamed, the Plaintiff’s Director for the Project, agreed there is no supporting documents for Plaintiff’s claim at item 12. See pages 142,143 and 145 of Notes of Proceedings. [170] I agree with the Defendant that the Plaintiff had failed to proof item 12 on a balance of probabilities. Item 13 Revision to value of work done for M&E works for RM81,000.00 [171] PW3 who was the Head of Plaintiff’s M&E Department gave evidence that he was not giving evidence on item 13 and that he did not know who would be giving evidence on this item. [172] No documents have been forwarded by the Plaintiff to support item 13 and therefore no valuation was carried out by the Consultants in the Tabulation prepared by QS at Bundle I page 746 – 749. 66 [173] The Plaintiff is bound by Plaintiff’s Penultimate Claim (Progress Claim No. 16) at Bundle S page 597 in respect of the agreed deduction for Revision to value of work done for M&E works for RM81,000.00 at item 5.3 and also at CBD page 517. [174] I agree with the Defendant that the Plaintiff’s Penultimate Claim agreeing to the deduction for Revision to value of work done for M&E works for RM81,000.00 at Bundle S at page 597 remained unchallenged. [175] The Plaintiff’s Penultimate Claim agreeing to the deduction is equally reflected in the Interim Certificate No. 15 for Package 2 at pages 1126 – 1129 item 10.0, 11.0 and 12.0. Interim Certificate No. 15 remained unchallenged by the Plaintiff too. See also CBD page 249. [176] In the light of the above I would hold that the Plaintiff had not proved Item 13 on the balance of probabilities. Whether the Plaintiff has proved its Claim under paragraphs 59a to 59e of its Statement of Claim Para 59a – Interest on late payment for RM1,253,599.21 [177] Plaintiff relied on its computation at page 9 Bundle E to support this head of claim for interest on late payment of interim certificate amounting to 67 RM1,253,599.21. PW2 agreed during cross-examination that the computation at page 9 Bundle E/CBD page 553 is based on PAM Conditions of Contract in failing to certify and honour the interim certificates within 51 days pursuant to Clause 30.1. [178] However, as I had already held that where there is a conflict in the period of certification and the period of payment after the issuance of the Certificate of Payment, the terms in the Additional Provisions to the Conditions of Contract would prevail. As stated under Clause 68.3 of the “Additional Provisions to the Conditions of Contract” the Employer is to certify the amount to be paid to the Contractor within 30 days of submission of the Contractor’s monthly statement. That Certificate of Payment is to be endorsed by the Independent Checking Engineer (“ICE”) appointed and only after the said endorsement is payment due within 20 days. There is no time frame within which the ICE shall give its endorsement. Parties did not appear to be concerned enough to have addressed that in the said Clause presumably they expect each other to act reasonably throughout the Contract. Under Clause 72.1(a) of the “Additional Provisions to the Conditions of Contract” it is only after the Employer has failed to pay the Contractor within 3 months of the due date that the Contractor may give another 14 days written Notice to the Employer to remedy the breach 68 before the Contractor has the right to terminate the Contract for non-payment of a Payment Certificate duly endorsed by the ICE. Under Clause 68.13 it is only after the Employer has failed to make payments within 45 days from the due date of payment (which is 20 days from the date the Payment Certificate is endorsed by the ICE) that the Contractor may charge interest at the rate equivalent to 1.5% above the Base Lending Rate of Maybank. [179] It has not been shown by the Plaintiff that the rate of interest charged had been following the time frame for due date of payment of the Payment Certificates and the time frame prescribed for expiry before interest at the agreed rate is chargeable. [180] In any event the Plaintiff’s claim under para 59 a is inconsistent with the Deed of Settlement dated 9.11.2012 in Bundle F pages 1 – 10 / CBD pages 667 - 676. Part C in the Deed of Settlement at page 7 expressly provides as follows: “In the event parties fail to arrive at a settlement in respect of Part C, then YBKU and KSSB are given liberty to pursue their respective claims confined only to Part C and it is further expressly agreed that YBKU and KSSB shall not invoke, add and/or substitute any 69 other claim or claims whatsoever nor attempt to enforce or execute the said claims in Part C against either party without a proper deliberation by the Court and/or Arbitrator”. (emphasis added) [181] The Plaintiff in the Deed of Settlement in Part C KSSB’s Claim item 1 has claimed for interest on late payment for the sum of RM584,517.03. PW2 refused to agree that Plaintiff’s claim at Para 58 (a) is an addition not allowed under the Deed of Settlement in Bundle F at Part C. [182] During cross-examination PW2 was questioned whether the Plaintiff’s claim at Part C in the Deed of Settlement for interest on late payment amounting to RM584,517.03 is included in Plaintiff’s claim today for RM1,253,599.21 and PW2 agreed that it is included. When PW2 was asked to verify and compute at the Tabulation at page 9 Bundle E on how to arrive at the figure of RM584,517.03, PW2 could not show proof to the Court on the computation. [183] Plaintiff under this head of claim also claimed for interest on late release of retention monies by the Defendant amounting to RM448,742.00. The Defendant submitted that Retention monies under the PAM Conditions of Contract are only released under Clause 30.6(c) and (d) as follows:

the 1st moiety of 2.5% is released upon issuance of CPC; 70

(ii) the 2nd moiety of 2.5% is released upon issuance of Certificate of Making Good Defect (CMGD). [184] I agree with the Defendant that notwithstanding the above provision, both the Plaintiff and the Defendant entered into a Deed of Settlement dated 9.11.2012 and the Retention monies were agreed to be released together with the monies owing to the Plaintiff in Part A. The Deed of Settlement does not provide for any interest on late or delay in the release of the Retention Monies under Part A. Therefore, the Plaintiff now cannot revert to the PAM Contract to claim for interest on late release of Retention monies. The Plaintiff under this head of claim also claimed for interest on late payment in respect of Interim Certificate No. 15 for Package 1 & 2 certified on 21.11.2012 after the Deed of Settlement dated 9.11.2012 was entered by parties. (Interim Certificate No. 15 is at pages 1112 – 1129 Bundle J) /CBD pages 242 - 249. [185] I agree with the Defendant’s submission that the Plaintiff having agreed at Part A in the Deed of Settlement to the sum of RM24,053,364.55 ought not to be allowed to claim for late payment interest in respect of Interim Certificate No. 15 which was certified on 21.11.2012 after parties had agreed to the final sum payable to the Plaintiff for actual work valued at 71 35.08% which includes all interim certificates from Interim Certificate 1 to 15 including the retention monies. [186] DW9 gave evidence that the agreed sum of RM24,053,364.55 was paid to the Plaintiff via 3 cheques on 15.10.2012, 15.1.2013 and 23.5.2013 respectively. (DW9-WS Q&A 13 refers). [187] The Plaintiff were still computing the interest for late payment in respect of Interim Certificate No. 15 from date of certification on 21.11.2012 to 15.1.2013 less 51 days allowed under the PAM Contract for the sum of RM376,710.32 at item 29 and 30 at page 9 Bundle E. If they had calculated according to the “Additional Provisions to the Conditions of Contract” there would be no interest until the expiry of 20 days and followed by 45 days after the date of the Payment Certificate and so no interest would be payable as the time frame had not expired. [188] Similarly, the Plaintiff also claimed for interest on late payment in respect of Interim Certificate No. 14 for Package 1 & 2 at item 27 and 28 Bundle E page 9. The Plaintiff at page 9 claimed for interest from date of certification of Interim Progress Claim No. 14 on 29.6.2012 to 30.11.2012 for the sum of RM220,637.24. (The Interim Certificate No. 14 for Package 1 & 2 is at pages 1067 – 1121 Bundle J) / CBD page 250 - 304. I agree with 72 the Defendant’s submission that Interim Certificate No. 14 for Package 1 & 2 was withheld due to the Plaintiff’s default in not complying with the AI’s and the Plaintiff ought not to be allowed to reap a benefit from their own default. [189] At any rate the Plaintiff’s claim for interest on late payment in respect of Interim Certificate No. 14 & 15 ought not to be allowed on the ground that when the Plaintiff agreed to the sum of RM24,053,364.55 in Part A of the Deed of Settlement in Bundle F, there was no agreement to pay interest on late payment in the release of the said sum at Part A. Therefore the Plaintiff’s claim under para 59a for Interest on amounts outstanding for the sum of RM1,253,599.21 cannot be supported and substantiated contractually and so is dismissed. Para 59b Loss of Profit due to unlawful termination of RM20,507,546.34 [190] Generally a Contractor is entitled to claim for loss of profit arising out of a wrongful termination by the Employer. However like all claims of this nature the Plaintiff would have to be put to strict proof of this head of damages. [191] The Plaintiff referred to the case of O Stable Panel Sdn Bhd v Kenmark Industrial Co. Sdn Bhd (2010) 8 MLJ 686. It was held in that 73 case that in the event the plaintiff suffered damages due to illegal termination, the factors to be considered would be taking into consideration all costs and expenses with the total value of the contract. It is based on the principle that had it not been due to the Defendant’s unlawful termination, the Plaintiff would have been allowed to complete the balance of the works and to ultimately receive the balance of the contract value. The Plaintiff argued that it is entitled to 15% of the balance total Contract Sum amounting to RM20,507,546.34 being its loss of profit. [192] The Defendant on the other hand relied on the ratio in Popular Industries Limited v Eastern Garment Manufacturing Sdn Bhd [1989] 3 MLJ 360 at page 367 as follows: “It is axiomatic that a Plaintiff seeking substantial damages has the burden of proving both the fact and the amount of damages before he can recover. ...” [193] Further at page 369: “In this context, I am reminded of Lord Goddard’s dictum in Bonham-Carter v Hyde Park Hotel quoted with approval by Thomson CJ in Lee Sau Kong v Leow Cheng Chiang, namely, that: 74 Plaintiffs must understand that if they bring actions for damages it is for them to prove their damage; it is not enough to write down the particulars, and so to speak, throw them at the head of the Court, saying, 'This is what I have lost, I ask you to give me these damages'. They have to prove it.” [194] PW1, the Plaintiff’s Project Director, agreed that the Plaintiff’s claim is based on gross profit. He further agreed that the Plaintiff’s claim for loss of gross profit is an estimation. PW2 maintained that the loss of gross profit is computed at 15% of the balance work to be completed. Therefore, based on the Contract Sum of RM210,593,000.00 less completed works as contended by the Plaintiff of RM73,876,024.00, the balance Works is RM136,716,976.00 and 15% of that is RM20,507,546.40. PW2 agreed there is no document to support the costs to be incurred by the Plaintiff to complete the balance work. PW2 agreed no Project Accounts have been shown or produced at the trial to substantiate this claim of loss of profit. [195] During cross-examination, PW2 was referred to the SSM search result on the Plaintiff at Bundle F page 89 – 99 / CBD pages 699 - 709. PW2 agreed the gross profit before tax at page 99 in respect of a revenue of RM28,050,152.00 is only RM561,901.00 which is about 2%. PW2 also 75 agreed that the revenue of RM28,050,152.00 includes the revenue from the UiTM Jasin Project but could not tell what percentage of it. [196] I agree with the Defendant’s submission that PW2 could not rebut the documentary evidence of 2% gross profit reflected in the SSM search nor prove the alleged 15% gross profit as claimed. Learned counsel for the Defendant also highlighted that the Plaintiff had pleaded the claim for loss of profit for unlawful termination under Para 59b and under Para 60b in the Statement of Claim for “Gantirugi spesifik berjumlah RM52,157,206.64 seperti yang dinyatakan di atas” which is a Claim falling under the category of special damages requiring specific proof of the damages claimed. [197] In Kokomewah Sdn Bhd v Desa Hatchery Sdn Bhd [1995] 1 MLJ 214 at page 236 it was observed as follows: “Thus the plaintiff has not introduced any evidence to prove the amount of damages and the figures stated by the plaintiff in Schs I and II have not been substantiated. Applying the principles enunciated in Guan Soon Ting Mining Co v Wong Fook Kum [1969] 1 MLJ 99, the plaintiff, if it succeeds in the present action would, to my mind, only be entitled to an award of nominal damages.” 76 [198] I agreed with the Defendant that the Plaintiff’s claim for gross profit based on an estimation of 15% without any documentary proof via Project Accounts ought to fail in limine. [199] One must also look realistically at the Plaintiff’s stage of Completion as at the date of termination of the Contract. I can accept the evidence of DW7 Encik Wazir Bin Mansor who was the Project Manager of the Project and the Project Director from the Project Management Consultant engaged by the Defendant to manage the Project, that at the date of Joint Valuation on 20.7.2012 where parties concerned had endorsed the summary on Progress of Work at page 17 Bundle F that the actual physical work completed was only 41.03%. However at that time about 69% of the contract period of 30 months had expired. Site possession was given on 19.1.2011 and the Plaintiff was terminated on 13.7.2012. The Defendant had paid a total sum of RM74,889,919.98 representing 35.08% of the work done. With merely 12 months left for completion and the remaining works comprising 64.92% had yet to be completed, the inevitable conclusion is that is that the Plaintiff’s work was in critical delay. [200] By no means is anyone saying that the Plaintiff cannot accelerate the work but acceleration comes with additional costs of manpower and labour and without the Project Management Account being produced under the 77 circumstance of critical delay by the Plaintiff one would have to cost in the factor of a possible LAD Claim by the Defendant which would in all probability eat into if not completely decimate whatever claim to profit that the Plaintiff is now claiming. [201] All said the Plaintiff’s Claim for damages for loss of profit leaves much to be desired and is totally unsatisfactory and this Court would in the circumstance grant only a nominal damages of RM5,000.00 having regard to the Contract Sum and the balance value of work to be done and the remaining time needed for completion and the past profit record of the Plaintiff. Para 59c being Pre and Post Contract Expenses of RM5,270,000.00 [202] The Plaintiff justified this claim on the ground that the said sum had been disbursed to the Defendant as loans and advances. The only witness testifying on this claim is En Ismanazir Bin Ismail PW6, the Plaintiff’s Group Accountant. PW6 referred to pages 20-43 of BOD E to reveal all payments made to the Defendant. [203] PW6 informed the court that all the money were paid to the Defendant eventhough the recipient was in most cases Datin Hartini i.e. one of the Defendant’s directors. 78 [204] I agree with the Defendant’s submission that the Plaintiff’s claim at Para 59c is inconsistent with and not permitted under the agreed terms at Part C of the Deed of Settlement in Bundle F pages 1 – 10 in particular at page 7 wherein it is expressly agreed that both Plaintiff and Defendant are confined to their claims at Part C and parties cannot invoke, add and/or substitute any other claims. As such, the Plaintiff’s claim at para 59c is an additional claim not expressly provided at Part C of the Deed of Settlement and hence cannot be allowed. [205] Parties must be deemed to have been aware that there were other heads of claims that could possibly be raised but that for the purposes of settlement they had expressly agreed to forgo and forbear. The Plaintiff cannot now resurrect it. [206] PW6 under cross-examination agreed that it was a mistake to include the payment for RM600,000.00 paid to the Plaintiff’s Director in the Claim against the Defendant. (Page 34 Bundle E refers). PW6 agreed item 16 and 17 in the Summary at page 19 amounting to RM250,000.00 is a donation for charity dinner but agreed he included it in the claim against the Defendant because he was instructed by Dato’ Khay Ibrahim, one of the Plaintiff’s Directors. (Page 34 Bundle E refers). 79 [207] PW6 further agreed that he was a puppet at times and merely follow instructions and cannot verify the claims. PW6 agreed the payment of RM100,000.00 is for purchase of shares but did not know what shares it was though the Payment Voucher states Just Wisdom Sdn Bhd being purchaser of the shares. (Page 38 Bundle E refers). [208] PW6 could not render any answer why the heading in the Summary at page 19 Bundle E refers to “Detail of Advances for Purchase of Shares”. PW6 could not sustain and support his evidence that all the advances at page 19 in the Summary were for “Pendahuluan for UiTM Jasin Projek” or as “Advances for UiTM Jasin Project.” [209] I agree with the Defendant’s submission that the Plaintiff had failed to prove on a balance of probabilities via PW6 – the Plaintiff’s Group Accountant that all the loans and advances pleaded at para 59c for RM5,270,000.00 are advances for “Pendahuluan for UiTM Jasin Projek”. The key witness PW 6 for this claim is unconvincing having reluctantly recoiled from the reality of being relegated to a puppet at times and he cannot verify the alleged claims nor its purpose. Para 59d – Damages to business reputation for RM5,000,000.00 80 [210] This claim is as frivolous as it is fanciful. Where parties have regulated their losses by contract and in this case a Construction Contract following the PAM 2006 Contract augmented by the Parties’ Additional Provisions to the Conditions of Contract, there is no room nor basis for this claim. [211] As far back as the Federal Court case of Fung Keong Rubber Manufacturing (M) Sdn Bhd v Lee Eng Kiat & Ors [1981] 1 MLJ 238 at page 239 it has been held that an aggrieved party cannot sue for loss of reputation in a breach of contract as follows: “In the case of a claim for wrongful dismissal, a workman may bring an action for damages at common law. This is the usual remedy for breach of contract e.g., a summary dismissal where the workman has not committed misconduct. The rewards, however, are rather meagre because in practice the damages are limited to the pay which would have been earned by the workman had the proper period of notice been given. He may even get less than the wages for the period of notice if it can be proved that he could obtain similar job immediately or during the notice period with some other employer. He cannot sue for wounded feelings or loss of reputation caused by a summary dismissal, where for instance he was dismissed on a groundless 81 charge of dishonesty. At common law it is not possible for a wrongfully dismissed workman to obtain an order for reinstatement because the common law knew only one remedy, viz., an award of damages.” (emphasis added) [212] This is after all not a claim for defamation. See also the case Platinum Nanochem Sdn Bhd v Mecpro Heavy Engineering Ltd [2016] 11 MLJ 141 where the same comment had been made. [213] The Court is satisfied in any event that there has been no loss of reputation suffered as there were already demand notices issued by subcontractors against the Plaintiff and in one case a subcontractor Jeks Engineering obtained Judgment and commenced winding-up proceedings against the Plaintiff. The Plaintiff had not denied this. [214] Suffice to say that on the facts no loss of reputation had been proved. Para 59e – Legal costs in resisting unlawful and illegal termination by way of injunction and police report for RM150,000.00 [215] PW2 gave evidence that the Plaintiff’s claim at Para 59e for legal costs amounting to RM150,000.00 is supported by the documents in Bundle D pages 676 – 699. 82 [216] PW2 agreed all the invoices referred to support the Plaintiff’s claim for legal costs are not directed to the Defendant nor in respect of Court actions against the Defendant. [217] PW2 agreed the total invoices do not sum up to RM150,000.00 from pages 676 – 699 Bundle D. [218] PW2 agreed there is no documents to support legal costs of RM150,000.00 incurred by the Plaintiff against the Defendant specifically. [219] PW2 refused to agree that Plaintiff is not entitled to legal costs since the Court awarded costs to the Defendant for successfully setting aside Plaintiff’s ex-parte injunction. (Bundle F Deed of Settlement Recital 1.2 refers). [220] Under Part A Clause 4 of the Settlement Agreement it is provide that “Upon signing this Deed of Settlement , KSSB to instruct their solicitors to withdraw the Writ Action under Suit No: 22NCvC-964-08/2012 and the Injunction Order dated 17.8.2012 and both parties to bear their own costs...” [221] There is thus no basis for this claim and hence this head of claim by the Plaintiff is dismissed. 83 Whether the Plaintiff is entitled to a claim for general damages [222] The Defendant submitted that the Plaintiff in this trial had not led any evidence to support a claim for general damages under paragraph 60a of the Statement of Claim. It is to be noted that Plaintiff at Para 60b of the Statement of Claim had pleaded the Plaintiff’s entire claim at Para 58 and Para 59 as “spesifik” damages amounting to RM52,157,206.64 when what was intended to be conveyed was “Special Damages”. [223] In any event the award of nominal damages of RM5,000.00 is a category of General Damages. [224] The Plaintiff’s prayer for another head of Claim under General Damages at Para 60a is dismissed. Summary of Claims allowed for the Plaintiff [225] Based on the claims allowed for the Plaintiff, I granted judgment for the sum of RM3,900,910.44 made up of the following: Para 58 item 2 for RM2,370,774.00 Para 58 item 6 for RM39,700.00 Para 58 item 7 for RM173,702.66 Para 58 item 8 for RM1,198.704.78 84 Para 58 item 9 for RM113,029.00 Para 59 item b for RM5,000.00 [226] I also granted Interest on the sum RM3,900,910.44 at 5% per annum from date of writ to realization. Whether the Defendant is entitled under Shareholders Agreement and Sale and Purchase of Shares Agreement to an order that Just Wisdom Sdn Bhd transfer its 10% Shares in Serendah Heights Sdn Bhd for an agreed consideration back to the Defendant. [227] The Shareholders Agreement is found at pages 37-68 BOD F and the Sale and Purchase of Shares Agreement at pages 69-84 BOD F/CBD pages 752 - 766. [228] It must be stated at the outset that Just Wisdom Sdn Bhd is not a party to this suit and this Court would be loathed to make an order involving a non-party. The prayer at paragraph 39(d) of the Defendant’s Counterclaim is akin to a specific performance order. [229] As was highlighted by his Lordship Mahadev Shankar JCA in the Court of Appeal case of Arah Cipta Sdn Bhd & Anor v Kian Kee Sawmills (M) Sdn Bhd & Ors [1997] 2 MLJ 513 at page 520-521, for a plaintiff to succeed in specific performance, all parties claiming an interest 85 in the land must be made a party before the Court so that they may be made bound by the order to ensure that the purchaser could get a clear title: “... This claim was for specific performance of the contract for the transfer of the land to the purchaser. The bank had to be brought in because it was a chargee who had to be paid off and its consent was required for the sale. The other defendants were all involved in the steps taken by Datin Chong to resile from the sale agreement and to create an adverse claim to the land which they had sought to protect by filing caveats against it. If the plaintiffs were to succeed to obtain specific performance, these people had to be made bound by the order so that the purchaser could get a clear title. Besides, as against all of them, there was also a claim for damages for unlawful interference." [230] Likewise an order for specific performance may not be granted if in so ordering, the rights of third parties not before the Court would be prejudiced. The Singapore case of Coastland Properties Pte Ltd v Lin Geok Choo [2001] 1 SLR 72 is illustrative of this principle, as follows: 86 "2 ...I should add that since specific performance is a discretionary order, it is implicit that the court must feel comfortable in making the order. This simply means that that must be no residual doubt in the judge's mind that the order, if made, would not create any problems to any party, and not just to the litigants themselves. I pause to emphasize that the burden of proof is on the party claiming the order for specific performance. If he is unable to so satisfy the court he will not get the order. 3 In this case, I declined to grant an order for specific performance partly because I was not satisfied that to do so would be right and fair to all parties, including the mortgagee. The clinical approach of the common law may readily ignore the consequences to a person who is not a party to the proceedings, but the defendant is here crying for the hand of equity to intervene; and equity looks beyond the common law..." (emphasis added) [231] Furthermore only parties to a contract may sue each other under the basic principle of privity of Contract. The Sale and Purchase of Shares Agreement dated 30.4.2010 is between Yayasan Basmi Kemiskinan and Just Wisdom Sdn Bhd wherein the former sold 10% i.e. 500,000 of 87 Serendah Heights Sdn Bhd shares to the latter for a purchase price of RM4,620,000.00. [232] It does not matter that Just Wisdom Sdn Bhd paid the sum of RM4,350,000.00 via the Zikay Group of Companies including the Plaintiff and the balance sum of RM270,000.00 is still due and owing with interest accruing at 8% per annum pursuant to Clause 4.3 in the Sale and Purchase Agreement dated 30.4.2010. It was further said that as at 14.4.2017 there is an interest of RM142,347.38 and balance principle sum of RM270,000.00 due and owing in respect of the said shares. [233] Any claim for the balance purchase price of the Shares not paid to be set-off against a price to be negotiated between the parties for the transfer back has to be in a suit where Just Wisdom Sdn Bhd and Yayasan Basmi Kemiskinan are parties. [234] As the price is to be negotiated, then a key term of the contract if there is one, has not been agreed and this Court cannot decide a price for the parties short of the parties agreeing on the price. [235] At the appropriate time the relevant parties might want to wind up the company Serendah Heights Sdn Bhd whether it be on the just and equitable ground or on the ground of oppression of minority interest if there 88 is evidence to support that and if indeed they could not agree on the price. At that stage the Court would have the discretion to order one party to purchase the other party’s shares at a price the Court may determine after hearing the parties. [236] It was argued by the Defendant’s solicitors that the Plaintiff had made direct payments for the purchase of the said Shares to Yayasan Basmi Kemiskinan (YBK), Permodalan YBK Sdn Bhd (PYBK) and PYBK Usahasama Sdn Bhd (PYBKU) totaling a sum of RM4,350,000.00. [237] The relevant documents are at page 1 of Bundle V and cross reference in respect of the Payment Vouchers can be seen in the Summary at Bundle E page 19) / CBD page 559. [238] Again who made the payment on behalf of Just Wisdom Sdn Bhd is not important because even a wholly-owned entity is a separate legal entity from its parent company. [239] In the Court of Appeal case of Tenaga Nasional Bhd v Irham Niaga Sdn Bhd & Anor [2015] MLJU 2165, the Court of Appeal followed the principles laid down in Adams and others v Cape Industries Plc and another [1991] 1 All ER 929.The Court of Appeal, after examining the authorities, held that: 89 1. the corporate veil could be lifted in exceptional circumstances; and 2. those exceptional circumstances must involve: (a) actual or equitable fraud and (b) the use of the company whose corporate veil was to be lifted as the means to conceal the true facts behind the facade of the company." [240] Even in a case of tortious liability in Adams and others v Cape Industries Plc and another [1991] 1 All ER 929, the English Court of Appeal had ruled against the concept of linking a single economic unit to liability of the parent company for the debt of its subsidiaries. Lord Slade LJ said at page 1016 as follows: "The 'single economic unit' argument There is no general principle that all companies in a group of companies are to be regarded as one. On the contrary, the fundamental principle is that 'each company in a group of companies (a relatively modern concept) is a separate legal entity possessed of separate legal rights and liabilities'. ..." [241] Further at pages 1019-1020 it was clarified as follows: 90 "Mr Morison described the theme of all these cases as being that where legal technicalities would produce injustice in cases involving members of a group of companies, such technicalities should not be allowed to prevail. We do not think that the cases relied on go nearly so far as this. As Sir Godfray Le Quesne submitted, save in cases which turn on the wording of particular statutes or contracts, the court is not free to disregard the principle of Salomon v A Salomon & Co Ltd [1897] AC 22, [1895–9] All ER Rep 33 merely because it considers that justice so requires. Our law, for better or worse, recognises the creation of subsidiary companies, which though in one sense the creatures of their parent companies, will nevertheless under the general law fall to be treated as separate legal entities with all the rights and liabilities which would normally attach to separate legal entities.” (emphasis added) [242] In the present case there is not a trace of any of the exceptional circumstances referred to above, much less a plea for the corporate veil to be lifted. [243] Learned counsel for the Defendant then argued that being a 10% Shareholder in Serendah Heights Sdn Bhd, Just Wisdom Sdn Bhd has 91 given the following undertaking in the Shareholders Agreement dated 5.7.2010 / CBD pages 722 - 751 and referred to the following Clauses: “Clause 5.2 – JWSB hereby agrees and covenants as follows:

5.2.4 to ensure that its nominated contractor ie KSSB who will undertake the construction, completion and timely delivery of the Project will comply and adhere to all terms and conditions as imposed by the Government of Malaysia in the concession agreement.

JWSB hereby agrees and covenants to cause KEMBANG SERANTAU SDN BHD (Company No. 224505-W) to undertake to indemnify and keep indemnified and hold harmless YBK, PEHSB and the Concession Company from and against all losses, liabilities, obligations, damages, judgments, deficiencies, claims, demands, suits, proceedings, arbitration, assessments, costs and expenses (including without limitation, expenses of investigation and enforcement of this indemnity and reasonable solicitors’ fees and expenses) suffered, incurred or sustained by YBK, PEHSB 92 and the Concession Company, directly or indirectly, as a result of or arising out of a breach or breaches of any warranties, undertakings and obligations of KEMBANG SERANTAU SDN BHD (Company No. 224505-W) under the agreement for the appointment of KEMBANG SERANTAU SDN BHD (Company No. 224505-W) as the main contractor. Clause 14.1 – Representations and Warranties by JWSB JWSB hereby warrants, covenants and represents to YBK that:

it has the relevant expertise in the fields of constructing and developing institutes of higher education and related businesses and it has the technical know-how, expertise and knowledgeable and experienced personnel to manage the performance of its nominated Main Contractor and operate the Project; ...

it is financially solvent, able to pay its debts as the mature, and possessed of sufficient working capital to complete its obligations under this Agreement; 93 Clause 14.2 – JWSB acknowledges that YBK and PEHSB has entered into this Agreement in reliance on its representations and warranties as aforesaid. Clause 14.5 – Without restricting the rights of YBK and PEHSB or the ability of YBK and PEHSB to claim damages on any basis available to it, if JWSB is in breach of any of the warranties set out in Clause 14.1, JWSB shall pay to YBK and PEHSB on demand the amount necessary to put YBK and PEHSB into the position which would have existed if the said warranties had not been breached together with all costs and expenses incurred by YBK and PEHSB as a result of such breach.”(emphasis added) [244] Having addressed the obligations and liabilities of JWSB, learned counsel for the Defendant drew the Court’s attention to Clause 15.2 in the Shareholders Agreement which further identifies what constitutes an Event of Default by a Shareholder. Clause 15.2 expressly states the following defaults by a Shareholder as an “Event of Default”: “Clause 15.2 94 ...

fails to carry out the Project diligently and or stalls or abandons the Company; or

commits a material breach of any of its obligations under this

fails to undertake or perform any part of its obligations in accordance with the terms and conditions of this Agreement;” (emphasis added) [245] Learned counsel then argued that clearly the termination of the Plaintiff and the delay in the works is explicit of JWSB’s default and inevitably the breach of its undertakings and covenants under the Shareholders Agreement. [246] The Defendant further submitted that Just Wisdom is in breach of Clause 5.2 in the Shareholders Agreement dated 5.7.2010 in failing to ensure its nominated contractor i.e. the Plaintiff undertakes the construction, completion and timely delivery of the UiTM, Jasin Project. It was argued that this breach is an Event of Default pursuant to Clause 15.2 in the said Shareholders Agreement and the Defendant being a wholly owned subsidiary of Serendah Heights Sdn Bhd is entitled to the remedy 95 provided pursuant to Clause 15.3 (a) (i) to require the transfer of the 500,000 Serendah Heights Shares from the defaulting shareholder ie Just Wisdom Sdn Bhd via its agent/nominee ie the Plaintiff at a fair market value determined and certified by the Auditors which shall be final and binding on the shareholders. [247] There was the further argument that the Non-Defaulting Shareholders YBK and PEHSB have a right to be indemnified by JWSB for the losses incurred arising from the Event of Default and in connection with the enforcement, preservation or protection of any rights against the Defaulting Shareholder under the Agreement. This indirectly would involve the Defendant’s claims against the Plaintiff in this trial. It was further submitted that the Defendant being the Concession Company and the wholly owned subsidiary of Serendah Heights Sdn Bhd has locus standi to claim for the return of the said shares. [248] My simple answer to that is that if Just Wisdom Sdn Bhd had breached its Undertaking, then it is for the relevant contracting party to sue Just Wisdom Sdn Bhd and not for parent companies to fight the battles of its subsidiaries in complete disregard and defiance of the rule of separate legal entities since the watershed case of the House of Lords' decision in 96 Saloman v Saloman & Co Ltd [1897] AC 2 and bypassing the principle of privity of contract. [249] This Counterclaim of the Defendant at paragraph 39(d) of its Counterclaim would have to be dismissed. Whether the Defendant has proved its LAD under Para 39 (e) and (f) of the Counter Claim Para 39(e) of the Counterclaim for LAD before termination [250] The Defendant’s claim for LAD at Para 39(e) in the Counterclaim is as follows: “Para 39 (e) - LAD for the 8% delay amounting to RM9,705,894.24. This is pursuant to the Project Account being finalized and the figures revisited. The Defendant’s Counter Claim for LAD is now for a reduced sum of RM9,705,894.24 is supported by the Architect’s Instruction (AI) No. 17 dated 2.7.2012 at pages 932 – 934 in Bundle I. AI No. 17 confirms the delay of 8% in the Plaintiff’s work. The summary for the computation of the LAD is at page 114 in Bundle G / CBD 97 page 848. The supporting documents are attached at Appendix 1 from pages 124 – 214 in Bundle G. Further, the LAD per day is fixed at RM163,509.00 in the PAM Conditions of Contract 2006 (Without Quantities) in Bundle B at page 80 / CBD page 95. A summary of the computation is at page 115 in Bundle G/CBD page 849 and the supporting documents are at Appendix 2 from pages 215 – 223 in Bundle G and from pages 948 – 1030 in Bundle I.” [251] Learned counsel for the Defendant admitted that both the Clauses on LAD in the PAM Contract at Clause 22 and Clause 51 in the Additional Provisions to the Conditions of Contract provide for LAD due to non-completion of the works by the Completion Date. This provision for LAD requires the Certificate of Non-Completion (CNC) to be issued by the Architect to trigger the claim for LAD from the period of due completion to the actual period of CPC. [252] As no CNC had been issued the Defendant is not entitled to a Claim for LAD. Moreover as this Court had held that the termination of the Contract was unlawful, the Defendant cannot now Claim for LAD. 98 [253] However the Defendant sought to justify its claim for LAD for delay that could be ascertained even before the CPC and CNC. It was submitted that there are 2 most important stakeholders who are the Government through the Ministry of Higher Education where UiTM is the end user and the Financier i.e. BPMB. It was said that these 2 stakeholders have their own set of requirements and conditions (apart from the PAM Contract) that the Defendant and the Plaintiff have to abide in order for them to be involved in the Project. The set of requirements by these 2 stakeholders are expressed in the Additional Provisions to the Conditions of Contract and also in the Addendum to both the Letters of Award for Package 1 & 2. [254] In both the Letters of Award for Package 1 & 2 at Clause 13 it is provided as follows: “Clause 13 Approval of Appointment by Financier 13.1 You acknowledge that we are required to meet all requirements and conditions imposed by the financier failing which we shall not be given any financing for the Project hence rendering us to be unable to fulfill the conditions precedent in the Concession Agreement. Thus, notwithstanding Item I or any other provision in this letter, you also 99 agree that this appointment is further subject to the approval of our financier for the Project as regards the same”. [255] Pursuant to Clause 13 above, the Defendant therefore submitted that the Financier for the Project had requested that LAD be imposed following any event of delay on the Plaintiff’s part and this additional provision at Clause 4.1 was incorporated in the Addendum to the Letter of Award dated 9.12.2010 for Package 1 & 2 at Bundle B pages 23 – 26 and Bundle B2 pages 14 – 18. [256] Clause 4.1 reads: “Notwithstanding Item 10.6 of the LOA, the Financier for the Project had requested that we further impose liquidated and ascertained damages (“LAD”) following any event of delay on your part. Thus, in accordance with Item 11.2 of the LOA, where it was stipulated inter alia that should our financier impose any condition or requirement upon you, you shall undertake to comply with the same within such timeline as may be imposed, the provisions regarding LAD are hereby made conditions of your appointment and execution of the Project, in the manner hereinafter appearing”. (emphasis added) 100 [257] Premised on Clause 4.1 in both the Addendum to the Letters of Award, the Defendant submitted that the Defendant’s claim at Para 39 (e) and (f) for LAD is based on the event of delay caused by the Plaintiff as follows: “LAD for the 8% delay • As confirmed by the Architect in A1 No, 17 on the 8% delay in the Plaintiff’s works. (Bundle I pages 932 – 934) / CBD pages 324 - 326. • Based on the evidence of DW6 at para 7.1 in the analysis of DW6’s evidence as appended below: Even though LAD is normally paid upon issuance of CNC, Certificate Non-Completion, LAD may be payable in this case due to Clause 4.1 (Addendum to Letter of Award). The 8% delay is a conservative figure. The joint valuation yield a 35.08% of physical work done against an almost 60% contract period which have lapsed; 60 – 35 = 25% deficit. Should we remove say 10% due to the S curve, it is still 15% of delay. However, we need the work programme in Microsoft project format from the Plaintiff to ascertain the 101 actual percentage of delay. Be that as it may, it is not unreasonable to say that 8% delay is the LAD that could be imposed.” [258] There is no evidence that the Defendant’s financier had exacted this Claim from the Defendant and charged them accordingly. There is also no proof as to how this sum of 8% calculation is a genuine calculation of the loss suffered by the Defendant. There is also no evidence before the Court that the Ministry of Higher Education had charged the Defendant for this sum. [259] As was held by the Federal Court in Selva Kumar a/l Murugiah v Thiagarajah a/l Retnasamy [1995] 1 MLJ 817, under section 75 Contracts Act 1950 damages must be proved. [260] The Federal Court in Johor Coastal Development Sdn Bhd v Constrajaya Sdn Bhd [2009] 4 MLJ 445, held that Selva Kumar (supra) is still good law and the appellant/vendor could not recover or retain without proof by evidence of the loss or damage suffered as a result of the breach of the Sale and Purchase Agreement there. [261] In the circumstances this I would dismiss this Counterclaim of the Defendant for LAD under paragraph 39(e). 102 Para 39(f) of the Counterclaim for LAD during suspension and injunction period [262] The submission of the Defendant for this Claim is as follows: “Para 39 (f) - LAD for delay in the works during suspension period from 3.7.2012 to 13.7.2012 and during injunction period from 24.7.2012 to 13.8.2012 amounting to RM6,867,378.00. This is pursuant to the Project Account being finalized and the figures revisited. [263] The Defendant’s Counter Claim for LAD for the sum RM6,867,378.00 is derived during the suspension period and the injunction period as follows: - Suspension period from 3.7.2012 to 13.7.2012 - Injunction period from 24.7.2012 to 13.8.2012 (Grounds of Judgment at page 991 in Bundle I refers).” [264] The Defendant submitted that the delay in the works during the Suspension period from 3.7.2012 – 13.7.2012 and during the injunction period from 24.7.2012 to 13.8.2012 are not challenged by the Plaintiff. The Order of the Court and the documentary evidence to support the aforesaid duration were not rebutted. 103 [265] The Defendant had themselves given the Plaintiff 14 days to return to work in their Notice dated 3.7.2012 through its Architect Landesign. As this Court had held that the termination on 13.7.2012 was unlawful the Defendant is not entitled to damages for delay occasioned during this period which in any event is the period allowed for by the PAM Contract 2006 that the Architect had chosen to follow for the purpose of Notice to rectify the breach of unlawful suspension. [266] In any event this loss has not been proved under section 75 Contracts Act 1950. [267] With respect to the injunctive period, this period of 24.7.2012 to 13.8.2012 is after the termination of the Contract on 13.7.2012 and hence the Plaintiff would have no choice but to cease work and vacate the Site forthwith whether or not the termination is held subsequently to be lawful or unlawful. [268] Under such a circumstance the Defendant cannot have the cake and eat it in having the audacity to claim for LAD even after it had effected termination of the Contract and of the Plaintiff. Para 39 (g) of the Counterclaim for expenses incurred during suspension and injunctive orders for RM184,331.69 104 [269] The Defendant had computed the suspension and injunctive period as follows:

Suspension period from 3.7.2012 – 13.7.2012. (Based on Plaintiff’s Notice of Suspension dated 2.7.2012 and Defendant’s Letter of Termination dated 13.7.2012).

(ii) Injunction period from 24.7.2012 to 13.8.2012. (Supported by Recital 1.2 at page 3 in the Deed of Settlement dated 9.11.2012 in Bundle F page 1 – 10). [270] Defendant’s supporting documents are at Bundle G pages 226 – 418. [271] Learned counsel for the Defendant submitted that DW5, the QS, gave evidence that DW5 had verified Defendant’s claim and allowed the sum of RM184,331.72 as being a valid claim supported by documents. DW5’s verification is at Bundle G pages 224 – 225 / CBD pages 846 - 847. [272] DW8, the General Manager who is responsible for the Project Accounts of the Defendant, gave evidence that the Project Accounts being finalized and the figures revisited, the Defendant’s claim under Para 39 (g) is now verified by the QS (DW5) and reduced to RM184,331.72 and the supporting documents are at pages 226 – 418 Bundle G. 105 [273] The Defendant submitted that the Plaintiff failed to challenge DW5’s evidence on the verification and also failed to challenge the supporting documents from pages 226 – 418 in Bundle G. The Defendant therefore submitted that the Defendant had proved this head of claim on a balance of probabilities. [274] I do not agree. With respect to the suspension period, the Defendant had themselves given a grace period of 14 days to rectify the breach of unlawful suspension and had further terminated the Contract on 13.7.2012 before the period is up. This Court had held that such a termination is unlawful and as such it would be incongruent for the Defendant to be able to claim for damages sustained during the period of 3.7.2012 to 13.7.2012 when its own action had been found to be unlawful. [275] As for damages sustained during the period of the injunction, again it would be inconsistent with the agreement forged in the Settlement Agreement to on the one hand having agreed to the Plaintiff withdrawing the Writ action in Suit No. 22NCvC-964-08/2922 and the Injunctive Order of 17.8.2102 and even withdrawing the appeal to the Court of Appeal on the Injunctive Order, to now claim the sum of RM184,331.72. 106 [276] If it is damages arising out of the injunction, then it should be properly pursued in the same action under assessment of damages pursuant to the Undertaking given by the Plaintiff to pay such damages as may be sustained by the Defendant as a result of the injunction before it was set aside. [277] It is further incongruent to claim damages under this head when the Defendant had effectively terminated the contract on 13.7.2012. [278] Moreover the parties had no difficulties conducting a Joint Valuation from 18.7.2012-20.7.2012 and it is difficult to imagine what damage the Defendant had suffered from 24.7.2012 to 13.8.2012. [279] This claim had not been proved on the balance of probabilities and therefore is dismissed. Para 39 (j) of the Counterclaim for interest on early release of retention sum for RM7,339,307.90 [280] The Defendant’s claim arises out of the early release of the Plaintiff’s retention monies in the Deed of Settlement dated 9.11.2012 at Part A Para 1 page 4 Bundle F/CBD pages 667 - 676. 107 [281] Under the PAM Conditions of Contract retention monies are released upon issuance of CPC and the CMGD namely towards end of the Project. On our given facts, due to the early release insisted by the Plaintiff, the Defendant is now burdened with the interest for the tenure of the loan until the UiTM Jasin Project is completed. [282] DW8 who is responsible for the Project Accounts of the Defendant gave evidence that the computation for the interest can be found at Bundle J page 1183/CBD page 850. The Penultimate – Interim Certificate No. 15 for Package 1 & 2 at page 1123 & 1075/CBD pages 243 & 258 provides the retention monies amount to RM7,305,578.16 consisting of RM430,500.00 for Package 1 and RM5,641,812.40 for Package 2. The interest of 6.3% per annum is computed from date of release of the retention monies to the Plaintiff on 21.5.2013 till expiry of Defect Liability Period on 18.7.2015 amounting to RM534,648.23. [283] The Defendant further submitted that the Defendant had reserved its rights to claim for interest on the early release of the retention sum to the Plaintiff and this can be noted at Part A Para 1 at page 4 in the Deed of Settlement wherein it is expressly stated – 108 “It is hereby agreed that the sum of RM24,053,364.55 is the agreed sum payable to KSSB. It is further agreed that the payment of RM24,053,364.55 to KSSB is without prejudice to YBKU’s claim in Part B and Part C therein”. [284] Further, Defendant’s claim at Para 39 (j) is at item 2 in Part C in the Deed of Settlement at page 7 Bundle F. Therefore, the Defendant submitted that the Plaintiff claim at Para 39 (j) is supported and ought to be allowed. [285] Before the Court can allow this claim, it must be shown that the parties had agreed that interest will be charged for the relevant period for early release of the Retention Sum. Since there was no agreement that interest would be paid, this Court cannot impose or import a term which is not there and which the parties could not agree. Without an agreement on interest, the Defendant is not obliged to release the Retention Sum and then later imposed interest unilaterally. [286] At any rate as this Court had held that the termination was unlawful, the Retention Sum could not be validly held as the Plaintiff would not be allowed back into the Site to carry out rectification Works. Thus the so- 109 called early release of Retention Sum after the termination of Contract can nevertheless be justified in the circumstances of the case. Para 39 (l) of the Counterclaim for escalation of costs for RM5,600,000.00 [287] DW7 i.e. the Project Director at SMPM gave evidence on Defendant’s Counter claim at Para 39 (l) for escalation of costs amounting to RM5,600,000.00. [288] This claim cannot be allowed in law as this Court had already found the Defendant’s termination of the Contract to be unlawful. Any extra costs of completion arising out of the Defendant’s unlawful termination cannot be charged to the Plaintiff for that would be to allow the Defendant to profit from its own unlawful conduct of termination. Para 39 (n) of the Counterclaim for legal costs for RM222,242.75 [289] The Defendant’s claim for legal costs for the sum of RM222,242.75 is for damages suffered by the Defendant by way of legal expenses and costs incurred due to Plaintiff’s default in obtaining injunctive measures. This claim arises from the undertaking as to damages given by the Plaintiff in the ex-parte Order dated 24.7.2012 at pages 983 to 989 Bundle I/CBD pages 840 - 845. The ex-parte Order was later set aside as can be noted from the Grounds of Judgment of the Learned Judge at page 991 at Bundle 110 I. Hence the Defendant submitted the Defendant’s claim for legal expenses incurred as supported by the documents in Bundle G pages 454 – 456, 450 – 453, 457 – 460, 461, 473, 474, 480, 484, 481, 482 and 483 ought to be allowed/CBD pages 633 - 666. [290] The Defendant submitted that the legal fees incurred by the Defendant to set aside the injunctive measures vide the legal charges appended below are directly in respect of the UiTM, Jasin Project and against the Plaintiff. This is evident from the legal Bill of Charges as appended below: Bill No. 2598/12 - RM 5,000.00 (page 451) Bill No. 2558/12 - RM 5,000.00 (page 455) Bill No. 2693/13 - RM 1,500.00 (page 458) Bill No. 2669/13 - RM135,137.55 (page 462) Bill No. 2670/13 - RM 41,717.70 (page 462) Bill No. 2822/13 - RM 33,887.70 (page 475) --------------------- RM222,242.95 ============ [291] It is no doubt true that the Plaintiff had undertaken to bear all damages during the injunction application. However, I agree with learned 111 counsel for the Plaintiff that the damages do not cover any legal fees as claimed by the Defendant. [292] In Sunseekeers Pte Ltd v JSH Joshua [1990] 3 CLJ (Rep) 979 the court stated that legal fees is not part of claimable damages. They should be taxed as part of the party and party costs payable to the Defendant. [293] This Counterclaim of the Defendant for legal Fees is thus dismissed. Para 39 (p) of the Counterclaim for damage to reputation for RM10,000,000.00 [294] The Plaintiff after termination obtained an ex-parte interim injunction against the Defendant amongst other to restrain the Defendant and/or their agents from entering the Project Site. The ex-parte Order is at Bundle I page 991. In the said ex-parte Order the Plaintiff inserted a Penal Clause against the Directors of the Defendant. [295] The Plaintiff obtained leave and commenced committal proceedings against the Directors of the Defendant and the Directors were served with the cause papers by the Plaintiff. (Recital 1.2 Deed of Settlement Bundle F page 3 refers)/CBD pages 667 - 676. 112 [296] Further, the Plaintiff had issued a Section 218 Notice dated 5.10.2012 against the Defendant in respect of the UiTM, Jasin Project. (Para 7 Part A Deed of Settlement in Bundle F refers). [297] What I had said with respect to the Plaintiff’s claim for loss of reputation would equally apply to the Defendant’s Counterclaim for loss of its reputation. [298] Furthermore if the Defendant had wanted to sue for damages arising out of the injunction being set aside, it must then pursue it in the Writ action which unfortunately had been withdrawn together with the injunctive order and the appeal from the injunctive order. [299] This Counterclaim of the Defendant for loss of reputation cannot be sustained and is not supported by evidence and so is dismissed. Para 39 (q) Damages to be assessed and in particular for the Costs of Rectification Works for RM4,312,229.71 [300] DW5, the QS, gave evidence that the new contractors i.e. Arah Semangat Sdn Bhd appointed by the Defendant after the Plaintiff’s termination had carried out the rectification works in respect of the Plaintiff’s unacceptable works. DW5 further gave evidence that DW5 113 prepared on behalf of ARH Interim Payment Certificate No. 3 (Rectification & Variation Works) at pages 490 – 547 in Bundle H / CBD pages 605 - 632. [301] Pursuant to Interim Payment Certificate No. 3 (Rectification & Variation Works), ARH valued the same as follows:

Rectification Works : RM4,312,229.71

(ii) Variation Works : RM 973,011.60 ----------------------- Total RM5,285,241.31 ============= [302] I can accept the evidence of DW5 who confirmed that the Defendant is entitled to be reimbursed for the sum of RM4,312,229.71 paid out to Arah Semangat Sdn Bhd for Rectification Works. DW5 was candid in giving his evidence that the Defendant is not entitled to the Variation Works amounting to RM973,011.60. [303] I agree with learned counsel for the Defendant that the above evidence on rectification works was further corroborated by DW4’s evidence i.e. the Structure & Civil Consultant as follows: 1 The Defendant can claim from the Plaintiff the costs incurred by the Defendant to rectify the Plaintiff’s work amounting to RM4,312,229.71. DW4 confirmed the newly appointed Main 114 Contractor i.e. Arah Semangat Sdn Bhd carried out the Rectification Works. This rectification works is supported by Interim Payment Certificate No. 3 (Rectification Works) at Bundle J page 1130 – 1157 in particular page 1133/CBD pages 605 - 632. 2 DW4 referred to Interim Payment Certificate No. 3 (Rectification Works) which is endorsed by all the Consultants including ARSEA to support this claim because the said rectification works were duly completed to the Consultant’s satisfaction. DW4 further gave evidence that as the Principal C&S Engineer responsible for the UiTM Jasin Project he has full knowledge of this Certificate. DW4 confirmed that Ir. Mohd Halimi bin Dato’ Abdul Hamid ie the CEO of ARSEA endorsed Interim Certificate No. 3. (Bundle J page 1132 refers). [304] The above evidence by DW4 and DW5 on rectification works carried out by the newly appointed Main Contractor due to Plaintiff’s unacceptable works amounting to RM4,312,229.71 was not seriously challenged nor rebutted by the Plaintiff. 115 [305] Plaintiff’s First Written Submission has not addressed the Defendant’s claim for rectification works nor any objection raised on the same. In fact, the Plaintiff’s Written Submission in toto has not challenged the Defendant’s Counter Claim. [306] However learned counsel for the Plaintiff had in his further submission after the first clarification raised the issue that the claim for rectification Works was not specifically pleaded. [307] Learned counsel for the Defendant urged this Court to take cognizance that after the Defendant had closed its case, I had given written directions for both parties to submit and the Defendant had informed the Court that the claim for rectification works would fall within the general damages claimed at paragraph 39 (q). I am satisfied as to what transpired as can be gathered from the Notes of Evidence at Appendix – 1 (item 17 refers). Further, the Notes of Evidence on 14.4.2017 annexed as Appendix – 2 at pages 51 & 52 expressly stated the Defendant’s claim for Rectification Works will be included in Para 39 (q) under the head of General Damages. I agree that nowhere in the Notes of Proceedings, is it stated the Plaintiff’s objection to this head of claim as unpleaded. I would agree with the Defendant’s submission that at no material time did the 116 Plaintiff through its learned counsel, raise any objection to the Defendant’s claim for rectification works. [308] The Defendant further submitted that the Plaintiff had not been taken by surprise by the Defendant’s claim for rectification works. On the contrary, the Plaintiff had participated without objection and cross examined the Defendant’s Witness DW4 on this claim. Notes of Evidence on 14.2.2017 in particular at pages 51, 52, 55 and 57 marked as Appendix – 3 refers. I agree that the Plaintiff’s assertion that the rectification costs is not reflected in the Final Account has no merits for the retention monies have been released to the Plaintiff in the Deed of Settlement. The Defendant further submitted that the Defendant’s claim for rectification works is not too radical a departure from the pleadings but in fact are damages common in the building industry. [309] If authority is needed one can refer to the Supreme Court’s decision in Superintendent of Lands and Surveys (4th Div) & Anor v Hamit bin Matusin & Ors [1994] 3 MLJ 185 where the headnotes had summarized the facts as follows: “The plaintiffs applied for an injunction, inter alia, to restrain the defendants from building on certain state lands (‘the lands’), over 117 which the plaintiffs claimed to have acquired native customary rights. At the trial, one of the reasons for the defendants’ denial of the existence of such native customary rights was that the lands were situated within a river bank reserve on which no one could claim any title thereon by virtue of the Sarawak Land Code (Cap 81). Another reason was that the lands once belonged to Sarawak Shell Oil Ltd. In the final submission after the conclusion of all the evidence, an objection was raised by the Plaintiffs for the first time that such defences were not pleaded and ought to be disregarded under O18 r 7(1) of the Rules of the High Court 1980.” [310] It was held at page 190 as follows: “...Therefore when such evidence represents a departure from pleadings, it should be objected to as and when and where it is adduced, and it will be too late when it only objected to later on, as in the final submission at the close of evidence in the instant appeal. In these circumstances, the party facing such evidence at variance from the pleadings, by failing to object, cannot be said to be taken by surprise, prejudiced, misled or embarrassed. Otherwise, the other side of the coin would be, in the event of such an objection raised at the stage of final submission being accepted by 118 the court, that the party adducing such evidence may face the great risk of being denied leave to amend his pleadings in question at that stage. Such evidence, when given without any objection by the opposing party, will further have the effect of curing the absence of such plea in the relevant pleading, in other words, the effect of overcoming such defect in such pleading...” (emphasis added) [311] Learned counsel for the Defendant also referred to the case of KEP Mohamed Ali v KEP Mohamed Ismail [1981] 2 MLJ 10 at p 12, where it was said: “... As one of the objects of modern pleadings is to prevent surprise, we cannot for one moment think that the defendant was taken by surprise. To condemn a party on a ground of which no material facts have been pleaded may be as great a denial of justice as to condemn him on a ground on which his evidence has been improperly excluded.” [312] In view of the above evidence, I agree with the Defendant’s submission that the Defendant’s claim at Para 39 (q) for rectification works for RM4,312,229.71 has merits and is proved on a balance of probabilities. 119 [313] I also allowed interest on the above amount from date of judgment, as prayed under paragraph 39(r) of the Defendant’s Counterclaim, to date of realization at 5% per annum. Pronouncement [314] In a nutshell the Plaintiff succeeded in its Claim in the sum RM3,900,910.44 together with interest at 5% per annum from date of writ to realization. The Defendant succeeded in its Counterclaim in the sum of RM4,312,229.71 together with interest at 5% per annum from the date of judgment to realization. [315] Based on the circumstances of this case, this Court had exercised its discretion and made an order that each party bears its own costs. Dated: 19 January 2018. - Sgd - YA LEE SWEE SENG Judge Construction Court High Court Kuala Lumpur 120 For the Plaintiff : Ismail Arifin (Messrs Ram Reza & Muhammad) For the Defendant : Yougesswary Singam (Chambers of Yougesswary Singam) Date of decision: 24 July 2017