Mrcb Builders Sdn Bhd v Pembinaa Leeping (WA-22C-39-05/2020)

PEMBINAA LEEPING (Business Registration No.: 002420597-T)

2.

3.

FOO KEE LEANG (Trading in the name and style and as a partner in Pembinaa Leeping’s business)

LIM SOON SENG (Trading in the name and style and as a partner in Pembinaa Leeping’s business) ... DEFENDANTS GROUNDS OF JUDGMENT INTRODUCTION [1] In this suit, the Plaintiff alleged, among others, that the 2nd Defendant (‘D2’), 3rd Defendant (‘D3’), 4th Defendant (‘D4’) and 5th Defendant (‘D5’) had conspired in using the 1st Defendant (‘D1’) to submit Progress Claims for the supply of labour in the Westin Desaru Resort project in Johor which resulted in the Plaintiff certifying the same and payment in the sum of RM922,904.80 being made by the Plaintiff to D1. [2] The Plaintiff sought declaratory orders, refund of the sum of RM922,904.80 and payment of general, damages, special damages, aggravated damages and exemplary damages against the Defendants. [3] Apart from defending itself against the Plaintiff’s claim, D1 filed a counterclaim against the Plaintiff for the sum of RM2,484,232.23 as the amount due and owing for works done for the project and general damages, or alternatively, for the claims to be assessed and paid to D1 on the basis of quantum meruit. [4] After a full trial and having considered the pleadings, oral and documentary evidence and the submissions and clarifications by the learned counsels who represented the parties, I had –

dismissed the Plaintiff’s claims against the Defendants as per paragraph 53 of the 2nd Amended Statement of Claim (‘SoC’; encl. 84);

allowed part of D1’s counterclaim against the Plaintiff i.e. in the sum of RM768,379.01 inclusive of 6% Goods and Services Tax (‘GST’) with interest at the rate of 5% per annum on the sum of RM724,885.00 calculated from 16.10.2020 (date of the counterclaim) until the date of full settlement;

ordered the Plaintiff is to pay the following costs, subject to the allocator fees: D2 - RM100,000.00; D3 - RM80,000.00; D4 - RM50,000.00; D5 - RM50,000.00; and

made no order as to costs in respect of D1. [5] Naturally, the Plaintiff is dissatisfied with the entire decision except for subparagraph 4(d) above and is pursuing its right of appeal. On the other hand, D1 is aggrieved with only part of the decision where the other items of its counterclaim were not allowed by the Court and D1 is similarly seeking to reverse the decision. [6] These are my full grounds of judgment for purposes of the Plaintiff’s and D1’s appeals. AGREED FACTS [7] The facts which were agreed by the parties for the trial as set out in the Statement of Agreed Facts (encl. 184) are as follows. [8] The Plaintiff is a company incorporated under the Companies Act 2016 having its registered address at Aras 33A, Menara NU 2, No.203, Jalan Tun Sambanthan, Kuala Lumpur Sentral, 50470 Kuala Lumpur, Malaysia. Its business address is at Level 30, Menara Allianz Sentral, No. 203, Jalan Tun Sambathan, Kuala Lumpur. The Plaintiff is in the business of providing engineering and construction services and is involved in numerous constructions related projects throughout Malaysia. [9] D1 is a partnership formed under the Partnership Act 1961 having its main business address at No. 51, Lot 3651, Batu 27½, Jalan Faizal 81500, Pekan Nanas, Johor. D1 is, amongst other, a business that handles construction and renovation works. [10] D4 and D5 are Malaysian citizens having their last known residential address at No. 5-13-28, Jalan 2/124, Taman Connaught, Cheras, 56000 Kuala Lumpur and No. 223, Jalan Utama 1, Taman Utama, 81500 Pekan Nanas, Johor, respectively. At all material times, D4 and D5 are partners carrying out the business of D1. [11] D2 is similarly a Malaysian citizen and was appointed by MRCB or MRCB Engineering Sdn. Bhd. At one point in time, D2 was the Project Director for the project known as the “The Proposed Westin Desaru Resort” at Desaru, Johor Darul Takzim for Corniche Hotel Sdn Bhd” (‘Westin Project’). [12] D3 is a Malaysian citizen having his last known residential address at LC-653, Kampung Baru, 31700 Malim Nawar, Perak. Vide the letter dated 7.7.2015, D3 was appointed by MRCB as the Project Manager of Job Grade 5 and was also assigned to the Special Project (LRT, Package B-Mainline), Puchong, Selangor (‘LRT Project’). [13] D3 began employment with MRCB Engineering Sdn Bhd on 24.8.2015. D3 was transferred from the LRT Project to the Westin Project as the Project Manager vide MRCB’s letter dated 30.6.2016, with effect from 1.4.2016. [14] D3 acknowledged receipt of D1’s letter dated 15.6.2016 which was addressed to the Plaintiff and states that MRCB demanded D1 to supply 100 skilled workers for construction works at the Westin Project site. THE PLAINTIFF’S CASE [15] On 13.6.2016, the Plaintiff issued a Letter of Award (‘LoA’) to D4, trading as D1, for the brick wall, plastering and skim coat works (‘Brick Wall Works’) at Block C & D in respect of the Westin Project, Package Name: MBSB/15002/WK/SC016 for the provisional amount of RM2,229,732.00. The Confirmation of Acceptance was signed by D4 on 12.7.2026 and witnessed by D5. [16] The Plaintiff did not appoint D1 for the supply of labour for preparatory construction work (tiling work) from June 2016 to November 2016 (‘Tiling Work’). [17] D2 and D3 did not have the requisite authority to appoint D1 to supply labour for the Tiling Work. [18] D1 issued the following progress claims for supply of labour for the Tiling Work: Date Progress Claim No.

19.6.2016 1 Supply of labour from 23.5.2016 – 20.6.2016 73,830.00 19.7.2016 2 Supply of labour from 21.6.2016 – 30.6.2016 17,280.00 31.8.2016 3 Supply of labour on July 2016 182,528.60 Supply of labour on August 2016 297,056.20 30.11.2016 6 Supply of labour on September 2016 352,210.00 Supply of labour on November 2016 724,500.00 31.12.2016 7 Supply of labour on October 2016 703,974.20 31.3.2017 8 Supply of labour on October 2016 (brought 703,974.20 forward from Progress Claim No. 7) Supply of labour on November 2016 (brought forward from Progress Claim No. 6) 724,500.00 2,351,379.00 [19] The Plaintiff’s stance was that the above Progress Claims are not genuine and D1 had failed to adduce proof for its Progress Claims. Thus, D1 is not entitled to claim the sum of RM2,351,379.00. [20] The Plaintiff’s former Chief Executive Officer (‘CEO’), Zulbahari Abu Bakar (‘Zulbahari’) signed the Interim Payment Certificates (‘IPC’) as set out below due to the representation and assurances made by D2 and D3: IPC No. Total validated amount to be paid (not inclusive of 6% GST) Total claims for supply of labour for Tiling Work validated in IPC 1 73,830.00 73,830.00 2 239,541.03 17,280.00 3 339,532.26 570,694.80 6 345,063.50 352,210.00 922,904.80 [21] The Plaintiff had paid RM922,904.80 to D1 and this amount must be refunded to the Plaintiff. [22] D2, D3, D4 and D5 had conspired in using D1 to submit the purported Progress Claims and as a vehicle with the sole intention to unjustly enrich themselves at the expense of the Plaintiff. [23] In the premises, in paragraph 53 of the SoC, the Plaintiff claimed against the Defendants, jointly and or severally for, among others, the following:

a declaration that D1 never provided labour for the preparatory construction work (Tiling Work) to the Plaintiff from June until

the Defendants pay the Plaintiff the sum of RM922,904.80;

a declaration that D1 never provided labour for the preparatory construction work (Tiling Work) in October and November 2016 for the sum of RM1,428,474.20 without GST;

a declaration that the Plaintiff is not liable to pay D1 for the purported supply of labour for the Tiling Work in October and November 2016 in the sum of RM1,428,474.20;

alternatively, if the Court makes any finding as to the liability of the Plaintiff, a declaration that D2 and D3 shall indemnify the Plaintiff against all claims, expenses, costs, interests and liabilities borne as a result of the conduct of D2 and D3;

a declaration that D1 is barred/ prevented from enforcing the above fabricated claims in any other legal forum;

general damages for breach of contract against D2 and D3 to be assessed by the Court;

general damages against D2 and D3 for colluding with D1 to cause loss to the Plaintiff;

special damages to be proved; and

aggravated and exemplary damages against D2 to D5 as pleaded in paragraphs 46 and 51 of the SoC. THE DEFENDANTS’ CASE - D1, D4 and D5 [24] According to D1, D4 and D5, during D1’s course of works, D1 was instructed by the Plaintiff to supply skilled and semi-skilled workers for the Westin Project. D1 had written to the Plaintiff to confirm the instructions vide letters dated 13.6.2016, 15.6.2016, 3.7.2016,

13.7.2016, 19.9.2016 and 28.9.2016. [25] The Plaintiff had promised D1 that an official LoA solely for the supply of labour would be issued by the Plaintiff to D1. However, no such LoA was ever issued to D1. [26] D1 claimed that it had performed its scope of works as stipulated under the Sub-Contract and it had also supplied labour to the Plaintiff. D1 submitted its interim claims accordingly and the Plaintiff had certified and made payments for D1’s Interim Claim Nos. 1 to 6. The Plaintiff did not at any time object to any of these Interim Claims. [27] D1 had handed over the works required to be completed to the Plaintiff on 31.7.2017 and the Final Claim for the brick wall works for the period ending 31.7.2017, including variation order works, amounting to RM2,258,536.10 (not inclusive of 6% GST) was accordingly submitted. However, the Plaintiff has not made any payment and neither has it released the retention monies. [28] Apart from the LoA dated 13.6.2016, the Plaintiff awarded two other works for the Westin Project to D1, namely –

the LoA dated 20.10.2016 for the “Supply and Lay Natural Iron-Ore Stone” (‘Stone Works’). A total of three IPC were issued by the Plaintiff to D1 for the value of works done for the Stone Works for the period ending January 2017. At a meeting held on 13.7.2017 (‘13.7.2017 Meeting’), it was agreed that D1 shall complete the remaining works for the Project and hand over the same to the Plaintiff on 31.7.2017. It is D1’s case that it had handed over the Stone Works to the Plaintiff on that date and therefore it is entitled to the release of the retention monies and Performance Bond (‘PB’) held for the Stone Works amounting to RM67,706.10 as stipulated under IPC No. 3; and

the LoA dated 26.2.2017 for the Architectural Works (Plastering and Paving, RC Works, Brickworks, Toilet Partitions, External and Internal Door and Window, Ironmongery, Metalwork, Waterproofing, Wall and Tiles Finishes, Sanitary Fittings, Rainwater Downpipe) (‘Architectural Works’). One IPC was issued by the Plaintiff to D1 for the value of works done for Architectural Works whereby a sum of RM22,477.86 was retained as retention monies. In July 2017, D1 found out that the Plaintiff had, without notice, engaged another sub-contractor to carry out D1’s scope of works under this LoA. At the 13.7.2017 Meeting, the parties verbally agreed for D1 to hand over the works to the Plaintiff. Hence, D1 is entitled to the release of the retention monies amounting to RM22,477.86 as stipulated under IPC No. 1 as the works have been handed over to the Plaintiff. [29] D1 counter-claimed against the Plaintiff for works done by D1 for the Westin Project as follows:

Final Claim for Brick Wall Works for the period ending 31.7.2017 2,394,048.27 (inclusive of 6% GST)

Release of retention monies and PB for Stone Works 67,706.10

Release of retention monies for Architectural Works 22,477.86 2,484,232.23 [30] Further, D1 claimed for general damages or alternatively, for damages or claims to be assessed and to be paid by the Plaintiff to D1 premised on the principle of quantum meruit. [31] With regards to D4 and D5, they took the position that they only carried out their duties as partners of D1. D4 alleged that he was not personally or directly involved in handling and managing the contracts under the Westin Project. D4 and D5 asserted that the Plaintiff’s conduct in dragging them in this suit is frivolous, unreasonable and done in bad faith to injure them. [32] D1, D4 and D5 vehemently denied the Plaintiff’s contention that there are elements of fraud or conspiracy. They claimed that the Plaintiff’s allegations are baseless, vexatious and a tactic to avoid making payments to D1 for the works done under the contracts. - D2 [33] D2 claimed that, for the Westin Project, the existing sub-contractor was KLK Synergy Sdn Bhd (‘KLK’) or companies related to KLK. As the work progress was slow, Zulbahari had instructed D2 to appoint a new sub-contractor to finish the works. [34] Therefore, D1 was appointed by the Plaintiff to carry out the sub-labour work at Sites C and D for the Westin Project. This appointment was approved by the Plaintiff and Zulbahari. However, there was a delay in the process of issuing the LoA by the Plaintiff. Due to this delay, Zulbahari had instructed D2 to instruct D1 to start the works to avoid further delay in the construction works. [35] D2 insisted that, at all material times, he had acted within the authority given to him by the Plaintiff as the Project Director and no false representations were made by D2 in respect of the appointment of D1 or in other matters. D2 did not obtain any profit out of the Westin Project and therefore, the issue of unjust enrichment and conspiracy is a non-starter. [36] D2’s explanation for his resignation was that he was informed by Zulbahari to lie and to blame the client for the problems in respect of the Westin Project. D2 did not do so and he was asked to leave the site and to return to the headquarters. Subsequently, D2 was informed by Zulbahari that D2 will be fired or terminated if D2 did not resign. [37] D2 took the firm position that Zulbahari is responsible or contributorily responsible towards the Plaintiff's claim considering that Zulbahari is involved in the decision-making process or verification and approval of the IPC. - D3 [38] D3 pleaded that he has no power or authority to appoint or employ any contractor, sub-contractor or supplier on behalf of the Plaintiff for the Westin Project and to approve any claim on behalf of the Plaintiff to D1. D3 was subjected to the instructions of D2 and the Plaintiff. [39] Zulbahari is the superior who was mandated by the Plaintiff to oversee the entire administration, management, supervision and direction of the Westin Project, and the Plaintiff has various layers of supervision. Similar to D2, D3 asserted that knowledge of D1’s involvement in the Westin Project was within Zulbahari’s knowledge as the CEO of the Plaintiff at the material time. [40] D3 denied that he had –

breached his contractual obligations as a Project Manager while under the Plaintiff's employment;

engaged in any fabrication of false claims for D1 against the

assisted and co-operated with D1 and D2 or any party to submit false claims to the Plaintiff;

given any false representation or false assurance to Zulbahari regarding the supply of labour by D1 as all payments to D1 were approved, signed and verified by Zulbahari himself; and

enrich himself unjustly and at the expense of the Plaintiff or intend to cause any damages to the Plaintiff. [41] In relation to the investigation conducted by the Integrity and Disciplinary Department against D3, he has no personal knowledge of the same. THE TRIAL & AGREED ISSUES TO BE TRIED [42] The trial was held over nine days. During that period, the Plaintiff called two witnesses; D1, D4 and D5 called four witnesses and D2 and D3 each called one witness. The particulars of the witnesses are as shown below: Witness Name Designation PW1 Mr. Lok Ngai Hey Plaintiff’s Chief Executive Officer and Director PW2 Ms. Goh Gan Kee Plaintiff’s Senior Manager, Contracts in Engineering, Construction and Environment Division DW1 Mr. Foo Kee Leang (D4) Partner in D1 DW2 Mr. Lee Chee King D1’s Administration Manager DW3 Mr. Chong Choon Keong D1’s Project Manager [43] The Agreed Issues To Be Tried (‘ITBT’) are as follows: “1. Whether there exists any contractual relationship between P and D1 for the supply of labour for the project known as Cadangan Westin Desaru Resort di Desaru Johor Darul Takzim untuk Corniche Hotel Sdn Bhd (“the Project”).

Whether P is liable to pay D1 for all the services rendered under the terms of the three LoA and the alleged supply of labour agreement for the Project?

Whether D1 has carried out the works and the following Progress Claims are valid: - DW4 Mr. Lim Soon Seng (D5) Partner in D1 DW5 Mr. Chai Yee Hin (D3) Business Development Manager, Shanghai Tunnel Engineering and Construction (Malaysia) Sdn Bhd and Plaintiff’s former Project Manager DW6 Mr. Chan Kah Wai (D2) Project Manager at Pembinaan Tegap and former Plaintiff’s former Project Director Date Progress Claim No.

Total (RM)

6.2016 1 Supply of labour from 23.5.2016 – 20.6.2016 73,830.00 19.7.2016 2 Supply of labour from 21.6.2016 – 30.6.2016 17,280.00 31.8.2016 3 Supply of labour on July 2016 182,528.60 Supply of labour on August 2016 297,056.20 30.11.2016 6 Supply of labour on September 2016 352,210.00 Supply of labour on November 2016 724,500.00 31.12.2016 7 Supply of labour on October 2016 703,974.20 31.3.2017 8 Supply of labour on October 2016 (brought forward from the Progress Claim No.7) 703,974.20 Supply of labour on October 2016 (brought forward from the Progress Claim No.6) 724,500.00 2,351,379.00

Whether D1 is entitled to the amounts as stated in D1’s Progress Claims.

Whether D2, D3, D4 and D5 had conspired, combined and acted in concert to submit D1 Progress Claims with the intention to unjustly enrich themselves at the expense of P.

Whether D2, D3, D4 and D5 have breached their contractual duties.

Whether the corporate veil of D1 should be lifted to impose liability against D4 and D5.

Whether P is entitled to the following reliefs: “(i) A declaration that the 1st Defendant never provide labour for the preparatory construction work (tiling work) to the Plaintiff from June until November 2016;

(ii) That the Defendants pay the Plaintiff a sum of RM922,904.80 as pleaded;

(iii) A declaration that the 1st Defendant never provide labour for the preparatory construction work (tiling work) on October and November 2016 for the sum of RM1,428,474.20;

(iv) A declaration that the Plaintiff is not liable to pay the 1st Defendant for the purported supply of labour for the preparatory construction work (tiling work) on October and November 2016 in the sum of RM1,428,474.20;

Alternatively, if this Honourable Court makes any finding as to the liability of the Plaintiff, a declaration that the 2nd and 3rd Defendants shall indemnify the Plaintiff against all claims, expenses, costs, interests and liabilities borne as a result of the conducts of the 2nd and 3rd

(vi) A declaration that the 1st Defendant is barred / prevented from enforcing the above fabricated claims in any other legal forum;

(vii) General damages for breach of contract against the 2nd and 3rd Defendants (to be assessed by this Honourable Court);

(viii) General damages against the the 2nd 3rd, 4th and 5th Defendants for colluding with the 1st Defendant to cause loss to the Plaintiff;

(ix) Special damages to be proved;

Aggravated and exemplary damages as pleaded in paragraphs 46 and 51 of the Plaintiff’s Re-Amended Statement of Claim;

(xi) Pre-judgment interest on any damages awarded by this Honorable Court pursuant to Section 11 of the Civil Law Act 1956 from the date of the Writ until the date of the judgment at the interest rate of 4% per annum;

(xii) Post-judgment interest on any damages awarded by this Honorable Court pursuant to Section 11 of the Civil Law Act 1956 from the date of judgment until the date of full and final realisation at the interest rate of 5% per annum…”

Whether D1 is entitled to its counterclaim against P: “(i) Payment of RM 2,484,232.23 being the amount due and owing to the 1st Defendant by the Plaintiff for works done by the 1st Defendant or any other sum found due and payable by Plaintiff to the 1st

(ii) General Damages;

(iii) Further or in the alternative, damages/claims to be assessed and to be paid by the Plaintiff to the 1st Defendant premised on quantum meruit basis;

(iv) Interests at the rate of 5% on the judgment sum calculated from the date of the filing of this writ action until the date of full settlement by the Plaintiff...”

Whether D1 is entitled to claim for reasonable value of services performed or benefited by P for the work done for the Project under the principle of quantum meruit?”. FINDINGS OF THE COURT [44] At the outset, it should be made clear that, at the end of the trial, the Plaintiff pursued all the reliefs as prayed in the SoC even though its written submissions did not address the issues of general, aggravated and exemplary damages. During the clarification session, the learned counsels who represented all the parties agreed that the issue of quantum of damages will be addressed in subsequent written submissions if the Court finds that the Defendants are liable for the same. 1st Issue: Whether there exists any contractual relationship between the Plaintiff and D1 for the supply of labour for the Westin Project 5th Issue: Whether D2, D3, D4 and D5 had conspired, combined and acted in concert to submit D1’s Progress Claims with the intention to unjustly enrich themselves at the expense of the Plaintiff [45] The 1st and 5th Issues revolve around the same or similar consideration of the oral and documentary evidence and arguments of the parties in relation to the alleged conspiracy to submit false claims for the supply of labour for the Westin Project. Both these Issues will be addressed together. [46] It is the Plaintiff’s pleaded case that there was no supply of labour by D1 for the Westin Project as there was no LoA issued by the Plaintiff to D1 for such supply. [47] The Plaintiff contended that there was no agreement for supply of labour as –

there is no written LoA to evidence it and D1 never wrote to the Plaintiff to request for such written agreement;

the LoA for Brick Wall Works was issued on 13.6.2016 and D1 accepted the same on 12.7.2016. Before the acceptance of the LoA for Brick Wall Works by D1, it had submitted Progress Claim No. 1 dated 19.6.2016 for the sum of RM73.830.00 for the supply of labour. This shows that, at the material time, there is no agreement other than the LoA for Brick Wall Works wherein D1 “… unconditionally and irrevocably agree, confirm and accept the terms and conditions …” in the LoA. D1 “… further acknowledged that the said Letter of Award shall constitute a legally binding contract and that in the event of any dispute[s) arising between the parties, the contents of the Letter of Award shall prevail.”.

the rates in the LoA for Brick Wall Works are fixed rates and inclusive of labour cost. A separate agreement for supply of labour will render Clauses 1.2, 1.3, 1.5 and 1.8 of the LoA for Brick Wall Works to be redundant, ineffective and meaningless;

it does not make sense for the Plaintiff in not wanting a written agreement as the Plaintiff’s interest through the retention sum, performance bond, indemnity clause and defects liability will be protected by a written LoA;

there are no variation orders and D1 is estopped from alleging the existence of a separate agreement. D1 issued the quotations and letters purportedly pursuant to five Main Contractor’s Instruction (‘MCI’) under the LoA for Brick Wall Works. The five MCIs contain the following statement: “This instruction ls issued as part of your scope of Works under your Sub-Contract. If the Sub-Contractor considers that this instruction constitutes a variation, thus Sub-Contractor shall inform the Contractor of any programme and cost implication within three (3) worklng days of receiving the MCI and should not proceed with the Works until authorization from the Contractor is duly given via “Variation Order”. Failure by the Sub-Contractor to advice implication of programme and cost is deem that the Sub-Contractor hereby agrees that this Instruction shall be within the scope of Works of the existing Work Contract.”. D1’s witnesses gave evidence that they proceeded with the work upon receipt of MCIs. At no point in time, they had stopped and requested for Variation Orders. [48] It was further argued by the Plaintiff that D1’s quotations and purported letters of confirmation cannot be accepted as proof of contract for supply of labour. At best, these documents demonstrate a verbal arrangement between D1, D2 and D3 and by virtue of s 92 of the Evidence Act 1950 [Act 56] (‘EA 1950’), they cannot be used to rewrite the LoA for Brick Wall Works and cannot bind the Plaintiff. [49] The Plaintiff pleaded that at all material times, the Defendants had conspired to create the fraudulent claims that were submitted by D1 to the Plaintiff and D2 and D3 have full knowledge of the same and had assisted D1 to support the fraudulent claims. D2 to D5 were said to have executed a fraudulent scheme to enrich themselves and cause financial loss to the Plaintiff (see paragraphs 19 - 21 of the SoC). [50] At the end of the trial, the Plaintiff submitted the following acts of conspiracy by D2 and D3 in submitting claims which are false and unsubstantiated with contemporaneous documents to defraud the Plaintiff: Conspiracy No. 1: Backdating of two MCIs dated 23.5.2016 Conspiracy No. 2: D2 and D3 through both MCIs dated 23.5.2016 allowed D1 to claim for supply of labour with the rates stated in D1’s quotation dated 13.6.2016 without authority from the Plaintiff Conspiracy No. 3: D2 and D3 through 2 MCIs dated 1.7.2016 and 2.7.2016 allowed D1 to claim supply of labour with the rates stated in D1’s letter dated 13.6.2016 without authority from the Plaintiff Conspiracy No. 5: D3 through MCI dated 4.7.2016 allowed D1 to claim supply of labour with the rates stated in D1’s quotation dated 3.7.2016 without authority from the Plaintiff Conspiracy No. 6: D2 and D3 allowed D1 to supply additional labour with D1’s letters dated 19.9.2016 and 28.9.2016 without authority from the Plaintiff Conspiracy No. 7: D2 verified D1’s Progress Claims Nos. 1 to 3 without any Kong Cards, Daily Site Reports and List of Workers Conspiracy No. 8: D2 and D3 assisted D1’s claims by misleading the Plaintiff into thinking that it was paying D1 under the original contract [51] After due consideration of the pleadings, evidence and submissions by the parties, I was constrained to find that the Plaintiff (for the burden of proof, see ss 10, 101, 102 and 103 of the EA 1950) has failed to prove, on a balance of probabilities [for the standard of proof, see Sinnaiyah & Sons Sdn Bhd v Damai Setia Sdn Bhd [2015] 5 MLJ 1; [2015] 7 CLJ 584 (FC) and Ling Peek Hoe & Anor v. Ding Siew Ching & Another Appeal [2017] 7 CLJ 641 (FC)], its allegation of conspiracy involving D2 to D5 to create fraudulent claims. My reasons for this finding are as follows:

Pleadings It is trite law that parties to a suit are bound by what have been pleaded in their respective pleadings [see Ketua Pengarah Jabatan Kerja Raya v Strongkota Development Sdn Bhd & Another Appeal [2016] MLJU 820 (CA)]. Generally, the two forms of the tort of conspiracy are conspiracy to injure either by unlawful means or by lawful means. A plaintiff who alleges that there is a conspiracy against another party must set out in its pleading the particulars as to the type of conspiracy involved and how the conspiracy was committed, its extent and the consequences or injuries suffered by the plaintiff pursuant to the act of conspiracy committed by the other party. In the SoC, the Plaintiff did not state whether it was relying on unlawful conspiracy or lawful conspiracy. Clearly, the Plaintiff failed to plead the form of the tort of conspiracy it is alleging against the Defendants. Furthermore, the burden of proof is on the Plaintiff to establish that there is an agreement between the Defendants; the agreement was for the purpose of injuring the Plaintiff; and the acts done in execution of that agreement resulted in damage to the Plaintiff (see the judgments by the Court of Appeal in Renault SA v Inokom Corp Sdn Bhd & Anor and other appeals [2010] 5 MLJ 394, SCK Group Bhd & Anor v Sunny Liew Siew Pang & Anor [2011] 4 MLJ 393 and Koperasi Permodalan Felda Malaysia Bhd v Icon City Development Sdn Bhd (formerly known as ‘Sierra Peninsular Development Sdn Bhd’) & Anor [2023] 2 MLJ 338). However, the Plaintiff failed to plead that there was an agreement between the Defendants to conspire for the purpose of injuring the Plaintiff.

Hearsay evidence It is trite law that hearsay evidence cannot establish conspiracy [see Khoo Teng Chye v Cekal Berjasa Sdn Bhd & Anor [2015] MLJU 992 (CA)]. The evidence given by PW1 and PW2 were largely on matters which are not within their personal knowledge. Whatever they knew was derived from the documents which they had seen and from their own interpretation of the same. In this regard, s 60 of the EA 1950 provides that: “Oral evidence must be direct

60.

Oral evidence shall in all cases whatever be direct, that is to say –

if it refers to a fact which could be seen, it must be the evidence of a witness who says he saw it;

if it refers to a fact which could be heard, it must be the evidence of a witness who says he heard it;

if it refers to a fact which could be perceived by any other sense or in any other manner, it must be the evidence of a witness who says he perceived it by that sense or in that manner;

if it refers to an opinion or to the grounds on which that opinion is held, it must be the evidence of the person who holds that opinion on those grounds.

The opinions of experts expressed in any treatise commonly offered for sale and the grounds on which such opinions are held may be proved by the production of the treatise if the author is dead or cannot be found or has become incapable of giving evidence or cannot be called as a witness without an amount of delay or expense which the court regards as unreasonable.

If oral evidence refers to the existence or condition of any material thing including a document, the court may, if it thinks fit, require the production of that material thing or the document for its inspection.”. Evidence given by a witness on matters which are not in his personal knowledge are hearsay evidence (see Parkwood Palms Sdn Bhd v Pemungut Duti Setem [2021] MLJU 1332). PW1 and PW2 were not personally involved in the construction stage of the Project and had no personal knowledge on any matters in relation to the Westin Project. The construction works had commenced in 2016. PW1 assumed his post as the CEO in March 2019. In cross-examination, PW1 said that the was only involved during the post-construction stage i.e. the closing of final accounts when the Westin Project was already completed. Similarly, PW2 joined the Plaintiff after the Westin Project was completed. Specifically, PW1 and PW2 had no personal knowledge on the process and events which took place such as to lead to the issuance of the Plaintiff’s IPC to D1. PW1 and PW2 were not the persons who prepared, verified and/ or signed the IPCs and neither were they the persons who conducted the investigations against the Defendants.

Adverse inference I accepted the submission by the learned counsel for D1, D4 and D5 that an adverse inference under s 114(g) EA 1950 should be invoked against the Plaintiff for its failure to call the following witnesses:

Zulbahari, the Plaintiff’s ex-CEO who approved the IPCs PW1 testified that the CEO who was involved in the Westin Project was Zulbahari and he would have personal knowledge on any issues relating to the construction stage of the Westin Project. Zulbahari’s name appears several times in the pleadings, but the Plaintiff did not call Zulbahari as a witness because, according to PW1, he was involved in other court cases such as MRCB v Kwang Li and MRCB v Thien Hong where Zulbahari’s schedule clashes with this case. This is a lame excuse as the Plaintiff’s counsel should have informed the Court of Zulbahari’s available dates at the time when the Court was fixing the trial dates for this case. I doubt PW1 was being truthful when explaining Zulbahari’s absence because Mr. Rohan is also the counsel for three defendants in MRCB v Kwang Li and yet, he was present on all trial dates in this court.

(ii) Samarasam a/l Krishnan, the Head of Integrity and Discipline Department and Venkitesan a/l V N Venugopal, Samarasam’s Assistant These individuals investigated on, and made findings against, the Defendants. Venkitesan made several police reports on behalf of the Plaintiff against the Defendants. PW1 testified that the Plaintiff’s in-house Legal Department advised that Samarasam should not be called as a witness and PW1 decided to act on the advice.

(iii) Mohd Arif Ahmad, the Contract Manager who prepared IPC No. 1 and No. 2

(iv) Peter Cheng Chen Choy, the Interim Head of Contract who verified IPC No. 1 and No. 2

Muhammad Fazuan Bin Zul Kepaly, the Senior Quantity Surveyor (‘QS’) who prepared the Site Verification for IPC

(vi) Siti Amalina Azhar, the QS who prepared IPC No. 2

(vii) Mohammad Fadzeli B Zainal Abidin, the Senior QS who prepared Site Verification No. 2 and No. 3

(viii) Aldela Puspa Nordin, the Contracts General Manager who prepared IPC No. 6

(ix) Siti Yasmini Yunus, the QS who prepared Site Verification No. 6 The IPCs in respect of D1’s claim for supply of labour under Progress Claims Nos. 1, 2, 3 and 6 were prepared, verified and signed off by different personnel within the Plaintiff’s organisation before they were issued to D1. In addition, Site Verifications were similarly prepared, verified and signed by various personnel of the Plaintiff. Mr. Rohan had prepared a table in his Written Submissions to show the personnel involved as follows: Prepared by Verified by Approved by Reference IPC No. 1 Mohd Arif Ahmad (Manager, Contract) Peter Cheng Chen Choy (Interim Head of Contract) Zul Bahari p 3, B3 Site Verification for IPC No. 1 Muhammad Fazuan Bin Zul Kepaly (Senior QS) Chan Kah Wai (Project Director) Nil p 7, B3 IPC No. 2 Siti Amalina Azhar (QS) / Mohd Arif Ahmad Peter Cheng Chen Choy Zul Bahari p 73, B3 Site Verification No. 2 Mohammad Fadzeli Bin Zainal Abidin (Senior QS) Chan Kah Wai Nil p 75, B3 IPC No. 3 Khoo Chee Wai (Senior Contract Manager) Chan Kah Wai Zul Bahari p 143, B3 Site Verification No. 3 Mohammad Fadzeli Bin Zainal Abidin Chan Kah Wai Nil p 144, B3 IPC No. 6 Aldela Puspa Nordin (General Manager, Contracts) Nil Zul Bahari p 203, B3 Site Verification No. 6 Siti Yasmini Yunus (QS) Khoo Chee Wei Nil p 204, B3 Based on the table, the learned counsel had rightly submitted that the Plaintiff’s IPCs went through a comprehensive process involving multiple levels and different personnels in a variety of departments within the Plaintiff’s organization, each with distinct roles and duties, before they were issued to D1. IPC No. 6 was not verified by D2. In cross-examination, PW1 agreed that it was not only D2 who was involved in the certification process. Apart from D2, none of these other personnels were called as a witness at the trial. Significantly, the Plaintiff’s Quantity Surveyors had prepared the site verifications for IPC Nos. 1, 2, 3 and 6 but none of them were called to give evidence for the Plaintiff. No explanation was forthcoming from the Plaintiff for this failure. All the above-mentioned individuals are material witnesses and there can be only one reason as to why the Plaintiff did not call them to testify at the trial; that they will give evidence which is unfavourable to the Plaintiff’s case.

The alleged conspiracy The grounds relied on by the Plaintiff to allege conspiracy against the Defendants were that –

D1 had submitted claims for supply of labour to the Plaintiff for the Westin Project;

(ii) the Plaintiff had certified D1’s claim for supply of labour;

(iii) the Plaintiff had paid D1 based on the Plaintiff’s own certification; and

(iv) the Plaintiff had only certified D1’s claim based on the representation of D2 and/ or D3. The Plaintiff relied on the case of Khalek Awang & Anor v. Koperasi Perumahan Kluang Bhd & Another Appeal [2021] 10 CLJ 238 (CA) and the excerpt from Lim Chong Fong’s (now JCA) Law and Practice of Construction Law in Malaysia, Sweet & Maxwell, 2021 at pp 351 - 352 to support the submission that the circumstantial evidence in this case showing there is collusion in the issuance of the IPCs is compelling, convincing and overwhelming. The Plaintiff’s case of conspiracy is founded on contemporaneous documents consisting of the LoA, MCIs, D1’s letters and Progress Claims, IPCs, Kong Cards, Daily Site Reports and list of workers whereby it was contended that D1 bears the burden to prove the supply of labour and to provide an explanation on the said contemporaneous documents. On the other hand, D1, D4 and D5 argued that the Plaintiff has not satisfied the tests for circumstantial evidence as laid down in these cases: Hamzah bin Abdul Majid v Mohd Jalani bin Datuk Hj Mohd Sidek & Ors [2014] MLJU 1858 where in paragraph 138 it was held that “However, it is settled law that when a case rests on circumstantial evidence, such evidence must satisfy three tests. Firstly, the circumstances from which an inference of guilt is sought to be drawn must be cogently and firmly established. Secondly, those circumstances should be of a definite tendency unerringly pointing towards the guilt of the accused/the other party. Thirdly, the circumstances, taken cumulatively, should form a chain so complete that there is no escape from the conclusion that within all human probability the crime was committed by the accused and no one else. That is to say the circumstances should be incapable of explanation on any reasonable hypothesis save that of the accused’s guilt (see Chandmal & Anor v. State of Rajasthan AIR [1970] SC 917, quoted with approval in the case of Lim Hean Chong v. PP [2012] 2 CLJ 1046 (CA)).”; and Asia Pacific Parcel Tankers Pte Ltd v The Owners of the Ship or Vessel ‘Normar Splendour’ [1999] 6 MLJ 652 where it was held that “The law relating to circumstantial evidence has been stated by this court in numerous decisions. It is needless to refer to them as the law on the point is well settled. In a case resting on circumstantial evidence, the circumstances put forward must be satisfactorily proved and those circumstances should be consistent only with the hypothesis of the guilt of the accused. Again those circumstances should be of a conclusive nature and tendency and they should be such as to exclude every hypothesis but the one proposed to be proved. In other words, there must be a chain of evidence so far complete as not to leave any reasonable ground for a conclusion consistent with the innocence of the accused and it must be such as to show that within all human probability the act must have been done by the accused.”. In my considered view, the Plaintiff did not discharge the legal burden of proving the tort of conspiracy against the Defendants based on the contemporaneous documents alone. The key element of an agreement between the Defendants with the intention to injure the Plaintiff remains unproven. I am not prepared to say that the circumstances put forward by the Plaintiff is consistent only with the hypothesis of collusion between the Defendants in the manner as claimed by the Plaintiff. There are unanswered questions in respect of the issuance of the IPCs and site verifications by various personnel of the Plaintiff. No evidence was presented by the Plaintiff to show that there was any personal relationship between D1, D4 and D5 with D2 and D3 outside of the Westin Project. [52] Premised on the foregoing reasons, I was not persuaded that a case of conspiracy has been proven by the Plaintiff against the Defendants. Following from this finding, there is no valid basis for the Court to grant the order as prayed by the Plaintiff for the Defendants to repay the Plaintiff the sum of RM922,904.80 (see paragraph 20 above). 6th Issue: Whether D2, D3, D4 and D5 have breached their contractual duties [53] It is the Plaintiff’s pleaded case that, in view of D2’s and D3’s conduct in assisting and cooperating with D1 to create fraudulent claims and together with D4 and D5, in executing a fraudulent scheme to enrich themselves at the Plaintiff’s expense, D2 and D3 have acted in mala fide against the interests of the Plaintiff and for improper purposes in relation to the affairs of the Plaintiff, and have breached their contract of employment by –

failing to act honestly at all times and to use reasonable diligence in the discharge of their duties as the Project Director and Project Manager, respectively;

making improper use of information acquired as the Project

knowingly assisting D1 to defraud or cause loss to the Plaintiff; and

directly or indirectly gaining financial advantage for themselves. (see paragraphs 42 - 45 of the SoC). [54] Additional facts were pleaded to show D2’s and D3’s mala fide conduct, namely, in relation to the evidence which they had given in favour of Thien Hong Machinery (M) Sdn Bhd in the arbitration initiated by that company against the Plaintiff for the sum of RM5,285,825.19. D2 and D3 are said to have tendered their resignation in the midst of the internal investigation carried out by the Plaintiff’s Integrity and Discipline Department on the inaccurate claims made by that company (see paragraphs 45A - 45M of the SoC). [55] Although the abovementioned facts were raised in the SoC, at the end of the trial, the Plaintiff’s submission was mainly on its claim as found in paragraphs 19 - 21 of the SoC that the Defendants had conspired to create the fraudulent claims which were submitted by D1 to the Plaintiff so as to enrich themselves and cause financial loss to the Plaintiff. [56] Therefore, it is the Court’s finding that the Plaintiff has abandoned the cause of action as reflected in the 6th issue by not making any submission as to the matters pleaded in paragraphs 42 - 45 of the SoC. 7th Issue: Whether the corporate veil of D1 should be lifted to impose liability against D4 and D5 [57] In respect of this issue, firstly, it was undisputed that D1 is a business in the form of a partnership and is governed under the Partnership Act 1961 [Act 135]. [58] Section 11 of Act 135 provides that: “Liability of partners

Every partner in a firm is liable jointly with the other partners for all debts and obligations of the firm incurred while he is a partner; and after his death his estate is also severally liable in a due course of administration for such debts and obligations, so far as they remain unsatisfied but subject to the prior payment of his separate debts.”. [59] Clearly, Act 135 does not confer legal personality on a partnership (see HT Maltec Consultants v Malaysian Resources Corporation Bhd & Ors [2015] MLJU 2383) and based on s 11, the partners of a partnership are liable jointly with the other partners for all debts and obligations of the firm incurred while he is a partner. [60] Applying these legal principles to the facts of the instant case, D1 is a partnership, which is not separate legal entity, and D4 and D5 as the partners of D1 would be liable for any orders made by this Court against D1 in this suit. The Plaintiff itself had submitted to this effect in its written submission. [61] Thus, I agree with Mr. Rohan’s submission that, to bring in D4 and D5 as separate Defendants in this suit, is redundant and has caused unnecessary additional cost to D4 and D5. This is a relevant factor to be considered in determining the award of costs. [62] Basically, the issue of lifting D1’s corporate veil does not arise as it is a partnership. 8th Issue: Whether the Plaintiff is entitled to the reliefs as stated in paragraph 53 of the SoC [63] In view of the findings in respect of the earlier Issues as discussed above, the 8th Issue is answered in the negative. 2nd Issue: Whether the Plaintiff is liable to pay D1 for all the services rendered under the terms of the three LoA and the alleged supply of labour agreement for the Westin Project 3rd Issue: Whether D1 has carried out the works and its Progress Claims are valid 4th Issue: Whether D1 is entitled to the amounts as stated in its Progress Claims 9th Issue: Whether D1 is entitled to its counterclaim against the Plaintiff [64] The 2nd, 3rd, 4th and 9th Issues are interrelated and will be addressed together. [65] The Plaintiff submitted that D1 bears the burden to prove that it had supplied labour to the construction site and that it is not for the Plaintiff to prove otherwise as –

D1 had agreed in the LoA for Brick Wall Works to submit claims with supporting documents;

it is industry practice for a sub-contractor to substantiate its claims;

D1 filed a counterclaim for the purported supply of labour;

Interim Certificates are not final determination of actual work done by a sub-contractor; and

the Plaintiff bears the burden to prove fraud or conspiracy. The Plaintiff does not bear the burden to prove there is no supply of labour. No adverse inference can be drawn against the Plaintiff. [66] D1 had issued the following Progress Claims to the Plaintiff for the Brickwall Works at Blocks C and D and for the supply of labour for the Westin Project: DATE CLAIMS

19.6.2016 Progress Claim No. 1 73,830.00 pp 74 - 79, B2 19.7.2016 Progress Claim No. 2 298,377.13 pp 80 - 97, B2 31.8.2016 Progress Claim No. 3 618,195.95 pp 98 - 112, B2 30.9.2016 Progress Claim No. 4 686,359.25 pp 1 - 147, B2 31.10.2016 Progress Claim No. 5 914,491.81 pp 148 - 320, B9 30.11.2016 Progress Claim No. 6 1,164,899.66 pp 113 - 141, B2 31.12.2016 Progress Claim No. 7 780,780.80 pp 142 - 164 B2 31.3.2017 Progress Claim No. 8 1,974,655.53 pp 165 - 187, B2 8.3.2018 First Final Claim 595,282.83 pp 3 - 24, B8 15.10.2020 Final Claim 2,258,536.10 B5 & B6 [67] Subsequently, the Plaintiff issued six IPCs as follows: PROGRESS CLAIM NO. IPC CERTIFIED CERTIFIED AND PAID FOR SUPPLY OF LABOUR 1 1 73,830.00 73,830.00 pp 3 - 72, B3 2 2 239,541.03 17,280.00 pp 73 - 142, B3 3 3 339,532.26 479,584.80 pp 143 - 202, B3 4 4 397,995.37 - pp 94 - 125, B4 5 5 191,392.22 - pp 126 - 158, B4 6 6 345,063.50 352,210.00 pp 203 - 254, B3 Total 1,587,354.38 922,904.80 [68] On 31.12.2016 and 31.3.2017, D1 had submitted its Progress Claim Nos. 7 and 8 respectively to the Plaintiff for certification. The Plaintiff did not certify D1’s claims. [69] Thereafter, on 13.3.2018, D1 submitted its first Final Claim (‘First Final Claim’) to the Plaintiff. However, the Plaintiff did not certify the First Final Claim. [70] D1 then submitted another Final Claim on 15.10.2020 (‘Updated Final Claim’) to the Plaintiff for its certification. A summary of the items claimed by D1 under the Updated Final Claim is set out below: DESCRIPTION

General Conditions and Preliminaries 10,729.69 2. Block C 220,691.61 3. Block D 493,464.56 4. Variation Order – Supply labour for Prep Work (as per MCI) end October 683,505.00 5. Variation Oder – Supply labour for Tiling work and other works (as per MCI) end November 724,500.00 6. Supply Labour for Prep Work (as per MCI) end November 724,500.00 Total 2,153,360.06 (excluding GST) 2,394,048.71 (including GST) [71] As regards D1’s counterclaim against the Plaintiff for item nos. 1 to 3 in the above table for the sum of RM724,885.86 (without GST) being work done for the original scope of works i.e. brick wall, plastering and skim coat at Blocks C and D, PW2 testified that the Plaintiff did not certify this claim because it had exceeded the Sub-Contract Sum under the LoA. [72] However, as submitted by D1, –

it is not the Plaintiff’s pleaded case that D1’s works done under the original scope of works are invalid;

PW1 and PW2 did not give evidence against D1’s claim under the original scope of works;

Clause 1.1 of the LoA provides that the Sub-Contract Sum shall be for the provisional amount of RM2,229,732.00 inclusive of GST whilst Clause 1.4 states that “The quantities stated in the Bills of Quantities are provisional and subjected to re-measurement upon completion of the Work.”. Hence, the LoA is a provisional sum contract; it is only an estimate and the final contract sum has to be ascertained and accurately determined based on an assessment and evaluation of work done by way of re-measurement (see Tan Chang Yong Holdings Sdn Bhd v Corporate Sunrise Sdn Bhd [2017] MLJU 1734). In this regard, the Plaintiff’s reason for not certifying D1’s works has no valid basis; and

it has produced the supporting documents and calculation for its claim at pp 7 - 33, B5. [73] In view of the foregoing, D1’s counterclaim against the Plaintiff for the sum of RM724,885.86 (without GST) was allowed. Following from Mr. Rohan’s letter to the Court dated 18.4.2024 (encl. 239) regarding the error in the calculation of the total amount with GST, the Order made by the Court was corrected under the slip rule on 23.4.2024 whereby the sum with GST is RM768,379.01. [74] Turning to D1’s counterclaim against the Plaintiff for the supply of labour, D1 relied on the following supporting documents, which were submitted together with the Updated Final Claim: DESCRIPTION SUPPORTING DOCUMENTS 1 Variation Order-Supply labour for Prep Work (as per MCI) end October 2016 683,505.00 Daily Site Reports for October 2016 pp 34 - 95, B5 2 Variation Order-Supply labour for Tiling work and other works (as per MC1) end October 20,469.20 Daily Site Reports for October 2016 pp 34 - 95, B5 List of Workers for October 2016 p 96, B5 Kong Cards of tiling workers pp 97 - 103, B5 3 Supply Labour for Prep Work (as per MCI) end November 724,500.00 Daily Site Reports for November 2016 pp 3 - 62, B6 List of Workers for November 2016 pp 63 - 69, B6 Kong Cards of workers pp 70 - 207, B6 1,428,474.20 [75] Mr. Rohan highlighted that the number of workers provided by D1 to the Plaintiff and the type of works done by the workers can be seen in the Daily Site Reports, which were prepared, reviewed and signed by the Plaintiff's employee, Danny Anak Munan. [76] Basically, for the supply of labour in –

October 2016, D1 relied on the Kong Cards at pp 173 - 177 and 185 - 320, B9; Daily Site Reports at pp 34 - 95, B5 and List of Workers at p 172 and pp 178 - 184, B9 as proof that it had supplied 141 (136 + 5) labourers; and

November 2016, D1 relied on the Kong Cards at pp 70 - 207, B6; Daily Site Reports at pp 3 - 62, B6; and List of Workers at pp 136 - 141, B2 as evidence that it had supplied 138 labourers. [77] PW2 testified that the reason the Plaintiff did not certify the claim for supply of labour was that the claim is invalid. [78] In my considered view, D1’s claim for the sum of RM1,669,162.41 (including GST) for the supply of labour must be dismissed because D1 has not proven its claim, on a balance of probabilities, as the Kong Cards, Daily Site Reports and List of Workers to support the supply of labour in October and November 2016 are questionable. Specifically, –

when cross-examined, DW2, DW3, DW4, DW5 and DW6 agreed that the Kong Cards, Daily Site Reports and List of Workers are important documents as proof that the workers were carrying out work at the site;

in respect of the claim for supply of labour for the month of October 2016 – Progress Claim No. 5, the Kong Cards do not show any month and year and are not signed. D1 did not attach the Daily Site Reports with Progress Claim No. 5. Instead, the Daily Site Reports were attached with D1’s Updated Final Claim, and the 2nd page of the Daily Site Reports do not show any month and year. Pertinently, the total number of workers on the 1st page is different from the total number of workers on the 2nd page (see the tabulation in paragraph 65 of the Plaintiff’s Written Submission, encl. 210). In the answer to Question 10 in the Witness Statement, DW3 described the usual process for the supply of labour on site by D1 to the Plaintiff. Once the workers have completed the assigned tasks, their Kong Cards will be submitted to the Plaintiff’s representative for verification and signing. After the Kong Cards are signed, D1 will calculate and prepare the Progress Claims to the Plaintiff for the supply of labour. In re-examination, DW3 explained that “… Jadi untuk kong card-kong-card pada bulan Oktober saya perlu serahkan kepada pejabat saya semasa awal bulan November. Saya mendapati bahawa ia tidak ditandatangani, jadi saya telah pun menelefon Danny. Beliau memberitahu saya beliau agak sibuk sekarang sebab beliau perlu jaga juga kerja-kerja struktural.”. DW3’s answer is not believable because if “Danny” was truly very busy as alleged, he would not have signed both the Kong Cards and the Daily Site Reports whereas he purportedly did do so for the latter.

in respect of the claim for supply of labour for the month of November 2016 – Progress Claim No. 6, similarly, the Kong Cards do not show any month and year and are not signed. D1 did not attach the Daily Site Reports with Progress Claim No. 6. Instead, the Daily Site Reports were attached with D1’s Updated Final Claim, and the 2nd page of the Daily Site Reports do not show any month and year. The total number of workers on the 1st page is different from the total number of workers on the 2nd page (see the tabulation in paragraph 81, encl. 210). [79] Proceeding next to D1’s claim for the release of retention monies and PB under the LoA for Stone Works and the LoA for Architectural Works in the sum of RM67,706.10 and RM22,477.86, respectively, the relevant contractual provisions are Clauses 7.3, 7.5 and 8.1 of the LoA which read as follows: “7.3 One half (1/2) of the retention sum shall become payable free of interest within three (3) months upon the issuance of the Certificate of Practical Completion (CPC) for the Project and the remaining half (1/2) shall be payable (free of interest) upon the expiration of the Defect Liability Period (DLP) or the issuance of the Certificate of Making Good Defects (CMGD) for the Project and further upon the Sub-Contractor issuing the Main Contractor a Statutory Declaration pursuant to Clause 7.5 herein below. …

7.5 The payment for the Final Payment Certificates shall be released to the Sub-Contractor after the Sub-Contractor issuing to the Main Contractor the Final As-Built Drawings for the Work in accordance with clause 6.0 (if applicable) and a statutory declaration declaring that the Work under the Project has been duly completed and the financial obligations owing to its sub-contractors, suppliers, service providers and its workers (including salary and all statutory deductions thereto have been duly fulfilled and complied by the Sub-Contractor. …

8.1 The Sub-Contractor shall within fourteen (14) days from the date of the acceptance this Letter of Award, submit to the Main Contractor an unconditional and irrevocable Performance Bond as per the format provided in Appendix 3 herein, payable on first demand, and issued in favour of the Main Contractor by a bank approved by the Main Contractor and amounting to five percent (5%) of the Sub-Contract Sum, such guarantee being a security for the due performance by the Sub-Contractor of its obligations under the Sub-Contract and which will be held or remain in full force until the expiration of the Defects Liability Period (DLP) and/or issuance of the Certificate of Making Good Defects (CMGD) for the Work by the Main Contractor, whichever is shall be the later event.”. [80] D1 submitted, in respect of the Stone Works, that the Plaintiff did not raise any complaints regarding D1’s works and three IPC were issued by the Plaintiff to D1 for the period ending January 2017. Moreover, DW4 had testified that, at the meeting held on 13.7.2017, the Plaintiff and D1 agreed that D1 shall complete the remaining works for the Westin Project and hand over the same to the Plaintiff on 31.7.2017, and this was accordingly done by D1. [81] With regards to the Architectural Works, D1 made a similar submission that it had carried out the works and one IPC was issued by the Plaintiff to D1. DW4 gave evidence that the Plaintiff had engaged another sub-contractor to carry out D1’s scope of works and in the same meeting on 13.7.2017, the parties agreed for D1 to hand over the works to the Plaintiff. [82] D1 urged the Court to allow its claim for the release of retention monies and PB based on the fact that six years have passed since the Stone Works and Architectural Works were handed over to the Plaintiff and, since the Westin Project was completed in 2019, the Certificate of Practical Completion (‘CPC’) and Certificate of Making Good Defects (‘CMGD’) ought to have been issued to the Plaintiff. Moreover, the Plaintiff did not complain of any defective works by D1. [83] Having considered the submissions of the Plaintiff and D1, it is irrefutable that D1 did not adduce any evidence that it had complied with the contractual requirements for the retention monies and PB to be released to D1. Hence, D1’s claim was not allowed for the simple reason that D1 has not established that the conditions in Clauses 7.3,

7.5 and 8.1 of the LoA have been fulfilled. [84] By way of observation, in this case, D1’s claim for the release of retention monies and PB is not for something outside of the LoA or contract unlike the facts in the case of Hercules Engineering (SEA) Sdn Bhd v Naim Engineering Sdn Bhd [2024] 10 MLJ 72; [2024] 2 CLJ 837 which came to this Court on appeal (the decision of this Court was affirmed by the Court of Appeal on 13.1.2025). [85] The issue of passage of time since the expiry of the DLP and non-issuance of the CMGD was raised in another appeal which was heard in this Court i.e. Federal Furniture Industries Sdn Bhd v Ireka Engineering & Construction Sdn Bhd [2022] MLJU 1353 (the appeal to the Court of Appeal was struck out on 12.4.2023). However, in that case, there was evidence of the CPC having been issued, unlike in the present case. 10th Issue: In the alternative, whether D1 is entitled to claim for reasonable value of services performed or benefited by the Plaintiff for the work done for the Project under the principle of quantum meruit [86] D1 contended in the alternative, that the Plaintiff had benefitted from D1’s works for the Westin Project and it is justifiable on a quantum meruit basis that D1, D4 and D5 ought to be entitled to a reasonable remuneration for the works carried out in the sum of RM2,484,232.23. [87] The issue of D1’s claim for the supply of labour on the basis of quantum meruit does not arise because D1 has failed to establish that it had supplied labour for the months of October and November 2016. [88] In so far as D1’s claim for the release of retention monies and PB is concerned, cases such as Aneka Melor Sdn Bhd v. Seri Sabco (M) Sdn Bhd & Another Appeal [2016] 2 CLJ 563, Ch’ng Ghee Weng & Anor v. Lee Khoon Eng T/A Prestige Construction [2018] 10 CLJ 189, Syarikat Binaan Utara Jaya (a firm) v Koperasi Serbaguna Sungai Glugor Bhd [2009] 2 MLJ 546 and Kerajaan Malaysia v. Ken Reach Builders Sdn Bhd [2020] 1 LNS 1648 have decided that a claim based on the principle of quantum meruit cannot be invoked to override express provisions of the LoA. CONCLUSION [89] Premised on the foregoing reasons, the Plaintiff’s claim against the Defendants was dismissed and D1’s counterclaim was allowed for the sum of RM768,379.01 inclusive of 6% GST with interest at the rate of 5% per annum on the sum of RM724,885.86 calculated from 16.10.2020 (date of the counterclaim) until full settlement. [90] As for costs, the learned counsel for D1, D4 and D5 prayed for the sum of RM100,000.00 each for D4 and D5 on the ground that they were nominal Defendants who were dragged into this suit and thereby had incurred legal costs. For D1, as some of the counterclaim was dismissed and considering the length of the trial for nine days, costs of RM150,000.00 was sought. [91] In submitting for D2, apart from the length of the trial and complexity of the matter, Mr. R. Harikannan asked for costs of RM250,000.00 in view of the serious allegations against his client which hung over him for several years. [92] Mr. James Ding prayed for costs in the sum of RM150,000.00 for D3 for the same reasons as stated by the learned counsel for D2. [93] Mr. Amrit Pal proposed no order as to costs for D1 and costs of RM20,000.00 and RM15,000.00 for D2 and D3, respectively. Meanwhile for D4 and D5, the learned counsel suggested for no order as to costs for the Plaintiff’s claim and D1’s counterclaim. However, if the Court is minded to order costs, the learned counsel offered RM10,000.00 each for D4 and D5 [94] After deliberation, I ordered that the Plaintiff pays costs of –

RM100,000.00 to D2;

RM80,000.00 to D3;

RM50,000.00 to D4; and

RM50,000.00 to D5, and all costs are subject to allocatur. No order as to costs in respect of D1. Dated: 21 March 2025 (ALIZA SULAIMAN) Judge High Court in Malaya Kuala Lumpur Counsels/ Solicitors: For the Plaintiff: Amrit Pal Singh a/l Jaginder Sing (Ng Jun Wei with him) Messrs. Amrit & Company Advocates & Solicitors No. 32A, Jalan Telawi Bangsar Baru 59100 Kuala Lumpur For the 1st, 4th & 5th Defendants: Rohan Arasoo Jeyabalah (Lynn Foo and Ooi Hui Ying with him) Messrs. Harold & Lam Partnership Advocates & Solicitors Suite 32-5, 32nd Floor Oval Damansara No. 685, Jalan Damansara 60000 Kuala Lumpur For the 2nd Defendant: Harikannan Ragavan (Vanessa Victor with him) Messrs. Jayadeep Hari & Jamil Advocates & Solicitors Suite 2.03, 2nd Floor Block A, No. 45, Jalan Medan Setia Satu Plaza Damansara Bukit Damansara 50490 Kuala Lumpur For the 3rd Defendant: James Ding Tse Wen (Jovien Khew and Tey Siaw Ling with him) Messrs. C H Tay & Partners Advocates & Solicitors A-2-1, CENTRIO, Pantai Hill Park No. 1, Jalan Pantai Murni 1 Kampung Kerinchi 59200 Kuala Lumpur Cases, legislation and other sources referred to in the submissions by learned counsels and in the Grounds of Judgment: Cases: A. Santamil Selvi a/p Alau Malay @ Anna Malay & Ors v Dato’ Sri Mohd Najib bin Tun Abdul Razak & Ors [2015] MLJU 185 Asia Pacific Parcel Tankers Pte Ltd v The Owners of the Ship or Vessel ‘Normar Splendour’ [1999] 6 MLJ 652 Berjaya Times Square (formerly known as Berjaya Ditan Sdn Bhd) v M Concept Sdn Bhd [2010] 1 MLJ 597 Borneo Helicopters Sdn Bhd & Ors v Sabah Air Aviation Sdn Bhd (formerly known as Penerbangan Sabah Sdn Bhd) [2015] 1 MLJ 656 CGU Insurance Bhd v Asean Security Paper Mills Sdn Bhd [2006] 3 MLJ 1 Chong Song @ Chong Sum & Anor v Uma Devi a/p V Kandiah [2011] 2 MLJ 585 Cubic Electronic Sdn Bhd v MKC Corporate & Business Advisory Sdn Bhd and another appeal [2016] 3 MLJ 797 Euggine Kausai v Yapidmas Plantation Sdn Bhd & Ors [2020] MLJU 1001 Global Ventures Network Sdn Bhd v Lokman bin Dato’ Mohd Kamal and another appeal [2018] 6 MLJ 103 Globe Engineering Sdn Bhd v Bina Jati Sdn Bhd [2014] 5 MLJ 145 Goh Ah Yew v Public Prosecutor [1949] 1 MLJ 150 Goh Bak Ming v. Yeoh Eng Kong & Other Appeals [2019] 1 CLJ 461 Good View Property Sdn Bhd v Standard Chartered Bank (M) Bhd [2015] 1 MLJ 99 Hamzah bin Abdul Majid v Mohd Jalani bin Datuk Hj Mohd Sidek & Ors [2014] MLJU 1858 HT Maltec Consultants v Malaysian Resources Corporation Bhd & Ors [2015] MLJU 2383 JNA lkhtisas Sdn Bhd v Kerajaan Malaysia [2015] 3 CLJ 1100 Keruntum Sdn Bhd v The Director of Forests & Ors [2017] 3 MLJ 281 Khalek Awang & Anor v. Koperasi Perumahan Kluang Bhd & Another Appeal [2021] 10 CLJ 238 Khoo Teng Chye v Cekal Berjasa Sdn Bhd & Anor [2015] MLJU 992 Koperasi Permodalan Felda Malaysia Bhd v Icon City Development Sdn Bhd (formerly known as ‘Sierra Peninsular Development Sdn Bhd’) & Anor [2023] 2 MLJ 338 Lim Boon San v Public Prosecutor [1968] 2 MLJ 45 Ling Peek Hoe & Anor v. Ding Siew Ching & Another Appeal [2017] 7 CLJ 641 Mahadeva Krisanon v. Teja Singh [2011] 1 CLJ 1016 Malaysia National Insurance Sdn Bhd v Malaysia Rubber Development Corporation [1986] 2 MLJ 124 Masyitah bt Md Hassan v Sakinah bt Sulong [2021] 7 MLJ 144 Mohamed Bin Kasdi v Public Prosecutor [1969] 1 MLJ 135 Nowran Begam Mohamed Saliff v Nantha Kumar Devar Sangaran & Anor; CTRM Aviation Sdn Bhd (Third Party) [2016] 7 CLJ 760 Omega Securities Sdn Bhd v Kok Fook Loy [2010] 9 MLJ 224 Pacific & Orient Insurance Co Bhd v Mohammad Hafizi bin Bahari & Anor [2023] 11 MLJ 933 Parkwood Palms Sdn Bhd v Pemungut Duti Setem [2021] MLJU 1332 PP v Mohd Razali Zakariya [2018] 4 CLJ 438 Renault SA v Inokom Corp [2010] 5 MLJ 394 Repco (M) Sdn Bhd v Tan Toh Fatt & Ors [2013] 7 MLJ 408 Sabah Shell Petroleum Co Ltd & Anor v The Owners of and/or Any Other Persons Interested in the Ship or Vessel the ' Borcos Takdir' [2012] 5 MLJ 515 SCK Group Bhd & Anor v Sunny Liew Siew Pang & Anor [2011] 4 MLJ 393 Shell (M) Trading Sdn Bhd v Tan Bee Leh @ Tan Yue Khoen & Ors [2013] 8 MLJ 533 Sinnaiyah & Sons Sdn Bhd v Damai Setia Sdn Bhd [2015] 5 MLJ 1; [2015] 7 CLJ 584 Subry bin Hamid v Husaini bin Tan Sri Ikhwan & Anor [2006] 6 MLJ 229 Sun Holding (Sun Park Hotel) Co Ltd & Ors v Export-Import Bank of Malaysia Bhd [2016] 1 MLJ 115 Sykt Pembinaan Anggerik Sdn Bhd v Malaysia Airports Holdings Bhd [2022] 9 MLJ 391 Tan Chang Yong Holdings Sdn Bhd v Corporate Sunrise Sdn Bhd [2017] MLJU 1734 Tekital Sdn Bhd v Sarina bt Kamaludin & Ors [2012] 8 MLJ 734 Tindok Besar Estate Sdn Bhd v Tinjar Company [1972] 2 MLJ 229 Tiow Weng Theong v Melawangi Sdn Bhd [2018] 6 MLJ 761 Usima Sdn Bhd v Lee Hor Fong (trading under the name and style of Pembinaan LH Fong) [2017] 5 MLJ 273 Legislation: Evidence Act 1950, ss 10, 60, 92, 101, 102, 103 & 114(g) Partnership Act 1961, s 11 Other sources referred to: Lim Chong Fong, Law and Practice of Construction Law in Malaysia, Sweet & Maxwell, 2021