Pembinaan Mitrajaya Sdn Bhd v Mrcb Builders Sdn Bhd (WA-24C-102-07/2021)

the application by MRCB Builders Sdn Bhd (‘MBSB’) pursuant to s 15(b), (c) and/ or (d) of the Construction Industry Payment and Adjudication Act 2012 [Act 746] (‘CIPAA’) in Originating Summons No. WA-24C-91-07/2021 (‘O.S. No. 91’) to set aside the Adjudication Decision dated 18.5.2021 (‘AD’) by the learned Adjudicator, Mr. Sivabalan Subramaniam (‘Adjudicator’) or S/N xh8T7sFBYkuCRUzm7qyz1w alternatively, to stay the AD pursuant to 16(1)(b) CIPAA pending the final determination by arbitration to be commenced by MBSB (‘Setting Aside/ Stay Application’); and

the application Pembinaan Mitrajaya Sdn Bhd (‘Mitrajaya’)

MBSB’s O.S. dated 8.7.2021 (encl. 1);

MBSB’s Affidavit In Support (‘AIS’) affirmed by its Director, Lok Ngai Hey on 28.7.2021 (encls. 15 - 25);

Mitrajaya’s Affidavit In Reply (‘AIR’) affirmed by its Project Director, Yap Yoon Cheong on 11.8.2021 (encl. 26); and

Mitrajaya’s AIR affirmed by the same deponent on 24.8.2021 (encl. 27). S/N xh8T7sFBYkuCRUzm7qyz1w

Mitrajaya’s O.S. dated 13.7.2021 (encl. 1);

Mitrajaya’s AIS affirmed by the same deponent on 12.7.2021 (encl. 2);

MBSB’s AIR affirmed by the same deponent on 11.8.2021 (encl. 3); and

Mitrajaya’s AIR affirmed by the same deponent on 25.8.2021 (encl. 4). Background Facts [5] MBSB is a private limited company incorporated in Malaysia under the Companies Act 1965 [Act 125] with its business address at Level 30, Menara Allianz Sentral, No. 203, Jalan Tun Sambanthan, Kuala S/N xh8T7sFBYkuCRUzm7qyz1w Lumpur Sentral, 50470 Kuala Lumpur. Its nature of business is to build, develop and manage residential complexes, commercial spaces and industrial hubs as well as providing investment opportunities in urban properties. [6] Mitrajaya is similarly a private limited company incorporated in Malaysia under Act 125 with its business address at No. 9, Block D, Pusat Perdagangan Puchong Prima, Persiaran Prima Utama, Taman Puchong Prima, 47150 Puchong, Selangor. Mitrajaya’s nature of business is in civil engineering, building and road construction works, supply of construction materials and property development. [7] MBSB is the main contractor for a project known as “Proposed Mixed Development of Phase 1A, Phase 1C & Phase 1F consisting of 1 Block 27-Storey Office Tower (Tower 3), 1 Block Office Tower (Tower 5), 1 Block 25-Storey Office Tower (Tower 6), 1 Block Office Tower (Tower 2), 1 Block Office Tower (Tower 1), 1 Storey Service Level, 4-Storey of Basement Car Park and Central Utility Building (CUB) on Lot 12, S/N xh8T7sFBYkuCRUzm7qyz1w Persiaran Barat, Section 52, Bandar Petaling Jaya, Petaling District, Selangor Darul Ehsan for Messrs. P.J Sentral Development Sdn Bhd”. [8] By the Letter of Award (‘LoA’) dated 24.10.2016, MBSB awarded Mitrajaya with the Works Package Contract for the “Superstructure Works for Tower 3” (‘Project’) at the above-mentioned project site for the contract sum of RM73,306,000.00 inclusive of 6% Goods and Services Tax. [9] Sub-Clause 1.12 of the LoA provides that the conditions of contract from the PWD Standard Form of Conditions of Contract (PWD Form 203A-Rev. 1/2010) (‘CoC’) and all the Addendums to the CoC will apply to the Works Package Contract. [10] Sub-Clause 2.1 of the LoA stipulates that the LoA shall form part of the Contract Documents. [11] A Supplementary Letter of Award dated 22.8.2017 (‘Supplementary LoA’) was entered into by the parties to amend Clause 4.1 of the LoA S/N xh8T7sFBYkuCRUzm7qyz1w where the date of commencement of the superstructure works for Tower 3 is 15.2.2017 with the completion period of 14 months and the date of completion is 19.4.2018. The works shall be considered as complete upon the issuance of the Certificate of Practical Completion (‘CPC’) pursuant to sub-Clause 4.4. [12] According to sub-Clause 4.3 of the LoA, the Liquidated and Ascertained Damages (‘LAD’) if the CPC is issued after the date for completion is RM30,000.00 per calendar day. [13] Disputes arose between the parties which led Mitrajaya to issue a Payment Claim dated 10.12.2020 pursuant to s 5 CIPAA for payment in the total sum of RM1,985,994.33 in respect of Interim Payment Certificate (‘IPC’) Nos. 38, 39, 41 and 44 and the uncertified sum of RM231,995.95 under IPC No. 44. [14] MBSB issued a Payment Response dated 24.12.2020 to deny Mitrajaya’s claim on the grounds that – S/N xh8T7sFBYkuCRUzm7qyz1w

the Superintending Officer (‘SO’) had issued the Certificate of Non-Completion on 14.2.2019 (‘Initial CNC’) certifying that the works ought to have been completed by 13.6.2018 after granting 55 days of extension of time (‘EoT’) for Mitrajaya’s EoT Applications Nos. 2, 3 and 4;

the works had reached a stage capable of partial occupation as of 15.11.2019 as certified by the SO via the Certificate of Partial Occupation dated 11.3.2020;

the SO had issued the CPC dated 11.3.2020 certifying that the works reached practical completion on 26.12.2019;

following the Initial CNC, Mitrajaya had submitted a series of EoT applications and eventually, the SO issued a final EoT determination on 23.12.2020 granting 303 days of EoT and thus, extending the completion date of the Project to 14.2.2019. On 23.12.2020, the SO also issued a Revised CNC certifying that the works ought to be completed by 14.2.2019; S/N xh8T7sFBYkuCRUzm7qyz1w

MBSB is entitled to deduct and/ or set-off a sum of RM6,516,813.79 as LAD and this would extinguish the whole of Mitrajaya’s claim; and

alternatively, MBSB shall seek the appointed adjudicator to assess the quantum of LAD and/ or general damages as a counterclaim. [15] On 29.12.2020, MBSB gave notice to Mitrajaya to refer the dispute arising from the Payment Claim and the Payment Response to adjudication pursuant to ss 7 and 8 CIPAA. This was followed with MBSB’s Adjudication Claim dated 1.3.2021, Mitrajaya’s Adjudication Response dated 15.3.2021, MBSB’s Adjudication Reply dated 22.3.2021 and Mitrajaya’s Rejoinder to Adjudication Reply dated 29.3.2021. [16] In para M of the AD on “DETERMINATION”, the Adjudicator decided as follows: S/N xh8T7sFBYkuCRUzm7qyz1w “1. Based on my findings in section K ('FINDINGS AND REASONS') above, the Adjudication Response is successful in part and I hereby direct the Claimant to pay the Respondent the following:

RM1,753,998.38, i.e. the Certified Component of Payment Claim Sum; and

RM49,616.04, i.e. part of the Uncertified Component of Payment Claim Sum.

2.

3.

In summary, the Claimant shall pay the Respondent a sum of RM1,911,306.87 (=RM1,753,998.38+ RM49,616.04+RM75,042.45+RM17,650.00+RM15,000 .00) by remitting the said amount to the Claimant's authorised bank account no later than 08 Jun 2021. S/N xh8T7sFBYkuCRUzm7qyz1w

In the advance payment security (items 6 and 7 of Table-8) there was a cost component of RM179.20 allocated for the estimated expenses of the adjudicator. I have drawn a sum of RM168.90 for my expenses from the above allocation, which leaves a residual sum of RM10.30. This residual sum is to be refunded by AIAC to the Claimant.”. [17] Subsequently, MBSB commenced arbitration proceedings against Mitrajaya vide the Notice of Arbitration dated 20.8.2021. I. O.S No. 91: The Setting Aside Application [18] MBSB’s application to set aside the AD was made pursuant to limbs

(b), (c) and/ or (d) of s 15 of the CIPAA which reads: “Improperly Procured Adjudication Decision

An aggrieved party may apply to the High Court to set aside an adjudication decision on one or more of the following grounds: S/N xh8T7sFBYkuCRUzm7qyz1w …

there has been a denial of natural justice;

the adjudicator has not acted independently or impartially; or

the adjudicator has acted in excess of his jurisdiction.”. [19] The grounds of the application as stated in O.S. No. 91 are as follows:

There is denial of natural justice when the Adjudicator –

failed to afford the parties with the opportunity to address the Adjudicator on the issue of MBSB’s purported waiver of the non-compliance by Mitrajaya with the condition precedent to Mitrajaya’s applications for EoT;

(ii) failed to afford MBSB with the opportunity to address the Adjudicator on the issuance and service of the CNC dated 14.2.2019; and/ or S/N xh8T7sFBYkuCRUzm7qyz1w

(iii) failed to consider the powers vested in the Adjudicator under s 25(m) and/ or (n) of the CIPAA as submitted by MBSB in respect of the CNCs issued, the determination of Mitrajaya’s applications for EoT and the LAD claimed.

The Adjudicator failed to act impartially and/ or acted in breach of the rules of natural justice when he –

failed to decide on the issue of the SO’s assessment of Mitrajaya’s applications for EoT in accordance with the terms of the contract; and/ or

(ii) failed to afford MBSB with an opportunity to file a Surrejoinder.

If any of the aforementioned failures had not taken place, the Adjudicator may have arrived at a different conclusion. S/N xh8T7sFBYkuCRUzm7qyz1w

The Adjudicator acted in excess of his jurisdiction when he awarded Mitrajaya interest which was not claimed in its Payment Claim. 1st Issue: Whether the Adjudicator went on a frolic on his own when deciding on the issue of waiver and thereby breached the rule of natural justice and/ or acted in excess of his jurisdiction [20] One of the main issues which was considered by the Adjudicator was whether MBSB is entitled to the LAD sum and therefore entitled to set-off this amount against the payment due to Mitrajaya. The first related sub-issue was whether Mitrajaya had complied with the condition precedent in the contract with respect to its EoT submissions, and if not, whether it has been waived by MBSB. [21] Mitrajaya had submitted nine EoT applications, namely, EoT Application Nos. 5 to 13 between 7.3.2018 to 17.1.2020. In this regard, S/N xh8T7sFBYkuCRUzm7qyz1w Clause 43.0 CoC on “DELAY AND EXTENSION OF TIME” provides that: “43.1 Upon it becoming reasonably apparent that the progress of the Works is delayed, the Contractor shall forthwith give written notice to the S.O as to the causes of delay and relevant information with supporting documents enabling the said officer to form an opinion as to the cause and calculation of the length of delay. If in the opinion of the S.O the completion of the Works is likely to be delayed or has been delayed beyond the Date for Completion stated in Appendix 1 or beyond any extended Date for Completion previously fixed under this Clause due to any or more of the following events: …”. [22] In the adjudication, MBSB drew support from the case of KL Eco City Sdn Bhd v. Tuck Sin Engineering & Construction Sdn Bhd & anor [2020] AMEJ 1852 in taking the position that, before the EoT applications can be considered, Mitrajaya must first comply with the mandatory requirements of giving a written notice within 30 days upon it becoming “reasonably apparent that the progress of the Works is S/N xh8T7sFBYkuCRUzm7qyz1w delayed’ and that the notice must include “relevant information with supporting documents”. [23] The Adjudicator had found that such requirement is mandatory as can be seen in para K: 2a(6)(a) at pp 80 - 81 of the AD when he said: “I have examined the material clauses pertaining to service of notice with respect to EOT claims, viz. clauses 43.1 and 43.2 of the Conditions of Contract. … When the above clauses are read and construed together, I find that the wording thereof is clear and unambiguous with regards the requirement to give notice within 30 days on occurrence of a relevant event in order for the Respondent to be entitled to an EOT, i.e. the requirement is mandatory as opposed to being merely directory. Furthermore, not only is the Respondent required to give notice within 30 days, it is also to provide sufficient information and supporting information with respect to cause(s) of delay, the details of the delay on the work programme, the estimated length of delay etc. In order for the SO to form an opinion, undertake a proper assessment and decide on the EOT application.”. S/N xh8T7sFBYkuCRUzm7qyz1w [24] The Adjudicator additionally found that only four out of the total nine EoT Applications had complied with the 30-day notice requirement and “Although all of these applications were preceded with notices that predates the formal application itself as correctly pointed out by the Respondent, the same do not seemed to have satisfied the requirements spelled out in the above clauses as regards to providing the adequate documentations and relevant information.”. Notwithstanding these findings, the Adjudicator agreed with Mitrajaya that: “(6) … …

… there has been no documents adduced before me that suggests that the SO intended to construe the notice requirement strictly. Furthermore, the SO had sought further and better particulars from the Respondent with regards the EOT Application and thereafter proceeded with the deliberation, assessment and determining the EOT entitlement.

The Respondent sought refuge by citing decisions from Syarikat Tan Kim Beng and Top Speed S/N xh8T7sFBYkuCRUzm7qyz1w which the Claimant denies as being relevant and instead relies on the decision in KL Eco City Sdn Bhd. I have reviewed the decision in KL Eco City Sdn Bhd, it being the most recent of cases. I agree with the Claimant’s submission that in KL Eco City Sdn Bhd, it was held that a contract administrator is an agent of the employer and consequently the contract administrator has no right to waive a condition precedent notice requirement under the subsisting contract, unless such authority has been conferred to the same. Following from this, the Claimant is of the view that even if the SO in this proceeding, seemed to have disregarded the strict requirement of the condition precedent by the SO’s conduct, it matters not as the SO has no right to waive such a requirement, as only the employer does. The Claimant ventures further and suggests that it reserves the right to reject the SO’s EOT determination and accordingly increase the sum as its LAD claim based on the SO’s confirmation that the Respondent had failed to comply with the condition precedent notice requirement.

I agree with the Claimant that the SO has no right to waive the condition precedent, only the Claimant can do so; however, I find that the S/N xh8T7sFBYkuCRUzm7qyz1w Claimant’s suggestion that it reserves its right to reject the SO’s EOT determination is not without difficulty.

The Claimant in the payment response and in this proceeding had sought to levy LAD as well as to set-off the LAD Claim Sum against the Payment Claim Sum based on the EOT determination by the SO. By doing so, I take the view that the Claimant has accepted and ratified the SO’s grant of EOT. In view of the foregoing, the Claimant must be deemed to have waived the non fulfilment of the condition precedent with regard to the EOT and I so find and hold accordingly.

Consolidating and summarising, I take the view that the whilst the Respondent did not fully comply with the condition precedent requirement under clause 43.1 of the Conditions of Contract, however the Claimant is deemed to have waived this non fulfillment.” (emphasis added). [25] MBSB argued that there has been a denial of natural justice and/ or the Adjudicator had exceeded his jurisdiction when he concluded that S/N xh8T7sFBYkuCRUzm7qyz1w MBSB is deemed to have waived Mitrajaya’s non-fulfilment of the condition precedent simply because MBSB had sought to levy LAD based on the EoT determination by the SO. The Adjudicator arrived at this finding without granting the opportunity to MBSB to address the “crucial and decisive” issue of “considerable importance” which was conceived by the Adjudicator himself and thereby rendering the AD liable to be set aside. The decisions in Genting Malaysia Berhad v. PLM Interiors Sdn Bhd [2020] 1 LNS 218 and Kining Exeton Sdn Bhd v. Majlis Perbandaran Kuantan & another case [2020] 1 LNS 1066 were cited in support of this argument. [26] It was further submitted that, had the Adjudicator referred this issue to the parties, there is a “real possibility” that he may have arrived at a different conclusion as MBSB could have shown that the issue is in fact a non-starter. This is because MBSB’s conduct in levying the LAD based on the EoT determination by the SO could not in law constitute a waiver of Mitrajaya’s non-compliance in the light of – S/N xh8T7sFBYkuCRUzm7qyz1w

Clause 30 of the LoA and Clause 74.0 of the CoC on “WAIVER” which basically provide that the failure by any party to enforce any provision shall not be construed as a waiver of its right to enforce the breach of such provision; and

Clause 70.0 of the CoC on “AMENDMENT” which provides that no modification, amendment or waiver of any of the provisions of the contract shall be effective unless made by mutual consent and made in writing by way of supplementary agreement. [27] I begin my analysis by referring to s 24(c) of the CIPAA which sets out one of the duties and obligations of the adjudicator which is to comply with the principles of natural justice. In the context of s 15(b) CIPAA, these principles relate to the second pillar or rule that the parties must be given adequate notice and the opportunity to be heard before a decision is made (see the guidelines as expounded in Cantillon Ltd v. Urvasco Ltd [2008] EWHC 282 (TCC) and applied in numerous cases decided by the courts in Malaysia such as ACFM Engineering & Construction Sdn Bhd v Esstar Vision Sdn Bhd and another appeal [2016] MLJU 1776, Ranhill E & C Sdn Bhd v Tioxide (M) Sdn Bhd and S/N xh8T7sFBYkuCRUzm7qyz1w other appeals [2015] MLJU 1873, Hiform (M) Sdn Bhd v TSR Bina Sdn Bhd & Another Case [2020] MLRHU 588). [28] As for MBSB’s ground to set aside the AD which is premised on s 15(d) CIPAA, sub-s 27(1) and (2) of the CIPAA provides that: “Jurisdiction of adjudicator

27.

Subject to subsection (2), the adjudicator's jurisdiction in relation to any dispute is limited to the matter referred to adjudication by the parties pursuant to sections 5 and 6.

The parties to adjudication may at any time by agreement in writing extend the jurisdiction of the adjudicator to decide on any other matter not referred to the adjudicator pursuant to sections 5 and 6. …”. In this case, there is clearly no written agreement by the parties within the meaning of sub-s 27(2) as quoted above. S/N xh8T7sFBYkuCRUzm7qyz1w [29] As I understand it, the type of excess of jurisdiction argument brought by MBSB would fall within “contingent jurisdiction” where the existence of valid jurisdiction is dependent on further compliance with the requirements of the CIPAA i.e. the dispute must be one falling within the matter referred to adjudication (see Terminal Perintis Sdn Bhd v Tan Ngee Hong Construction Sdn Bhd and another case [2017] MLJU 242 and View Esteem Sdn Bhd v. Bina Puri Holdings Bhd [2019] 5 CLJ 479). [30] A perusal of the Adjudication Response reveals that one of Mitrajaya’s grounds of rebuttal is against MBSB’s submission that Mitrajaya has failed to fulfil the requirement on the giving of notices of EoT pursuant to Clause 43.1 CoC (see paras 46 to 53 wherein para 53, Mitrajaya stated that “Three important points are worth reiterating, namely:

53.1 Every EOT application by the Unpaid Party was in fact preceded by a notice for the same that pre-dates the formal EOT application, as the events were ongoing events. These prior notices were all referred to in the formal EOT applications. S/N xh8T7sFBYkuCRUzm7qyz1w

53.2 There is no contemporaneous document of any sort whereby the Non-Paying Party indicated that it was either not aware of the delay events and/or that it intended to strictly construe the notice requirement.

53.3 The fact that the Non-Paying Party proceeded to deliberate on the EOT applications, albeit in a self-serving manner after Payment Claim was issued, clearly shows that there was no intention by the Non-Paying Party at any point in time to insist upon the notice requirement as a strict and mandatory condition precedent.”). [31] In the Adjudication Reply, MBSB admitted paras 46 to 49 of the Adjudication Response in so far as the SO had considered the EoT Application Nos. 5 to 13. Pertinently, MBSB denied paras 51 to 53 of the Adjudication Reply and said: “62. … The Respondent is clearly misconceived on the application of a "condition precedent" notice requirement in respect of delay and loss & expense claim contained in construction contracts. The question of the S.O.'s authority to grant EOT when the condition precedent notice requirement is not met do not relates to what the S.O. knew in respect of the facts, it is a S/N xh8T7sFBYkuCRUzm7qyz1w question of whether the right to receiving the condition precedence notice is waived.”. [32] MBSB then relied on KL Eco City (supra) in submitting that “… it matters not what the S.O. knew or did not know in respect of the delay events, the S.O. is not in a position to waive the Claimant's right to a condition precedent notice, and in turn the S.O.’s EOT determination is void unless the Claimant had given consent to the S.O. in waiving his right to a condition precedent notice, and in turn the Claimant is entitled to deduct LAD, as though the EOT was never granted by the S.O.”. [33] Based on the brief discussion of the adjudication papers, it is plain to see that the issue of waiver was raised in the Adjudication Response and MBSB responded to the same in the Adjudication Reply. The Adjudicator made his decision after considering all submissions by the parties and in the circumstances of this case, there is no necessity for the Adjudicator to draw the attention of the parties to the matter and to give them the opportunity to address the issue. The decision of this Court in Kining Exeton (supra) can be distinguished as in that case, S/N xh8T7sFBYkuCRUzm7qyz1w the decisive issue of time at large, on which the adjudicator had dismissed the cross-claim for LAD, was not expressly pleaded, submitted or dealt with by either party in the adjudication proceedings. [34] Even if the Adjudicator had misconstrued the submissions of the parties and/ or came to a wrong conclusion on the issue of waiver, these are not valid reasons to set aside the AD under limbs (b) and/ or

of s 15 CIPAA. 2nd Issue: Whether the Adjudicator acted in breach of the rules if natural justice and/ or failed to act impartially by re-writing the terms of the agreement [35] Without prejudice to the 1st Issue, MBSB contended that the Adjudicator had breached the first pillar or rule of natural justice in that he was bias. It was alleged that the Adjudicator had also failed in his duty to be impartial by rewriting Cause 43.0 of the CoC in favour of Mitrajaya when he imposed a time limit for the SO to provide his S/N xh8T7sFBYkuCRUzm7qyz1w determination on the EoT applications contrary to the agreement of the parties. [36] Specifically, MBSB was disgruntled at the decision in para K: 2c(5)(m) of the AD which reads: “Notwithstanding the foregoing, there appears to be protracted delay on the part of the SO in eliciting additional documents and seeking clarification from the Respondent; this is evident from the fact that the first of several clarifications and additional documents was only submitted by the Respondent on 15 May 2019 (for EOT applications #5 through #9) some 14 months of so after EOT application #5 was submitted and thereafter several more submissions ensued from the Respondent with the last submission being made by the same on 16 Jun 2020. I agree with the Respondent that the first MCO imposed by the Government on 18 Mar 2020 did not have any significant bearing on the SO’s ability to assess the EOT Applications timeously and promptly as these applications were made well before the above the foregoing date. Even if the assessment of the EOTS extended into the MCO period as in this instant case, approval from the local authorities to visit the Project site could S/N xh8T7sFBYkuCRUzm7qyz1w have been sought in order to access site records and other contemporaneous documents stored thereat.” [37] Apart from para (c) in s 24 CIPAA which was alluded to previously, paras (b) and (d) of the same provision provide that an adjudicator shall act independently, impartially and in a timely manner and that there are no circumstances likely to give rise to justifiable doubts as to the adjudicator’s impartiality and independence. [38] For purposes of limb (c) of s 15 CIPAA, MBSB submitted that the applicable test is the “real possibility” test in that a “fair minded and informed observer” would conclude that there is a “real possibility” that the Adjudicator was partial to Mitrajaya and biased against MBSB. It was additionally submitted, on the authority of Itramas Technology Sdn Bhd v. Savelite Engineering Sdn Bhd and other cases [2021] MLJU 1382, that an adjudicator must treat both parties “equally and fairly” and the High Court in that case had set aside the adjudication decision because the adjudicator had breached the duty to be impartial by simply giving one party “an additional day” compared to the other party to respond to the adjudicator’s order. S/N xh8T7sFBYkuCRUzm7qyz1w [39] In the instant case, the complaint is that, despite finding that Mitrajaya had failed to comply with the mandatory requirements under Clause 43.0 CoC, the Adjudicator sought to exonerate Mitrajaya for the same by faulting the SO for the “protracted delay … in eliciting additional documents and seeking clarification” from Mitrajaya although Clause 43.0 does not impose a time limit on the SO. This eventually resulted in a finding that time for Mitrajaya to complete the works had been rendered at large and MBSB therefore could not claim for LAD. [40] The learned counsel for MBSB cited the case of Richallenge Corp Sdn Bhd v. Poteck Enterprise Sdn Bhd [2020] 3 MLJ 704 for the proposition that the Adjudicator cannot rewrite or improve on the terms between the parties “however desirable the improvement might be”. [41] In my considered view, MBSB has not proven that there is a denial of natural justice as the Adjudicator was bias and/ or that he had acted partially to aid Mitrajaya by “re-writing” the terms of the agreement between the parties in respect of the issue on Clause 43.0 of the CoC. S/N xh8T7sFBYkuCRUzm7qyz1w [42] MR. KH Chan had drawn the attention of the Court to the following part of Clause 43.0 CoC where, after the delay events are set out in that Clause, it is stated that – “then the S.O. may if he is of the opinion that the extension of time should be granted, so soon as he is able to estimate the length of delay beyond the date or time aforesaid issue a Certificate of Delay and Extension of Time giving a fair reasonable extension of time for completion of the Works.”. [43] The learned counsel submitted that the words “so soon as” in the above excerpt requires the SO to act forthwith. [44] In the book “The Malaysian PWD Form Of Construction Contract”, Second Edition, Sweet & Maxwell Asia, 2011, Lim Chong Fong J, in discussing Clause 43.0 of the PWD Form of Contract, explicated at p 103 that, in making an objective assessment of the application for EoT, the Officer Named must – “… do this as soon as he is able to estimate the length of the delay and no time limit is specified. S/N xh8T7sFBYkuCRUzm7qyz1w Nonetheless, it is submitted that the views of Roper J in the New Zealand case of Fernbrook Trading Co Ltd v Taggart [1979] 1 NZLR 556 are of assistance. The learned judge said: I think it must be implicit in the normal extension of time clause that the contractor is to be informed of his new completion date as soon as reasonably practicable. …” (emphasis added). [45] Further reference may be made to another textbook, “Construction Law in Malaysia”, Sweet & Maxwell Asia, 2012 by Datuk Sundra Rajoo and Ir Harbans Singh KS, the learned authors opine at p 368, with my added emphasis, that “If no period is expressly provided (see clause 43.1 of the JKR Forms 203 and 203A (Rev 1/2010) and clause 49.1 of the PWD Form DB (Rev 1/2010), then the contract administrator must act within a reasonable time of the contractor’s application (see Lion Engineering Sdn Bhd v Pauchuan Development Sdn Bhd [1997] 4 AMR 3315). …”. S/N xh8T7sFBYkuCRUzm7qyz1w [46] Although MBSB is not wrong in contending that Clause 43.1 CoC is silent as to the time frame within which the SO must provide his determination on Mitrajaya’s EoT applications, I am not convinced that the Adjudicator had given an interpretation of the said Clause in a way which a “fair minded and informed observer” would conclude that there is a “real possibility” that the Adjudicator was partial to Mitrajaya and biased against MBSB. [47] The Adjudicator had considered the submissions made by the parties and made a finding of fact as quoted in para 36 above. [48] In the upshot, it is well within the matters submitted by the parties in the adjudication proceedings for the Adjudicator to investigate as to whether the SO had acted within a reasonable time in assessing and deciding on the applications for EoT. In reality, MBSB is unhappy with the Adjudicator’s analysis and ultimate findings and conclusions, and this discontent is translated into a veiled attempt to set aside the AD on the grounds as stated in para 35 of this judgment. S/N xh8T7sFBYkuCRUzm7qyz1w 3rd Issue: Whether the Adjudicator breached the rules of natural justice and/ or failed to act impartially by allowing Mitrajaya to file a Rejoinder and denying MBSB the opportunity to file a Surrejoinder [49] At the outset, it is observed that in paras 48 to 50 of the AIS and in MBSB’s Written Submission (encl. 28), MBSB first attempts to have the AD set aside pursuant to limb (b) and/ or (c) of s 15 CIPAA as the Adjudicator is alleged to have failed to afford MBSB with the opportunity to file an application for leave to serve a Surrejoinder whereas he had allowed Mitrajaya to serve a Rejoinder without even hearing MBSB regarding this request. However, in the subsequent Written Submission In Reply and Brief Reply (encls. 32 and 37), MBSB seems to focus on the aspect of the purported unequal treatment of the parties and the Adjudicator having acted partially in favor of Mitrajaya i.e. limb (c) of s 15 CIPAA. [50] In the instant case, “a fair minded and informed observer” is said would conclude that there is a “real possibility” that the Adjudicator was partial to Mitrajaya when he – S/N xh8T7sFBYkuCRUzm7qyz1w

allowed Mitrajaya’s request immediately on the following working day without first hearing MBSB;

took six working days to respond to MBSB’s objection; and

denied MBSB the opportunity to put in a request to file a Surrejoinder and thereafter consider the grounds for the said request. [51] In deciding the 3rd Issue, the Court has scrutinised the correspondence in exhibits “LNH-9” to “LNH-12” in the AIS (encl. 25) and finds that –

in Mitrajaya’s solicitors’ letter dated 24.3.2021 to the Adjudicator, Mitrajaya requested “… for an opportunity to reply to the Adjudication Reply as it consists of new issues/ documents/ statutory declaration/ expert report and submissions of law not stated in the Adjudication Claim. This is all the more necessary bearing in mind that it is the Respondent who is the Unpaid Party and the Claimant seemed to have rushed to Issue the Notice of S/N xh8T7sFBYkuCRUzm7qyz1w Adjudication despite being the Non-Paying Party as a tactical manoeuvre, despite their only actual (disputed) claim being liquidated damages. …”;

the Adjudicator immediately replied to Mitrajaya’s solicitors’ and MBSB on 25.3.2021 stating, among others, that: “2. Taking into consideration the basis of the Respondent's request, pursuant to powers under Section 25 of the Construction Industry Payment and Adjudication Act 2012 ("CIPAA") together with my overriding duty as adjudicator to comply with the principles of natural justice, I would allow this request. The deadline for the Respondent to serve the aforesaid response on the Claimant with a copy to me is Mon, 5pm 29 Mar 2021.

Notwithstanding the granting of the above request, the Respondent must restrict and confine its response strictly to those matters that are new and were not previously pleaded by the Claimant in the Adjudication Claim, with S/N xh8T7sFBYkuCRUzm7qyz1w its submission being as concise and brief as possible.” (emphasis added);

MBSB conveyed its objection to Mitrajaya’s request vide the letter dated 26.3.2021. The relevant excerpt from the said letter is re-produced below: “… The Claimant submits it is trite that the CIPAA adjudication regime do not provide for a right to reply to the Adjudication Reply. The learned Adjudicator's attention is drawn to the recent Shah Alam High Court decision where Wong Kian Kheong J in MRCB Builders Sdn Bhd v. Wazam Ventures Sdn Bhd & another case [2020] 1 LNS 145 (HC) at para. [13], has taken a strong view that the CPAA Act does not give a right to the Respondent to file a rejoinder application. The learned Judge's decision was cited with approval in Ireka Engineering & Construction Sdn. Bhd v. Tri Pacific Engineering Sdn. Bhd. [2020] 1 LNS 387 (HC) at para. [26]. S/N xh8T7sFBYkuCRUzm7qyz1w Therefore, the Claimant respectfully submits the learned Adjudicator has no powers to allow for a request by the Respondent to submit a rejoinder to the Adjudication Reply, and therefore must dismiss the Respondent's application. In respect of the Claimant raising new issues, the Claimant submits an impartial review of the Adjudication Reply will show each and every paragraph in the Adjudication Reply was made in direct response to the Adjudication Response. The Respondent had raised numerous defences to Liquidated Damages, including the submission of authorities, surely the Claimant is entitled to reply to the same with authorities. … Accordingly we invite the learned Adjudicator to amend the direction of 25.03.2021. If the learned Adjudicator intends to ignore precedence and grant leave to the Respondent to submit a rejoinder, the Claimant reserve all rights, including an application to reply to the rejoinder. …” (emphasis added); S/N xh8T7sFBYkuCRUzm7qyz1w

Mitrajaya filed the Rejoinder on 29.3.2021;

six working days after MBSB’s letter as above mentioned i.e. on 5.4.2021, the Adjudicator replied, inter alia, that: “5. I have reviewed both of the cases cited by the Claimant. In the first case which is of greater relevance to the issue herein as it concerned the issue of whether the Adjudicator in that case had breached the second rule of natural justice under section 15(b) and section 24(c) of the CIPAA when the Adjudicator dismissed the Plaintiff's request for a rejoinder, the court there held that the Adjudicator did not. In arriving at this view, the said court held that "CIPAA does not provide a right for the respondent in an adjudication to file a Rejoinder". I am of the view the right referred to in the above relates to the enforceable or express right under the CIPAA. I had however granted leave to the Respondent to file its rejoinder by exercising the powers conferred on me under section 25 of the CIPAA and more particularly section 25(a) which is discretionary. Accordingly, I will not revoke my decision. S/N xh8T7sFBYkuCRUzm7qyz1w

I find that all of the issues raised in the Adjudication Claim, Adjudication Response, Adjudication Reply and the Rejoinder to Adjudication Reply have been encapsulated, raised and addressed within the above documents. I further find that there are no new issues that have been raised by the Respondent in its Rejoinder and even if there are, I will accordingly expunge them. I also find that it will not serve any useful purpose for any further pleadings to be served in response to the Rejoinder as it will likely to take these proceedings beyond the scope of the original adjudication proceedings where I then run the risk of acting in excess of my jurisdiction pursuant to section 27 of the CIPAA and moreover, it will confer no benefit to these proceedings. In view of the above, I therefore reject the request for the Claimant to reply to the Rejoinder, this again by exercising the powers conferred on me under section 25 of the CIPAA.” (emphasis added); and S/N xh8T7sFBYkuCRUzm7qyz1w

in the Order For Directions No. 1 dated 9.4.2021, the Adjudicator requested MBSB to provide its response to items 2, 3 and 4 in the table in para 9 of the Rejoinder. In the light of para 6 in the Adjudicator’s letter dated 5.4.2021, it would appear that the only response that was required by the Adjudicator pertains to the three specific items in the said table. Had the Adjudicator needed more responses than that, the Adjudicator would have said so in the Order For Directions No. 1. The Adjudicator had also earlier found that there are no new issues in Mitrajaya’s Rejoinder and even if there were, he would expunge them. In the circumstances, this Court is not convinced that, if the Adjudicator had allowed MBSB to put in a request to file a Surrejoinder and/ or allowed for such Surrejoinder to be submitted, there is a real possibility that the Adjudicator may have arrived at a different conclusion. In the AIS, MBSB did not allude to the facts that it would have submitted in the Surrejoinder and which, in all likelihood, would have made a difference in the outcome of the adjudication proceedings. S/N xh8T7sFBYkuCRUzm7qyz1w [52] Based on the foregoing considerations, this Court is minded to conclude that the Adjudicator acted within his powers to “establish the procedures in conducting the adjudication proceedings including limiting the submission of documents by the parties” (see s 25(a) CIPAA) and a case of denial of natural justice has not, on a balance of probabilities, been proven. [53] In so far as the ground of challenge premised on limb (c) of s 15 CIPAA is concerned, as the Adjudicator had explained why he allowed the Rejoinder and disallowed the Surrejoinder, the mere act of permitting the submission of one document and not consenting to the submission of another document does not, in the factual matrix of this case, fulfil the requirement of there being a “real possibility” that the Adjudicator had not acted independently or impartially. S/N xh8T7sFBYkuCRUzm7qyz1w 4th Issue: Whether there is a denial of natural justice when the Adjudicator went on a frolic of his own in determining that the Initial CNC had not been properly issued [54] In MBSB’s Payment Response and Adjudication Claim, MBSB took the position that the SO had issued the Initial CNC pursuant to Clause 4.3 of the LoA. This was refuted by Mitrajaya in the Adjudication Response (see paras 23 to 33) wherein Mitrajaya asserted that it never received the Initial CNC and that it is incumbent on MBSB to prove actual service of the CNC before LAD can be imposed. [55] As for the Revised CNC, Mitrajaya submitted that there cannot be a Revised CNC when there is no Initial CNC in the first place. Even if any LAD is to be imposed on Mitrajaya, it claimed that the duration for purposes of calculating the LAD would be from 23.12.2020, the date of the Revised CNC, however, by then CPC had already been issued. [56] In the Adjudication Reply (see paras 25 to 30), MBSB adverted to the Statutory Declaration (‘SD’) affirmed by its Senior Project Director as to how he hand delivered the Initial CNC to Mitrajaya’s Project Director S/N xh8T7sFBYkuCRUzm7qyz1w on 2.5.2019 but the latter refused to acknowledge receipt of the same. 12 days after the purported attempt to serve the Initial CNC, Mitrajaya hurriedly presented its EoT Application 9, which was 14 months after EoT Application 8. MBSB maintained that the issuance of the Initial CNC and Revised CNC are in accordance with Clause 40 of the CoC. [57] On 9.4.2021, the Adjudicator sent the Order for Directions No. 1 to the parties and posed the question to MBSB as follows: “2. …

To the Claimant

Following the event that transpired on 02 May 2019 as presented in the statutory declaration dated 19 Mar 2021 submitted as schedule 2 to the Adjudication Reply, were there any follow-up correspondences and/or documents relating to this matter, issued by the Claimant by way of letters, emails or minutes of meeting etc.? If so, please produce them.”. [58] MBSB prepared its Written Submission as per the Adjudicator’s Direction No. 1 on 15.4.2021 and appended an e-mail with a screen S/N xh8T7sFBYkuCRUzm7qyz1w capture of a Whatsapp communication between MBSB’s Senior Project Director and Mitrajaya’s Executive Director dated 14.5.2019. MBSB posited that the contents of this communication is significant because Mitrajaya was made aware of the fact that the lack of EoT applications by Mitrajaya resulted in the issuance of the Initial CNC; Mitrajaya did not contest the statements in the Whatsapp text and agreed to do the necessary to mitigate the effects of the CNC; and MBSB had complied with the contractual provisions to give Mitrajaya fair and reasonable opportunity to seek an EoT for the delays suffered. [59] On the issue of “Whether CNC-1 was Properly Issued by the Claimant”, the Adjudicator had considered the position taken by the parties as reflected in the Adjudication Claim, Adjudication Response and Adjudication Reply and he had inspected the Initial CNC, MBSB’s SD, Mitrajaya’s SD (see para K: 2b(6)(c) at pp 85 - 86 of the AD), the e-mail and the Whatsapp communication before making a finding of fact (at pp 87 - 89 of the AD) as follows: “2b. …

… S/N xh8T7sFBYkuCRUzm7qyz1w

Following from the above, I am persuaded to form an opinion that on the balance of probabilities the meeting of 02 May 2019 did indeed occur. I do so because of the fact that: (i) Mr Cheong's SD of 19 Mar 2021 refers to another CNC which was apparently issued on 02 May 2019 (although the signed acknowledge receipt did not contain a date stamped on it) to another contractor under the Project. It is therefore not unreasonable to assume that a CNC may have been prepared for issuance to the Respondent on the same date; and (ii) the email from Mr Cheong to Ms Magdalene Soon dated 13 Apr 2021 makes explicit reference to the said meeting.

Notwithstanding the above, I take the view that CNC-1 was not issued by the Claimant to the Respondent for the following reasons:

firstly, there is no corroboration to show that CNC-1 was sought to be physically delivered to the site office of S/N xh8T7sFBYkuCRUzm7qyz1w the Respondent but such delivery was frustrated by the refusal to cooperate and to accept delivery after Mr Yap had refused to acknowledge receipt of the CNC "and left abruptly as recorded in the SD of Mr Cheong during their face-to-face meeting on 02 May 2019;

(ii) a second item of corroboration that I would require which is absent is contemporaneous meeting minutes held internally within the Claimant's management team or site meeting between the Parties recording this incident;

(iii) the third item of corroboration that I would require which is further absent is evidence of an alternative mode of delivery being attempted by the Claimant to effect such delivery through registered post, courier, facsimile, or by hand to the Respondent's business or registered address in accordance with clause S/N xh8T7sFBYkuCRUzm7qyz1w

26.1 of the LOA (clause 26.1 says: "All notices or other documents required to be given hereunder shall be in writing and shall be deemed to have been duly given if left at or sent by post, to a party at the address as provided herein below or such other address as may have been notified in writing from time to time by the addresses to the other party..."); or as pointed out by the Respondent by uploading the said document onto the 'team binder' software which was the agreed means of document exchange for the Contract Works.

A document which has such contractual significance such as a CNC, cannot be deemed to have been delivered merely on the basis that there was an intention to do by the Claimant or there was a discussion about it between senior project personnel of the Parties.

The WhatsApp communication between Mr Cheong and Mr Jha post 02 May 2019 S/N xh8T7sFBYkuCRUzm7qyz1w meeting and the email of Mr Cheong to Ms Magdalene Soon is not conclusive evidence that CNC-1 was issued by the Claimant to the Respondent.

If CNC-1 was indeed issued properly by any of the means prescribed above, it would be relatively straightforward for the Claimant to produce documentary evidence as proof of such delivery. Any reasonable adjudicator would expect a corroboration of this nature disjunctively.

In summary, I hold that CNC-1 was never issued by the Claimant to the Respondent.”. [60] MBSB grouse is with regards to the three “items of corroboration” that the Adjudicator required and found that MBSB had failed to provide (see para K: 2b(6)(j) as above quoted). It was submitted that, if the Adjudicator had informed, and allowed, MBSB to address these “highly specific items of corroboration”, MBSB would have been able to explain the circumstances surrounding the issuance and service of the Initial CNC to meet the expected corroboration required by the S/N xh8T7sFBYkuCRUzm7qyz1w Adjudicator. In such circumstances, there is a real possibility that the Adjudicator may have arrived at a different conclusion. [61] I have considered MBSB’s contention as aforesaid, however, I am unable to arrive at a conclusion as desired by MBSB for the following reasons:

It is clear from the Order for Directions No. 1 that the Adjudicator had given the opportunity to MBSB to provide any follow-up correspondences and/ or documents which were issued by MBSB after 2.5.2019 pertaining to the purported attempt to serve the Initial CNC to Mitrajaya. “Correspondences” would cover any communication by exchanging letters, e-mails or other messages whilst the word “document” is very wide. Where the word “document” is used in any written law, it is defined under s 3 of the Interpretation Acts 1948 And 1967 [Act 388] to mean “any matter expressed or described upon any substance by means of letters, figures or marks, or by more than S/N xh8T7sFBYkuCRUzm7qyz1w one of those means, intended to be used or which may be used for the purpose of recording that matter”. Even by referring to the dictionary meaning of “document”, it basically encompasses a paper or set of papers or electronic file conveying written or printed information about something or that is, or can be, used as evidence or proof of something (see the online Oxford, Cambridge, Britannica and Merriam-Webster dictionaries). The Adjudicator gave some examples of correspondences and documents by mentioning letters, e-mails or minutes of meeting and by using “etc.”, these examples are not exhaustive and further or similar correspondences and documents are included. Out of the three “items of corroboration” as required by the Adjudicator, contemporaneous minutes of meeting(s) or site meeting(s) falls within one of the examples in the Order for Directions No. 1 while the other two items would come within the meaning of “documents”. It is reasonable to expect that MBSB would know what correspondences and/ or documents that it S/N xh8T7sFBYkuCRUzm7qyz1w should produce to corroborate its version of the facts as affirmed in its SD. By issuing the Order For Directions No. 1 and framing para 2(1)(a) therein in the manner as he did, the Adjudicator has, in my view, accorded procedural fairness to MBSB. Surely it is not the role of the Adjudicator to particularise the correspondences and/ or documents that are necessary in order for MBSB to satisfactorily prove its case. As submitted by Mitrajaya’s counsel, MBSB cannot shift the burden on the Adjudicator to provide MBSB with an opportunity to explain for MBSB’s own failure to supply the appropriate or requisite documents.

The Adjudicator is given the power to ascertain facts under s 25(i) CIPAA and he has requested for further documents in the Order for Directions No.

In this regard, Mr. KH Chan has aptly chosen to rely on the following passage from the decision of the High Court in Maju Holdings Sdn Bhd v Spring Energy Sdn Bhd [2020] 1 LNS 1193: S/N xh8T7sFBYkuCRUzm7qyz1w “[35] Although there is a power accorded to the Adjudicator to inquisitorially take the initiative to ascertain facts in s. 25(i) of the CIPAA, this is merely a power but not a duty on him to do so. The adjudication proceedings under the CIPAA is plainly an adversarial dispute resolution process which requires the parties to satisfactorily prove their respective allegations with sufficient evidence. … [37] Consequently the Adjudicator may, in my view, seek clarification on the Adjudication Submissions made by parties. It is however not his duty to elucidate any further information from them after his receipt of their response if he is satisfied with the clarification given. Otherwise, this may result in prolonged exchanges between the parties and unnecessarily impinging upon the limited time available to the Adjudicator to make the Decision within the statutory time frame.”. [62] In closing, MBSB’s own failure to produce the necessary evidence to corroborate the alleged service of the Initial CNC to Mitrajaya is not a ground to set aside the AD pursuant to s 15(b) CIPAA. S/N xh8T7sFBYkuCRUzm7qyz1w 5th Issue: Whether there is a denial of natural justice when the Adjudicator declined to consider his powers under s 25 (m) and/ or (n) of the CIPAA [63] The next and final argument by MBSB on denial of natural justice was as to the Adjudicator’s failure to consider the exercise of his powers pursuant to s 25(m) and/ or 25(n) of the CIPAA despite MBSB’s extensive submission on the same. These two paras in the CIPAA relate to the powers of the Adjudicator to – “(m) review and revise any certificate issued or to be issued pursuant to a construction work contract, decision, instruction, opinion or valuation of the parties or contract administrator relevant to the dispute;

decide or declare on any matter notwithstanding no certificate has been issued in respect of the matter;”. [64] In the Adjudication Response, Mitrajaya defended itself against MBSB’s claims by submitting, apart from the non-service of the Initial CNC, that – S/N xh8T7sFBYkuCRUzm7qyz1w

on the authority of Top Speed Holding Sdn Bhd v. Conlay Construction Sdn Bhd [2011] 1 LNS 238 and Kerajaan Malaysia v. Ven-Coal Resources Sdn Bhd [2014] 5 CLJ 186, time has been rendered at large because MBSB did not assess Mitrajaya’s applications for EoT. MBSB has thus lost its right to LAD;

MBSB’s excuse that the non-assessment of the EoT Applications was due to the 1st Movement Control Order (‘MCO’) imposed by the Government to combat the Covid-19 pandemic on 18.3.2020 is a lie as the date of the EoT Applications Nos. 5 to 13 were well before the 1st MCO;

the Revised CNC is invalid; and

the SO’s determination of the EoT Applications is wrong. [65] MBSB countered the above submissions by relying on s 25(m) and/ or

CIPAA and cases such as SKS Pavillion Sdn Bhd v Tasoon S/N xh8T7sFBYkuCRUzm7qyz1w Injection Pile Sdn Bhd [2018] 5 AMR 889, Asal Construction Sdn Bhd v Insan Makmur Sdn Bhd [2018] AMEJ 1263 and Bertam Development Sdn Bhd v R&C Cergas Teguh Sdn Bhd [2017] MLJU 1571 in inviting the Adjudicator to step into the shoes of the SO and “… to open up and correct or issue a CNC, a CPC or to revise or issue an EOT decision and in doing so, preserve the enforceability of ALL the contractual provisions …”. Time would then not be at large, and the Adjudicator would be in a position to decide on MBSB’s entitlement to LAD and the quantum (see paras 44 to 48 and 54 in the Adjudication Reply). [66] The Adjudicator’s analysis and findings on the issue of whether time has been rendered at large can be seen in para K: 2c(1) - (5) at pp 90 - 97 of the AD. [67] Citing the decision of the apex court in View Esteem (supra), MBSB’s grievance is that the Adjudicator purportedly failed to consider its defence with reference to the powers available to the Adjudicator under s 25(m) and (n) CIPAA, and in particular as to – S/N xh8T7sFBYkuCRUzm7qyz1w

the validity of the Revised CNC;

whether he is vested with the power to issue a CNC; and

whether the SO’s determination of the EoT applications was correct (hereinafter referred to collectively as the ‘Three Issues’), despite the Three Issues being raised in the adjudication, in breach of the rules of natural justice. [68] Firstly, with regards to the issue of the validity of the Revised CNC, the Adjudicator had dedicated para K: 2d(1) - (7) at pp 97 - 99 of the AD to consider this matter before concluding that: “(7) …

As I had held that time has been rendered at large in Item K:2c above, and the consequence of the foregoing is that the Claimant's right to levy LAD on the Respondent is no longer available to it, I take the view that it is not necessary for me to deal S/N xh8T7sFBYkuCRUzm7qyz1w with the issue of the validity of CNC-2 or otherwise as in either case (i.e. whether CNC-2 is valid or not), it will have no effect on my findings in Item K:2c above.”. [69] Similarly, in respect of the issues as to whether he is vested with the power to issue a CNC and whether the SO’s determination of the EoT applications was correct, the Adjudicator’s findings relate back to his determination that time has been rendered at large and as such, there is no necessity for him to deal with these two issues (see para K: 2e(3) and 2f(3) at pp 99 - 100 of the AD). It bears mention that the Adjudicator had specifically referred to s 25(m) and (n) of the CIPAA in para K: 2e(1) and (2) at p 99 of the AD. [70] In my opinion, this is not a case where the Adjudicator totally failed to consider the defences raised by MBSB, but rather one where the Adjudicator had taken cognizance of the submissions of the parties, including MBSB’s reliance on s 25(m) and (n) of the CIPAA (see pp 39, 45, 48, 53, 54, 59, 64 and 65 of the AD), and decided that it was not S/N xh8T7sFBYkuCRUzm7qyz1w necessary for him to deal with the Three Issues on the ground that he has already accepted Mitrajaya’s argument that time is at large. [71] Whilst a cursory glance of paras K: 2d(7)(a), 2e(3) and 2f(3) of the AD may give the impression as though the Adjudicator failed to consider the Three Issues, however, his justifications in finding that time has been rendered at large has to be appreciated. The Adjudicator’s reasons may be summed up as follows:

the dispute involves the granting of EoT retrospectively i.e. post-CPC. This does not, by itself, render the EoT invalid. Such granting of EoT has been held to be valid when it is expressly provided for in the contract or the circumstances are such that retrospective granting is inevitable;

Clause 43.0 of the CoC does not expressly permit the SO to grant EoT retrospectively. Hence, the Adjudicator went on to consider the nature of Mitrajaya’s EoT applications and the manner in which the EoT was granted by the SO; S/N xh8T7sFBYkuCRUzm7qyz1w

after having considered the EoT applications in question i.e. EoT Application Nos. 5 to 13, the Adjudicator found that –

the delay events in all applications, except for EoT Application Nos. 6, 7, 9 and 10, are independent or not related with one another;

(ii) all applications, except for EoT Application No. 13, were made before the issuance of the CPC;

(iii) as of EoT Application No. 6, Mitrajaya had referred to the preceding applications for EoT and considered them as being approved. Mitrajaya thus had added the additional number of days requested in the current application to the previous application(s) to derive the proposed new date for completion of the Project;

(iv) the SO made a final EoT determination one day before MBSB served its Payment Response; S/N xh8T7sFBYkuCRUzm7qyz1w

there is no requirement for the SO to review all the EoT applications together and to do it only after the CPC was issued;

(vi) there was adequate opportunity and sufficient time for the SO to review and assess each of the applications for EoT before the CPC was issued, except for EoT Application No. 13 which was submitted post-CPC;

(vii) there was protracted delay by the SO in eliciting additional documents and seeking clarification from Mitrajaya;

(viii) the 1st MCO did not have a significant bearing on the SO’s ability to assess the applications for EoT timeously and promptly;

(ix) as a result of the SO’s delay in assessing and deciding on the applications for EoT, the extended date for completion S/N xh8T7sFBYkuCRUzm7qyz1w of the project had lapsed without any new date for completion being fixed;

the circumstances of the case are not such that the retrospective granting of EoT is inevitable in the light of the way the SO handled the applications for EoT and the delay in the SO’s determination of the same; and

(xi) time has been rendered at large and therefore, MBSB has lost its right to enforce the LAD provision. [72] In view of the Adjudicator’s reasonings as set out above, it is perfectly valid for him to decline to address the Three Issues as these would not impact on the finding that time is at large in any way. [73] In the premises, there is no merit whatsoever in the 5th Issue which was raised by MBSB as a ground to set aside the AD under s 15(b) of the CIPAA. S/N xh8T7sFBYkuCRUzm7qyz1w 6th Issue: Whether the Adjudicator acted in excess of his jurisdiction in awarding pre-AD interest [74] In the Payment Claim, Mitrajaya did not expressly claim for interest on the claimed amounts as therein stated. However, in para 76 of the Adjudication Response, Mitrajaya did seek interest of 5% per annum to be paid. [75] MBSB’s complaint was with regards to para M(2) at p 102 of the AD where the Adjudicator directed MBSB to pay interest at the rate of 5% per annum beginning from 31.5.2020, 4.7.2020, 30.8.2020 and 27.11.2020 on the various IPC amounts and the admitted portion of the uncertified component of the sum claimed in the Payment Claim. All these dates are prior to the AD which was delivered on 18.5.2021. [76] MBSB relied on the decision in Naza Engineering & Construction Sdn Bhd v. SSL Dev Sdn Bhd [2020] 9 MLJ 499 in submitting that, by awarding the pre-AD interest even though Mitrajaya did not “plead” or claim for the same in the Payment Claim, the Adjudicator had acted in excess of his jurisdiction, and this warrants the setting aside of the AD. S/N xh8T7sFBYkuCRUzm7qyz1w This is thus another “contingent jurisdiction” argument for the determination of this Court. [77] Mitrajaya refuted MBSB’s contention by referring to s 25(o) of the CIPAA and the judgments in Milsonland Development Sdn Bhd v Macro Resources Sdn Bhd & Ors and another suit [2018] MLJU 1912 and SQA Builders Sdn Bhd v Luxor YRM Sdn Bhd and another appeal [2017] MLJU 2256 for the proposition that it is within the power of the Adjudicator to award pre-AD interest irrespective of whether such interest was “pleaded” or otherwise. Mr. KH Chan pointed out that interest was pleaded in the Adjudication Response. [78] The Adjudicator is granted wide powers under s 25 of the CIPAA and this includes the power under para (o) to award financing costs and interest. [79] Mr. KL Lam argued that Mitrajaya’s reliance on the case of Milsonland Development (supra) is misplaced as there no mention is made in that case as to whether the adjudicator would be acting in excess of his S/N xh8T7sFBYkuCRUzm7qyz1w jurisdiction if he awards pre-AD interest when it is not “pleaded” or “claimed for” in the payment claim. [80] The learned counsel further argued that the case of SQA Builders is distinguishable on the facts as the application in that case concerned the setting aside of the adjudication decision based on the adjudicator’s award of pre-adjudication decision interest for a period longer than that claimed by the successful party. The High Court found that, at most, the adjudicator had committed an error within her jurisdiction. Furthermore, as interest was pleaded by the successful party in the payment claim, para 57 in the judgment of the court as quoted by Mitrajaya viz. “Even if the element of interest had not been raised in the Payment Claim, the Adjudicator would have acted within jurisdiction if she had awarded interest under her vast powers under section 25(o) CIPAA. …” is merely the learned Judge’s obiter dictum. [81] This Court has considered the decisions in Milsonland Development, SQA Builders and Naza Engineering and is of the view that the S/N xh8T7sFBYkuCRUzm7qyz1w decision of the High Court in Naza Engineering must be understood in the context of the factual matrix in that case where –

the adjudicator had awarded multiple pre-AD interest (see para 2(4)(b) at p 505 of the law report);

if the fourth pre-AD interest sum was allowed, it would result in an unjust enrichment of the party in whose favour the AD is made; and

no application to enforce the AD under s 28 CIPAA was filed and hence it was not possible for the court to sever the AD so as to enforce only part of the AD which does not include the award as to the fourth pre-AD interest. [82] In the instant case, whilst the pre-AD interest was not claimed in the Payment Claim but was only raised in the Adjudication Response, the Court is of the opinion that the Adjudicator has acted within his S/N xh8T7sFBYkuCRUzm7qyz1w jurisdiction in awarding pre-AD interest in accordance with the powers under s 25(o) of the CIPAA. [83] It is observed that the dates from which interest shall start to run are either on the due date for payment of the claimed amount as stated in the Payment Claim or just a few days after that. The Adjudicator’s award of interest is therefore in conformity with the general rule that interest ought to run from the date on which the debt becomes due and payable, and the objective of awarding interest which is to compensate the unpaid party who has been deprived of the use of the money due to him for the period when he was deprived of its enjoyment. [84] In the upshot, the Court remains unconvinced that the Adjudicator had acted in excess of his jurisdiction on the ground as put forth by MBSB. S/N xh8T7sFBYkuCRUzm7qyz1w II. O.S No. 91: The Stay Application [85] MBSB’s application was made pursuant to para 16(1)(b) CIPAA which provides that: “Stay of Adjudication Decision

16.

A party may apply to the High Court for a stay of an adjudication decision in the following circumstances:

…

the subject matter of the adjudication decision is pending final determination by arbitration or the court.”. [86] In para 54 of the AIS (encl. 15), MBSB averred that it was in the midst of taking steps to initiate arbitral proceedings against Mitrajaya and hence, MBSB was entitled to apply for a stay of the AD pending final determination by arbitration. S/N xh8T7sFBYkuCRUzm7qyz1w [87] By the time MBSB filed its AIR (encl. 27), the Notice of Arbitration dated 20.8.2021 had already been issued (see exhibit “LNH-17”) whereby the issues in dispute are, amongst others, the works which were carried out by Mitrajaya; the payments allegedly due to Mitrajaya for the works; the applications for EoT submitted by Mitrajaya; Mitrajaya’s alleged breaches under the contract; and the LAD and/ or damages due to MBSB for Mitrajaya’s delay in completing the works. [88] MBSB attempted to persuade this Court that a stay of the AD is warranted pending final determination of the dispute between the parties by arbitration because MBSB has satisfied the threshold by commencing the arbitration against Mitrajaya and there are “clear and unequivocal errors” in the AD, the meaning of which has been expounded in View Esteeem (supra). It was emphasised that a stay under s 16 CIPAA operates as a safeguard to a likely wrongful AD. [89] The courts have consistently held that merely fulfilling the threshold requirement for a stay in that an application to set aside an adjudication decision under s 15 CIPAA has been made or that the subject matter S/N xh8T7sFBYkuCRUzm7qyz1w of the adjudication decision is pending final determination by arbitration or the court is insufficient (see for example, Bumimetro Construction Sdn Bhd v. Mayland Universal Sdn Bhd & Another Case [2017] 1 LNS 1959 and Genbina Sdn Bhd v. Bina Puri Construction Sdn Bhd [2020] 2 MLRH 101). [90] In the consideration of matters related to the CIPAA, the courts do not lose sight of the purpose and objective of the CIPAA which is to facilitate regular and timely payment for works done and services rendered under construction contracts by providing a speedy dispute resolution mechanism. To allow a stay of the AD just because the unsuccessful party in the adjudication proceedings has met the threshold requirement(s) under s 16 CIPAA would surely defeat the purpose of the statutory adjudication regime. [91] As the Court is satisfied that there are no clear and unequivocal errors on the part of the Adjudicator, MBSB’s application that the AD be stayed pending the final determination by arbitration has no leg to stand on. Moreover, MBSB did not make any submission that the S/N xh8T7sFBYkuCRUzm7qyz1w circumstances of the case are such that it would be in the interest of justice to stay the enforcement of the AD. II. O.S. No. 102: Enforcement Application [92] Mitrajaya’s application was made pursuant to s 28 of the CIPAA which provides that: “Enforcement of adjudication decision as judgment

28.

A party may enforce an adjudication decision by applying to the High Court for an order to enforce the adjudication decision as if it is a judgment or order of the High Court.

The High Court may make an order in respect of the adjudication decision either wholly or partly and may make an order in respect of interest on the adjudicated amount payable. S/N xh8T7sFBYkuCRUzm7qyz1w

The order made under subsection (2) may be executed in accordance with the rules on execution of the orders or judgment of the High Court.”. [93] The Court has, in the preceding paragraphs, elaborated on the reasons as to why the Setting Aside Application was dismissed. It necessarily follows that the conditions for the enforcement of the AD have been satisfied, namely that –

there is the AD which has been rendered in Mitrajaya’s favor;

there has been non-payment of the adjudicated sum by the date as specified in the AD which is no later than 8.6.2021; and

there is no prohibition to the grant of the order that is sought in the Enforcement Application in that the AD has not been set aside or stayed; there is no written settlement of the subject matter between the parties, or there is no final decision rendered on the Payment Claim, whether made in arbitration or by a court of law (see the decision of the Court of Appeal in Inai Kiara Sdn S/N xh8T7sFBYkuCRUzm7qyz1w Bhd v. Puteri Nusantara Sdn Bhd [2019] 2 CLJ 229 and applied in numerous cases to date). Pronouncement [94] Based on the foregoing reasons, the Setting Aside/ Stay Application was dismissed and the Enforcement Application was allowed with costs of RM5,000.00 to be paid by MBSB to Mitrajaya for each application, subject to allocatur. Dated: 6 January 2023 (ALIZA SULAIMAN) Judge Construction Court 2 High Court Kuala Lumpur S/N xh8T7sFBYkuCRUzm7qyz1w Counsels/ Solicitors: For the Plaintiff in O.S. No. WA-24C-91-07/2021 and the Defendant in O.S. No. WA-24C-102-07/2021: Lam Ko Luen (Nina Lai Jian Xian with him) Messrs. Shook Lin & Bok Advocates & Solicitors 20the Floor, AmBank Group Building 55, Jalan Raja Chulan 50200 Kuala Lumpur For the Plaintiff in O.S. No. WA-24C-102-07/2021 and the Defendant in O.S. No. WA-24C-91-07/2021: Chan Kheng Hoe (Wong Sheng Wei with him) Messrs. Chong + Kheng Hoe Advocates & Solicitors A3-3-6 Block A3 Solaris Dutamas 1, Jalan Dutamas 1 50480 Kuala Lumpur S/N xh8T7sFBYkuCRUzm7qyz1w Cases, legislation and other sources referred to in the submissions by learned counsels and in the Grounds of Judgment: Cases: ACFM Engineering & Construction Sdn Bhd v Esstar Vision Sdn Bhd and another appeal [2016] MLJU 1776 Ann Joo Integrated Steel Sdn Bhd v. Lim Chuan Hock & Sons Sdn Bhd [2018] 4 CLJ 497 Asal Construction Sdn Bhd v Insan Makmur Sdn Bhd [2018] AMEJ 1263 Bar Council Malaysia v Tun Dato’ Seri Arifin bin Zakaria & Ors (Persatuan Peguam-Peguam Muslim Malaysia, intervener) and another appeal [2020] 4 MLJ 773 Bertam Development Sdn Bhd v. R&C Cergas Teguh Sdn Bhd [2017] 1 LNS 1556; [2017] MLJU 1571 BM City & Construction Sdn Bhd v. Merger Insight (M) Sdn Bhd & Another Case [2016] 1 LNS 1096 Bumimetro Construction Sdn Bhd v. Mayland Universal Sdn Bhd & Another Case [2017] 1 LNS 1959 S/N xh8T7sFBYkuCRUzm7qyz1w Cantillon Ltd v. Urvasco Ltd [2008] EWHC 282 (TCC) Econpile (M) Sdn Bhd v. IRDK Ventures Sdn Bhd & another case [2016] 5 CLJ 882 Emerald Capital (Ipoh) Sdn Bhd v Pasukhas Sdn Bhd and another appeal [2018] MLJU 440 Enra Engineering and Fabrication Sdn Bhd v Gemula Sdn Bhd and another summon [2019] MLJU 369 Genbina Sdn Bhd v. Bina Puri Construction Sdn Bhd [2020] 2 MLRH 101 Genting Malaysia Berhad v. PLM Interiors Sdn Bhd [2020] 1 LNS 218 Guangxi Dev & Cap Sdn Bhd v. Sycal Bhd & another appeal [2019] 1 CLJ 592 Hiform (M) Sdn Bhd v Tsr Bina Sdn Bhd and another summons [2020] MLJU 808; [2020] MLRHU 588 Inai Kiara Sdn Bhd v. Puteri Nusantara Sdn Bhd [2019] 2 CLJ 229 Itramas Technology Sdn Bhd v Savelite Engineering Sdn Bhd and other cases [2021] MLJU 1382 S/N xh8T7sFBYkuCRUzm7qyz1w Jeks Engineering Sdn Bhd v Pali PTP Sdn Bhd and another case [2021] MLJU 1627 Kayangan Kemas Sdn Bhd v TMT Solutions Sdn Bhd [2019] MLJU 1225 Kerajaan Malaysia v. Ven-Coal Resources Sdn Bhd [2014] 5 CLJ 186 Kining Exeton Sdn Bhd v. Majlis Perbandaran Kuantan & another case [2020] 1 LNS 1066 KL Eco City Sdn Bhd v. Tuck Sin Engineering & Construction Sdn Bhd & anor [2020] 1 LNS 2234; [2020] AMEJ 1852 Kumpulan Darul Ehsan Bhd v Mastika Lagenda Sdn Bhd [2017] 4 MLJ 561 Maju Holdings Sdn Bhd v. Spring Energy Sdn Bhd [2020] 1 LNS 1193 Master Strike Sdn Bhd v Sterling Heights Sdn Bhd [2005] 3 MLJ 585 Milsonland Development Sdn Bhd v Macro Resources Sdn Bhd & Ors and another suit [2018] MLJU 1912 MRCB Builders Sdn Bhd v SMM Resources Sdn Bhd and another case [2021] MLJU 1856 S/N xh8T7sFBYkuCRUzm7qyz1w MRCB Builders Sdn Bhd v Wazam Ventures Sdn Bhd and another case [2020] MLJU 208 Naza Engineering & Construction Sdn Bhd v SSL Dev Sdn Bhd [2020] 9 MLJ 499 PCP Construction Sdn Bhd v Leap Modulation Sdn Bhd and other appeals [2018] MLJU 1357 PCP Construction Sdn Bhd v Leap Modulation Sdn Bhd and other suits [2017] MLJU 905 Pilon Ltd v Breyer Group plc [2010] EWHC 837 (TCC) Ranhill E & C Sdn Bhd v Tioxide (M) Sdn Bhd and other appeals [2015] MLJU 1873 Richallenge Corp Sdn Bhd v Poteck Enterprise Sdn Bhd [2020] 3 MLJ 704 Rosha Dynamic Sdn Bhd v Mohd Salehhodin bin Sabiyee & Ors and other cases [2021] MLJU 1222 SKS Pavillion Sdn Bhd v Tasoon Injection Pile Sdn Bhd [2018] 5 AMR 889 SQA Builders Sdn Bhd v Luxor YRM Sdn Bhd and another appeal [2017] MLJU 2256 S/N xh8T7sFBYkuCRUzm7qyz1w Terminal Perintis Sdn Bhd v Tan Ngee Hong Construction Sdn Bhd and another case [2017] MLJU 242 Top Speed Holding Sdn Bhd v. Conlay Construction Sdn Bhd [2011] 1 LNS 238 Toupos Palm Oil Mill Sdn Bhd v. Pembangunan Lapanseri Sdn Bhd & Another Case [2020] 1 LNS 51 TYL Land and Development Sdn Bhd v. SIS Integrated Sdn Bhd & Another Case [2018] 1 LNS 145 View Esteem Sdn Bhd v. Bina Puri Holdings Bhd [2019] 5 CLJ 479 Legislation: Construction Industry Payment and Adjudication Act 2012, ss 5, 7, 8, 15, 16, 24, 25, 27 & 28 Interpretation Acts 1948 And 1967, s 3 Rules of Court 2012, O. 5 r. 3, O. 7, O. 28, O. 69A rr. 2, 3, 4 and 5 & O. r. 4 S/N xh8T7sFBYkuCRUzm7qyz1w Other sources: Datuk Sundra Rajoo and Ir Harbans Singh KS, Construction Law in Malaysia, Sweet & Maxwell Asia, 2012 Lim Chong Fong, The Malaysian PWD Form Of Construction Contract, Second Edition, Sweet & Maxwell Asia, 2011 Online Oxford, Cambridge, Britannica and Merriam-Webster dictionaries S/N xh8T7sFBYkuCRUzm7qyz1w