Prinsiptek (M) Sdn Bhd v Naza Ttdi Sentralis Sdn Bhd (WA-22C-115-12/2019)

On 24.12.2019, the Plaintiff filed the Writ of Summons and Statement of Claim (‘SoC’) against the Defendant seeking declaratory and injunctive reliefs as well as claims for outstanding amount of monies 2 and general damages arising from a development project in Shah Alam, Selangor. On the same date, the Plaintiff also filed an Ex-Parte Notice of Application (‘NoA’) together with a Certificate of Urgency (encls. 4 and 3, respectively) pursuant to O. 29, r. 1(1) and/ or r. 1(2) and/ or O. 92, r. 4 of the Rules of Court 2012 (‘RoC 2012’) for an injunction to restrain the Defendant from, among others, making a demand or a claim on, and from receiving any amount paid under, the Bank Guarantee Form For Performance Bond (Works) (Reference No. 99010BGP6100964) in the sum of RM10,987,342.46 issued by Malayan Banking Berhad (‘MBB’) on behalf of the Plaintiff in favour of the Defendant dated 8.6.2015 (with a 1st Amendment dated 21.6.2018, a 2nd Amendment dated 15.3.2019 and an expiry date of 4.4.2020; hereinafter referred to as the ‘PB’) until the final disposal of all disputes between the parties through arbitration, litigation or the present suit.

The Plaintiff’s counsel appeared before Justice Lim Chong Fong on 26.12.2019 and obtained an order in terms of prayers (a) and (b) in the NoA for an injunction, subject to the usual undertaking by the Plaintiff as to damages. 3

Subsequently, the matter was set for an inter-partes hearing, where after careful consideration of the related cause papers [which include, inter alia, the Plaintiff’s Affidavit in Support (‘AIS’; encl. 5), Additional Affidavit (‘AA’; encl. 8) and Affidavit in Reply (‘AIR’; encl. 21) affirmed by its Director, Mr. Andrew Lui Meng San on 24.12.2019, 26.12.2019 and 28.2.2020, respectively and the Defendant’s Affidavit in Reply (‘AIR’; encls. 15 - 17) affirmed by its Director of the Group Legal Affairs Division of Naza Corporation Holdings Sdn Bhd, Mr. Azmi bin Maulud on 7.2.2020], written submissions and oral submissions by Mr. Ekbal Singh appearing for the Plaintiff and Mr. Michael Koh representing the Defendant, this Court had dismissed the Plaintiff’s application in encl. 4 with costs of RM10,000.00 to the Defendant, subject to allocatur.

The full grounds for the decision are elaborated below. 4

The salient background facts are garnered from the averments in the affidavits and the documents exhibited therein.

By way of a letter of Award (‘LoA’) dated 8.5.2015, the Defendant appointed the Plaintiff as the main contractor for the construction and completion of superstructure works (TTDI Sentralis) for the project known as “Cadangan Pembangunan Yang Mengandungi Section 1:4 Tingkat Tempat Letak Kereta Bertingkat & 1 Tingkat Tempat Letak Kereta Terbuka Atas Podium, 3 Aras Kedai (78 Unit) & Kedai Mampu Milik, 1 Aras Kedai Pejabat (29 Unit), Section 2:1 Blok Suite Perniagaan 12 Tingkat (206 Unit) & 1 Aras Kemudahan Suite Perniagaan, Section 3:1 Blok Pangsapuri Perkhidmatan 13 Tingkat (260 Unit) Di Atas 6 Aras Tempat Letak Kereta & 1 Aras Kemudahan Pangsapuri Perkhidmatan di Plot J5, No. 2A Jalan Tukul Besi 13/41, Seksyen 13, 40100 Shah Alam, Selangor Darul Ehsan” (‘Project’). 5

According to the terms and conditions in the LoA, the contract is based on the Agreement and Conditions of PAM Contract 2006 (With Quantities) published by Pertubuhan Akitek Malaysia subject to amendments, amplifications and supplementary clauses as set out in the tender documents (‘Contract’).

Further, the LoA provides that the Contract Sum for the Project is RM219,746,849.14 excluding Goods and Services Tax; the date of site possession is 22.5.2015; the completion date for the overall works, including the remaining Section 3 comprising the Service Apartments, is 21.3.2018 (completion period of 34 months) and 21.1.2017 for Section 1 & 2 which have “Commercial, Podium, Parking , External Works, Infrastructure and Business Suite (SOVO)” as the components (completion period of 20 months); and the Defendant is required to deposit with the Plaintiff a Bank Guarantee for the sum of 5% of the Contract Sum amounting to RM10,987,342.46 for the due performance of the Contract. 6

On 5.4.2017, the parties entered into a Supplemental Agreement No. 1 (‘SA No. 1’). Vide Clause 1.0 in SA No. 1, Section 4 of the LoA and Clause 21.0 of the Contract were amended to provide a deferred date of completion for Section 1 & 2 as 21.10.2017 and Section 3 as 21.12.2018.

A meeting attended by the representatives of the parties took place at the Defendant’s office on 22.5.2017. Subsequently, the Plaintiff wrote to the Defendant on 19.7.2017 to capture the instructions given by the latter to, among others, prolong the work programme so that the completion date for Section 1 & 2 would be extended to 21.2.2018; and that the Defendant will prepare a supplementary agreement and table the same to its management for approval. The letter also states the Plaintiff’s agreement that the total loss and expenses claim for the deferment would be RM4.5 million.

On 24.10.2017, the Architect issued a Certificate of Non-Completion (‘CNC No. 1’) for the works for Section 1 & 2. 7

The parties then executed another supplemental agreement on 6.12.2017 i.e. Supplemental Agreement No. 2 (‘SA No. 2’). Vide Clause 2.0 in SA No. 2, Clause 1.0 of SA No. 1 was amended to provide a 2nd deferred date of completion for Section 1 & 2 as 21.2.2018. The Defendant wrote a letter dated 21.12.2017 to the Plaintiff stating that, by virtue of Clause 22.3 of the Contract, the SA No. 2 has the effect of revoking CNC No.

[13] During the performance of the works, the Plaintiff made the following applications for extension of time (‘EoT’):

EoT of 10 months from 21.2.2018 to 20.12.2018 for Section 1 & 2 vide letter dated 27.12.2017 (‘EoT No. 2’) attaching the details of Delay Event No. 1 - 9 and citing the additional ground of late confirmation on SA No. 2 as the reasons for the EoT application (at the outset, it should be made clear that the Court did not find any application for EoT dated 1.2.2018 as contended by the Plaintiff); 8

EoT of 296 days from 21.2.2018 to 13.12.2018 for Section 1 & 2 vide letter dated 14.2.2018 (‘EoT No. 2A’). However, on 23.2.2018, the Plaintiff informed that the period for the EoT application was for 400 days viz. until 28.3.2019 instead; and

EoT of 679 days for Section 1 & 2 and 376 days for Section 3 vide letter dated 23.1.2019 (‘EoT No. 3’) which, if approved, would result in the date of completion being pushed to 31.12.2019 for Section 1 & 2 and Section 3. [14] Returning to events which occurred earlier, on 22.2.2018, the Architect issued a CNC (‘CNC No. 2’) for the works for Section 1 & 2 which had not been completed in accordance with the date as provided in the SA No.

The Plaintiff was put to notice of the Defendant’s right to claim for Liquidated Damages (‘LD’) pursuant to Clause 22.2 of the Contract. [15] In a four-page letter to the Plaintiff dated 27.7.2018, the Architect conveyed its final assessment of the Plaintiff’s application for EoT No. 9 2A namely, that there was no ground to justify the Plaintiff’s entitlement to an EoT. [16] What then followed was a notice from the Plaintiff to the Defendant dated 18.9.2018 that it will invoke its rights under Clause 30.7 of the Contract to suspend the works due to late payment by the Defendant. That right was exercised vide letter dated 1.11.2018 notifying the Defendant that the works will be suspended from 2.11.2018 and shall remain effective until such time that all outstanding payment has been made. [17] However, as a result of the Defendant’s proposed payment schedule and a discussion held on 18.12.2018, the Plaintiff wrote a letter dated 24.12.2018 to inform the Defendant that it acknowledged the partial payment made and the works will be resumed without prejudice to the Plaintiff’s contractual rights. [18] Unfortunately for the parties, there was no end in sight to the dispute. Apart from the exchange of correspondence as outlined above, the 10 Plaintiff had also written to the Architect on 19.10.2018 complaining about the delay in the issuance of the Architect’s Instructions (‘AI’) and approval of the Variation Order (‘VO’). The Plaintiff appealed to the Architect to act fairly, impartially and independently when exercising its function as the contract administrator. [19] The subject of assessment and payment for variation works was highlighted again in the Plaintiff’s letter of 30.1.2019 wherein the Architect was urged to investigate the issue of uncertified VO on an urgent basis. [20] The progress of works was further impeded by the notice given by the Nominated Sub-Contractor, P&M Electrical & Mechanical Sdn Bhd (‘P&M’) on 28.3.2019 that it is no longer interested to continue with the Project. This turn of events was brought to the attention of the Architect vide the Plaintiff’s letters dated spanning from April 2019 until August 2019 and culminated in the Plaintiff communicating its intention on 9.10.2019 to claim an EoT for four months on account of the delay in terminating P&M. 11 [21] Meanwhile, the Defendant alleged that by October 2019, it had made full payments to the Plaintiff for all interim certificates that were due. However, the Plaintiff’s workers stopped working on 15.10.2019 because they claimed that the Plaintiff had not paid their wages for four months. On 16.10.2019, the workers staged a protest by barricading the main entrance to the Project site with concrete drain culverts. The Architect wrote to the Plaintiff on the same date and on 18.10.2019 instructing the Plaintiff to resolve the issue of the workers’ wages immediately. [22] In view of the “poor site progress”, the Defendant informed the Plaintiff on 4.11.2019 that it is exercising its right to cease the deferment of LD deduction as the Plaintiff had failed to achieve the agreed target milestone based on the CNC dated 22.2.2018 for Section 1 & 2, and 21.12.2018 for the overall remaining works. As expected, this was met with protestations by the Plaintiff vide letter dated 15.11.2019. [23] Things came to a head when the Defendant issued the notice of default to the Plaintiff on 22.11.2019 pursuant to Clause 25.2 of the Contract 12 informing the Plaintiff that it was in breach of Clauses 25.1(b) and (c), namely that it, without reasonable cause, has wholly or substantially suspended the carrying out of the works before completion and failed to proceed regularly and/ or diligently with the works. The Architect gave the Plaintiff 14 days to cure the default. [24] The Plaintiff responded on 27.11.2019 by alleging that the Defendant had, among others, committed acts of prevention by instructing the Plaintiff to slow down works, interfering with the VO and changing the format of valuation of the progress claims. [25] The Defendant finally determined the Contract on 18.12.2019 and called on the PB on 20.12.2019. [26] Four days later, the suit was filed. For present purposes, attention must be given to the Plaintiff’s NoA in encl. 4 wherein the prayers are for the following: 13 “(a) Suatu perintah injunksi untuk menghalang Defendan, samada dirinya sendiri, melalui pengarah-pengarah, kakitangan-kakitangan, pekerja-pekerja, wakil-wakil dan/atau ejen-ejen ataupun sesiapa sahaja, daripada menerima hasil sebarang tuntutan yang dibuat di bawah Jaminan Bank (Rujukan No: 99010BGP6100964) melalui Malayan Banking Berhad untuk jumlah sebanyak RM10,987,342.46 (“Jaminan Bank”) atau sekiranya di mana hasil tersebut telah diterima, suatu perintah menghalang Defendan daripada memindahkan, menggunakan atau berurusan dengan apa jua cara dengan hasil tersebut, sehingga penyelesaian akhir pertikaian-pertikaian antara Plaintif dan Defendan berkaitan dengan dan/atau menimbul di bawah Kontrak bertarikh 2.11.2015 dengan cara timbang tara atau litigasi atau pelupusan tindakan ini atau apa-apa tempoh lain yang dianggap patut dan sesuai oleh Mahkamah Yang Mulia ini dan atas akujanji Plaintif untuk mematuhi dengan apa-apa perintah yang 14 dibuat oleh Mahkamah atau Hakim mengenai gantirugi sekiranya Mahkamah atau Hakim berpendapat selepas itu bahawa Defendan telah tanggung rugi atas alasan perintah ini yang mana pihak Plaintif patut bayar;

Suatu perintah injunksi untuk menghalang Defendan daripada membuat sebarang panggilan atau tuntutan yang selanjutnya terhadap Jaminan Bank sehingga penyelesaian akhir pertikaian-pertikaian antara Plaintif dan Defendan berkaitan dengan dan/atau menimbul di bawah Kontrak bertarikh 2.11.2015 dengan cara timbang tara atau litigasi atau pelupusan tindakan ini atau apa-apa tempoh lain yang dianggap patut dan sesuai oleh Mahkamah Yang Mulia ini dan atas akujanji Plaintif untuk mematuhi dengan apa-apa perintah yang dibuat oleh Mahkamah atau Hakim mengenai gantirugi sekiranya Mahkamah atau Hakim berpendapat selepas itu bahawa Defendan telah tanggung rugi atas alasan perintah ini yang mana pihak Plaintif patut bayar; 15

Bahawa kos permohonan ini dibayar oleh Defendan kepada Plaintif; dan

Apa-apa relief yang lain atau selanjutnya yang difikirkan patut dan adil oleh Mahkamah Yang Mulia ini.”. [27] In the brief grounds set out in encl. 4 to support the application, three distinct reasons can be deciphered, namely – “…

Defendan telah gagal untuk membayar kepada pihak Plaintif jumlah keseluruhan berdasarkan sijil pembayaran interim No. 46 yang berjumlah sebanyak RM1,547,672.13 walaupun sijil tersebut telahpun dikeluarkan dan/atau jumlah tuntutan berperingkat telahpun disahkan oleh Defendan dan/atau Arkitek Defendan dan juga telah melepasi tempoh masa untuk pembayaran yang dipersetujui oleh pihak-pihak. 16

Terdapat kelewatan melampau dan/atau kemungkiran Defendan untuk membuat bayaran bagi tuntutan-tuntutan Plaintif, ia telah menyebabkan banyak kekangan-kekangan dan kesusahan kepada Plaintif dalam melaksanakan kerja-kerja bagi projek tersebut. …

Ia adalah unconscionable untuk Defendan menuntut dan/atau panggil Jaminan Bank tersebut kerana Plaintif mempertikaikan penamatan Perjanjian oleh Defendan dan menegaskan bahawa ia adalah suatu penamatan salah dan tidak sah. …”. 17 The Legal Principles [28] Unconscionable conduct as a distinct and independent ground apart from fraud for seeking injunctive relief to restrain a beneficiary from making a demand on, and receiving monies under, the performance bond is well entrenched in the law (see Focal Asia Sdn Bhd & Anor v Raja Noraini binti Raja Datuk Nong Chik & Anor [2011] 2 AMR 515; Kejuruteraan Bintai Kindenko Sdn Bhd v Nam Fatt Construction Sdn Bhd & Anor [2011] 2 AMCR 461; Sumatec Engineering and Construction Sdn Bhd v Malaysian Refining Co Sdn Bhd [2012] 2 AMR 673; Target Resources Sdn Bhd v THP Bina Sdn Bhd [2019] 4 MLRA 594; and Dunggon Jaya Sdn Bhd v Aeropod Sdn Bhd & Anor (and Another Appeal) [2019] 2 SSLR 339). [29] In determining whether an injunction as sought by the Plaintiff ought to be granted, this Court is guided by the principles as laid down by the appellate courts and which may be summed up as follows:

the test is the “seriously arguable and realistic inference” test; 18

the Plaintiff must show manifest or strong evidence of some degree in respect of the alleged unconscionable conduct on the part of the Defendant and not merely make a bare assertion;

the Plaintiff has to establish a strong, prima facie case; or sufficient evidence to enable the Court to be satisfied, not necessarily beyond reasonable doubt, that a case of unconscionability is being committed by the Defendant to an extent sufficient for the Court to be minded to order the injunction sought. The events or conduct must be such as to prick the conscience of a reasonable and sensible man;

unconscionability is tantamount to actions that lack bona fides where there is an element of unfairness or some form of conduct which appears to be performed in bad faith;

mere breaches of contract, without more, would not by themselves amount to unconscionability; and 19

a determination as to whether unconscionability applies would depend largely on the facts of each case (this test was applied in the decisions of this Court in Jeks Engineering Sdn Bhd v Pali PTP Sdn Bhd [2019] 1 LNS 1392; Sinohydro Corporation (M) Sdn Bhd v Golden Horse Rubber Sdn Bhd [2020] 4 MLRH 685; and AFS Engineering (M) Sdn Bhd v MRCB Builders Sdn Bhd [2020] MLJU 2118). [30] In Dunggon Jaya (supra) the Court of Appeal held at para 31, p 347 that the test is not whether the unconscionable conduct complained of is proven or otherwise but whether sufficient evidence had been placed before the court so as to enable the court to be satisfied, not necessarily beyond reasonable doubt, that a case of unconscionability had been established to an extent that is sufficient for the court to be minded to order the injunction sought. 20 The PB as an unconditional or “on demand” bond [31] The PB in question can be seen in exhibit “LMS-17” in the Plaintiff’s AA where in the main, it states: “Now the Guarantor hereby agrees with the Principal as follows :-

If the Contractor (unless relieved from the performance by any clause of the Contract or by statute or by the decision of a tribunal of competent jurisdiction) shall in any respect fail to execute the Contract or commit any breach of his obligations thereunder then the Guarantor shall pay to Principal up to and not exceeding the sum of RINGGIT MALAYSIA : TEN MILLION NINE HUNDRED EIGHTY SEVEN THOUSAND THREE HUNDRED FORTY TWO AND SEN FORTY SIX ONLY (RM10,987,342.46) representing 5% of the Contract value or such part thereof, on the Principal’s demand 21 notwithstanding any contestation or protect by the Contractor or by the Guarantor or by any other third party. Provided always that the total of all partial demands so made shall not exceed the sum of RINGGIT MALAYSIA : TEN MILLION NINE HUNDRED EIGHTY SEVEN THOUSAND THREE HUNDRED FORTY TWO AND SEN FORTY SIX ONLY (RM10,987,342.46) and that the Guarantor’s liability to pay for the Principal as aforesaid shall correspondingly be reduced proportionate to any partial demand having made as aforesaid.

The Guarantor shall not be discharged or released from this Guarantee by any arrangement between the Contractor and the Principal with or without the consent of the Guarantor or by any alteration in the obligations undertaken by the Contractor or by any forbearance whether as to payment, time performance or otherwise, 22 but the Guarantor shall be entitled to be informed of such arrangement or alterations.

This Guarantee shall be irrevocable and shall remain in force and effect from 22nd day of May 2015 until 03rd Day of July 2018, until Defect liability Period + 14 days + 3 months after the completion period as stated in the said contract, computed from the date of completion of the works or any authorized extension/extension thereof, and on the case of the contract being determined, one calendar year after the date of determination. Claims, if any must be received by the Guarantor within the period of the Guarantee. …”. [32] The PB, being an unconditional or “on demand” performance bond by virtue of the choice of wordings in para 1 as quoted above and having been amended twice were not raised as issues at the hearing of the 23 NoA. As such, MBB would become liable when the demand was made upon them by the Defendant for payment of the stipulated sum without any need for the Defendant to prove any default by the Plaintiff in the performance of the Contract. [33] In addition, with the PB as an “on demand” and irrevocable bond, it is only in exceptional cases that the courts will interfere with the obligations of the bank under such instruments: see Harbottle (RD) (Mercantile) v National Westminster Bank [1978] QB 146 which was cited with approval by the Federal Court in Esso Petroleum Malaysia Inc v Kago Petroleum Sdn Bhd [1995] 1 AMR 189 and Sumatec (supra). The courts in Malaysia have consistently followed the English position that the issuer must honour the performance bond according to its terms except in a case of fraud, which is brought to the notice of the issuer. As outlined earlier, the Malaysian courts have also recognised the element of unconscionability as a distinct ground for restraining the beneficiary from calling on, or demanding monies under, the performance bond (see Chapter 11: Restraining Calls on Bank Guarantees, Performance Bonds and Letters of Credit by Tan 24 Gian Chung and Sanjiv Naddan in Law and Practice of Injunctions in Malaysia, General Editor Robert Lazar and a team of expert contributors, Sweet & Maxwell, 2020 at pp 369 - 371). [34] In determining whether there is a “seriously arguable and realistic inference” of unconscionability to warrant an injunction, this Court shall next consider the facts as presented in this case as they relate to the issues which arose at the inter-partes hearing of the Plaintiff’s application in encl. 4. [35] It is observed that the grounds on which the Plaintiff alleged that it is unconscionable for the Defendant to call on the PB are similar to the ones mentioned in the Plaintiff’s letter dated 27.11.2019 as a response to the Defendant’s Notice of Default for Determination of Contractor’s Employment By Employer dated 22.11.2019, namely that the Plaintiff was entitled to an EoT, was paid late, and was instructed to slow down the works; the Defendant interfered with the Contract; and there were acts of prevention by the Defendant. 25

(A) Was the rejection of the Plaintiff’s applications for EoT unconscionable? - The Plaintiff’s Submissions [36] In his submission for the Plaintiff, Mr. Ekbal Singh highlighted the fact that the Defendant faced cashflow difficulties and instructions were given to the Plaintiff to slow down the works for the Project. The completion dates for the Project was extended twice vide the SA No. 1 and SA No. 2. The Plaintiff was similarly affected by cashflow problems when interim payments by the Defendant were constantly delayed contrary to the provision of Clause 9.2 of the LoA. These problems were accentuated by the late issuance of the AI and approval of the VO as well as the determination of P&M as the sub-contractor for the Project. [37] Against this backdrop, the Plaintiff argued that the Defendant’s rejection of the Plaintiff’s applications for EoT was unconscionable, and the following reasons were given in respect of each of the EoT application: 26

EoT No. 2: Nine delay events were set out in the Defendant’s letter dated 27.12.2017 which comprise delay in responses by other contractors and the requirement for additional works to be carried out. The Plaintiff is entitled to make the application for EoT pursuant to Clause 23.8(j) and (q) of the Contract.

EoT No. 2A: Additional work was required for the TNB Manholes and Electrical Cable Trenching (‘ECT’) without which the building will not be able to be handed over to the Defendant. A critical path analysis was submitted to the Defendant. The Plaintiff is entitled to an EoT under Clause 23.8(q) of the Contract.

EoT No. 3: Flowing from the Defendant’s default in the payment of the Interim Certificates, the Plaintiff was entitled to suspend the works as provided 27 under Clause 30.7 of the Contract and is entitled to an EoT pursuant to Clause 23.8(m) and (v) of the Contract. [38] It was further contended that the Architect had, apparently under the Defendant’s instructions, issued the CNC No. 1 despite having notice of the Defendant’s instructions to the Plaintiff to defer the work programme for the Project. [39] As regards the imposition of LD against the Plaintiff, learned counsel submitted that this is misconceived especially since the Defendant still holds the retention sum of RM10,081,056.94 pursuant to Interim Certificate No. 46 (exhibit “LMS-3”). - The Defendant’s Submissions [40] Mr. Michael Koh opened his submissions on this issue by asserting that the Architect had acted reasonably and his findings regarding the 28 applications for EoT were fair and correct. The Plaintiff did not provide any proof to show otherwise. Learned counsel proceeded to examine each EoT application to further exemplify his grounds of contention. [41] In any event, it was submitted on the authorities of Daya CMT Sdn Bhd v Yuk Tung Construction Sdn Bhd [2016] 1 LNS 649 and JK Integrated (Pte Ltd) v 50 Robinson Pte Ltd and another [2015] SGHC 57 that the Plaintiff’s allegations, at best, only establish that there is a dispute between the parties which should be determined at the trial or arbitration. At this stage, even if an EOT application was wrongly rejected, that does not amount to unconscionable conduct. Findings of the Court - Instructions to slow down the works and issuance of CNC No. 1 [42] The Defendant does not deny that such instructions were given to the Plaintiff before the signing of the SA No. 1 and SA No. 2. In fact, among the many documents exhibited by the Defendant in its AIR was the 29 Minutes of Site Meeting No. 36 on 15.11.2016 which shows the earliest record of the Defendant’s instruction to defer the completion for Section 1 & 2. In para 1.4 of the said Minutes, the meeting noted that the Defendant had “ … confirmed on the Deferment of Completion for Section 1 & 2 (with reference to IMSB’s letter ref no … dated 4th November 2016)” and that the Plaintiff was to “ … prepare and send soft copy of revised work programme …” to the Architect and other consultants for reference and checking. [43] However, the Defendant contended that instructions were only to the extent that the new completion dates be revised to 21.2.2018 for Section 1 & 2 and 21.12.2018 for Section 3 as reflected in the SA No. 1 and SA No. 2. Having scrutinised the correspondence and other documents as exhibited, this Court agrees with the Defendant’s submission that further delays beyond the completion dates as stipulated in the SA No. 1 and SA No. 2 cannot be attributed to the initial instructions of the Defendant as whatever cash flow difficulties faced by the Defendant at the material time which affected the completion dates for Section 1 & 2 and Section 3 are taken to have 30 been addressed by the amendments made to the completion dates as mutually agreed by both parties in the SA No. 1 and SA No. 2. [44] In respect of the Plaintiff’s dissatisfaction at the issuance of CNC No. 1 on 24.10.2017 despite the instructions given by the Defendant at the meeting held on 22.5.2017 to prolong the work programme so that the completion date for Section 1 & 2 would be extended to 21.2.2018, to my mind this is a non-issue because the Defendant, vide the letter dated 21.12.2017 to the Plaintiff, had unequivocally stated that the SA No. 2 has the effect of revoking CNC No. 1. - Application for EoT No. 2 (Section 1 & 2) [45] The general rule is that an extension of time can only be contractually valid and tenable at law if it complies strictly with the relevant contractual procedures governing the contractor’s notification of the delay, application for EoT and the contract administrator’s assessment and ultimate award of the EoT due to the contractor in a particular case (see 31 Construction Law in Malaysia by Datuk Sundra Rajoo and Ir Harbans Singh KS, Sweet & Maxwell Asia, 2012 at p 364). An express provision which deals with these matters is Clause 23.1 of the Contract and it reads: “23.0 Extension Of Time

23.1 If the Contractor is of the opinion that the completion of the Works is or will be delayed beyond the Completion Date by any of the Relevant Events stated in Clause 23.8, he may apply for an extension of time provided always that:

23.1(a) the Contractor shall give written notice to the Architect his intention to claim for such extension of time together with an initial estimate of the extension of time he may require supported with all particulars of the cause of delay. Such notice must be given 32 within twenty eight (28) Days from the date of the AI, CAI or the commencement of the Relevant Event, whichever is earlier. The giving of such written notice shall be a condition precedent to an entitlement of extension of time; and

23.1(b) within twenty eight (28) Days of the end of the cause of delay, the Contractor shall send to the Architect his final claim for extension of time duly supported with all particulars to enable the Architect to assess any extension of time to be granted. If the Contractor fails to submit such particulars within the stated time (or within such longer period as may be agreed in writing by the Architect), it shall be deemed that the Contractor has assessed that such Relevant 33 Event will not delay the completion of the Works beyond the Completion Date.”. [46] A useful explanation on the entire Clause 23.0 of the Contract can be found at pp 418 - 487 in The PAM 2006 Standard Form of Building Contract by Sundra Rajoo, Dato’ WSW Davidson and Ir Harbans Singh KS, Lexis Nexis, 2010. For present purposes, suffice for me to refer to the following excerpts at pp 426, 427 and 430 (added emphasis is mine): “The first step of the claim for extension of time process is the notification covered under Clause 23.1(a). It requires the contractor giving to the architect a notice of his intention to claim for such extension of time. The notice should be in writing, but no particular form is specified. … Notwithstanding the express stipulation of giving notice as a pre-requisite to the contactor’s rights under Clause 23.1, the contractor shall, on his own volition make such a notification as part of his implied obligation under the contract to co- 34 operate fully with the employer and the architect in realising the eventual completion of the contract. … … From the foregoing, it can be inferred that the main purpose of giving notice is merely to warn the architect of the latest situation regarding the progress so that the architect would be able to monitor the position in order to form an opinion; a proposition supported by Justice Vinelott J in London Borough of Merton v Stanley Hugh Leach Ltd (1985) 32 BLR 51. This however can be tempered or revised by the parties through the relevant express provisions in the contract. Accordingly the PAM Contract 2006 has revisited and reformulate the matter expressly in the form of Clause 23.1(a).

a statement on the contractor’s intention to claim for extension of time; and

an initial estimate of the extension of time that he requires; and

all particulars of the cause of the delay. … Clause 23.1(a) in tandem with Clauses 11.7(a) and 24.1(a) states ‘The giving of such written notice shall be a condition precedent to an entitlement of extension of time’. … whatever the cause of the delay, be it an act of prevention or a neutral event (under Clause 23.8), the contractor must give a written notice in order to successfully obtain the extension he is seeking. …”. [47] Based on the above quoted passages, it is undoubtedly clear that the requirement for the Plaintiff to give written notice of its intention to claim 36 for an EoT is a condition precedent for an application for EoT, the absence of which will disentitle the Plaintiff to any EoT. [48] In the Architect’s reply, vide letter dated 22.1.2018, to the Plaintiff’s application for EoT No. 2, it was stated that that the document submitted by the Defendant is not in order and insufficient to enable the application to be reviewed. The Architect additionally referred to Clause 23.1(a) of the Contract which sets out the requirement for a notice of intention to claim for EoT to be sent to the Architect 28 days from the date of commencement of the relevant event. The relevant excerpt from the Architect’s letter (with my added emphasis) is shown below: “… Your supporting documents submitted as attachment titled “Correspondence related to extension of time no:2 (Section 1 & 2) do not seems to relate to the delay events no 1 to 9 mentioned in your list. Some of the correspondence are superseded and already being addressed previously. 37 Most important of all, for each of the relevant events, you are required to provide proof that you have given written notice to the Architect of your intention to claim for such an extension of time within 28 days of the instruction or commencement of the Relevant Event in accordance with Clause 23.1(a) of the Main Contract. This shall be a precedent to an entitlement for an extension of time. … Please note that your reason that Late of confirmation on Supplementary Agreement no 2 has contributed to your delay could not be entertained as it cannot be categorised under any of the Relevant Events stated in Clause 23.8 of the main contract. Furthermore, item 2(a) and 2(b) of the Supplemental Agreement no 2 clearly stipulate that the deferred date is final and that all such drawings submitted and instructions issued by either party up to date of this Supplemental Agreement No.2 shall be 38 deemed as conclusive for the Contractor to allocate adequate planning and resources for timely completion of the Project in strict compliance with the 2nd Deferred Date of Completion. You are therefore required to resubmit your application in accordance with the requirement of the contract within14 days from this letter.”. [49] Subsequently, the Plaintiff appears to have accepted that a written notice is indeed a condition precedent for an application for EoT when it sent a Notice of Delay dated 26.1.2018 wherein it was mentioned that the said Notice was pursuant to Clause 23.1(a) and as notification of its intention to claim EoT for 230 days from the date of receipt of the AI dated 16.1.2018, which was received on 24.1.2018, regarding the Works for TNB Manholes and ECT. [50] In view of the above consideration, the Court agrees with the Defendant that the issue of the application for EoT No. 2 is a non- 39 starter and there is nothing unconscionable surrounding this application. - Application for EoT No. 2A (Section 1 & 2) [51] I had earlier referred to the Notice of Delay dated 26.1.2018 which was sent to the Defendant and to which it replied on 14.2.2018 as follows: “We have reviewed your application and conclude that there is no ground for your claim for this event for the following reasons:

It has become apparent that the remaining substantial works for Section 1 and 2 could not be completed by the completion date of 21st February 2018. This has rendered the Works (TNB Manholes and Electrical Cable Trenching) to be no more on a critical path which 40 previously had to be completed urgently in order for you to deliver the building on the 21st February 2018.

In fact the Works can now be completed later whenever Section 1 and 2 are ready for testing and commissioning. Testing and commissioning could only be carried out when all electrically operated equipment or system that are needed to be tested are fully installed in the building.

The Works are considered to be isolated activities and could be planned and implemented in parallel or in sequence with the other activities that are currently delayed.

With regard to item 4 of your letter regarding “Consultant arranges TNB for laying cable – 2 months”, this claim is premature and would only be reviewed at the time when TNB would start to lay their cables to energize the substations. 41 Therefore your claim for EOT due to the above Architect instruction is rejected. We would also record that until to date, you have failed to complete the PPU and SSU, despite of our numerous reminders during the site meetings and via HSK’s letters dated 4th April 2016 and 13th May 2016 to complete the PPU and SSU for handing over to TNB. Any further delay on therse substations could only be attributed to your cause.”. [52] The Defendant’s letter of reply obviously crossed with the Plaintiff’s initial letter of application for EoT of 296 days dated 14.2.2018. The Plaintiff said that the application was made due to the additional works for TNB Manholes & ECT which, even though were moving concurrently with the builders work, does fall under the critical path as the building cannot be handed over without completion of the said additional works. The Plaintiff forwarded the Critical Path Analysis Programme Schedule to support the application in the letter to the 42 Defendant dated 23.2.2018 and amended the EoT period applied for from 296 days to 400 days thus bringing the extended completion date for section 1 & 2 to 28.3.2019. [53] On 9.3.2018, the Architect repeated the request that was made to the Plaintiff in a meeting held on 27.2.2018 for a detail programme to be provided by P&M with regards to the additional works. Further particulars in support of the Plaintiff’s justification were also requested. [54] The Critical Path Analysis, Summary of Architect’s Instruction/ variation works schedule and the letter from P&M were submitted to the Architect vide the Plaintiff’s letter dated 13.3.2018. [55] A meeting was held on 8.5.2018 at the Architect’s office to discuss the Plaintiff’s application for EoT No. 2. The Architect requested, among others, for further information relating to an item in the critical path programme. This meeting was recorded in the Architect’s letter to the Plaintiff dated 14.5.2018 wherein the Plaintiff was requested to further substantiate that the additional works is on the critical path as claimed 43 by the Plaintiff. The Architect noted that the existing works were already delayed beyond the completion date and are therefore critical. As a result, this could render the additional works to be non-critical. The Plaintiff was also requested to submit a breakdown for the activities involved in one of the items in the critical path programme. [56] It is appropriate at this juncture to make the observation that on 23.1.2018, the Architect had written to the Plaintiff to express its concern with the “ … rapid escalation in the delay of works which has digressed intolerably from your Master Programme (rev 3) as reported in the memorandums.” and asked that the Plaintiff address this matter in order to reduce further delay to the Project. In another letter dated 25.6.2018 titled “Remaining Works Completion of Section 1 & 2 and Section 3”, the Defendant in the last para reminded the Plaintiff that the site progress “had no sign of catching up as per architect letter ref. … dated 21/5/2018” and the Plaintiff was urged to show commitment to the programme which it had submitted. 44 [57] The Plaintiff’s application for EoT No. 2A was ultimately rejected by the Architect on 27.7.2018 for the following reasons:

The Plaintiff did not provide a breakdown in its original Master Work Programme: Baseline (Rev 0) (‘MWP’) to show the time allocation for all associated works to be provided by TNB for the supply of power to the Project site despite being requested to do so since 14.5.2018.

The Plaintiff is responsible in ensuring that power supply is supplied to the substations before the site is handed over to the Defendant and therefore the Plaintiff’s MWP is deemed to have taken into account the period required by TNB to carry out the works. Furthermore, the time allocated under the original MWP would not be affected by who carried out the works whether it was TNB, the Plaintiff or any other third party.

The impact of the AI on the overall delay for Section 1 & 2 has to be assessed in conjunction with the existing delay before the AI 45 was issued on 16.1.2018. The overall physical progress for Section 1 & 2 up to the end of December 2017 as reported in the Progress Report No. 62 was at 71.83%. Hence, even if the AI was not issued to the Plaintiff, it would still be impossible for the Plaintiff to complete the balance of 28.17% of work in only 49 days to the completion date of 21.2.2018. The issuance of the AI was considered to be non-critical.

The works were considered as an isolated event which would not have an effect on the progress of the remaining outstanding works.

When the Plaintiff submitted its Master Work Programme (Rev 3) for the SA No. 2, the Plaintiff only indicated a lead time of 3 months for TNB to supply power whereas a minimum of 6 months would be a more reasonable duration. Assuming that 6 months TNB lead time was reflected in the said Master Work Programme, the handing over date to TNB would be 16.10.2017 and completion date would be around 21.5.2018. However, no 46 such handing over took place on the date when the AI was issued. This further supports that the issuance of the AI is not critical. [58] Based on the above stated reasons, the Architect basically took the view that the AI could not have affected the timing in the works programme as the works for TNB Manholes and ECT had already been taken into account. Having gone through the exhibits, I am unable to find any correspondence by the Plaintiff which demonstrates its reaction to the Architect’s assessment of the application, especially in the form of protests or counter arguments. [59] In the upshot, the Court accepts the Defendant’s submissions that there is no evidence before the Court which establishes that the Architect’s decision was improper and/ or unfair. The Project was already delayed before the AI and the rejection of the application for EoT No. 2A cannot be said to be a factor indicating unconscionable conduct on the part of the Defendant when it made the call on the PB. 47 - Application for EoT No. 3 [60] This application by the Plaintiff vide letter dated 23.1.2019 was made pursuant to Clause 23.1(b) of the Contract and premised on the broad grounds relating to –

the suspension of works by the Plaintiff for 53 days pursuant to Clause 30.7. The Plaintiff alleged that works have resumed at the Defendant’s request in order to generate cash flow to the Project by way of billing collection and that it is a condition that the date of resumption of works shall not be the basis for evaluation of EoT. Instead the EoT shall be granted accordingly upon full settlement of all outstanding payments towards the Certificates of Payment up to and including No. 40 and/ or the optional work programme adopted by the Defendant, whichever is later; and

delay in payment where the Plaintiff enclosed 10 letters spanning from 25.6.2018 to 1.11.2018 surrounding this issue. In the letter 48 dated 15.10.2018, the Plaintiff contended that Certificates Nos. 30, 31, 33 to 37 were due for payment since January 2018 and the cumulated amount due as at 12.10.2018 is RM5,791,677.23. [61] The Architect replied to this application on 13.2.2019 by stating that: “ … Based on the above letters we are assuming that you are applying for an extension of time in accordance with clause 23.8(v) of the Relevant Events – suspension of the Contractor of his obligations under Clauses 30.7. You have confirmed that you have returned your work via your letter … dated 24 December 2018, however in your letter … dated 23 January 2019, you have implied that the date of your resumption of work cannot be used to determine the extension of time for the suspension, on the ground that you have resumed works at the request of the Client. Please note that there is no such condition provided in the contract. 49 If you are in agreement with us that you have already resumed works in accordance with the contract, please submit a record of your daily site activities for the month of November 2018 for our assessment of the duration of your suspension of work. Having said the above, although you are applying for an extension of time under suspension of work clause, it seems from your attached copies of correspondence, your application is more directly related to the long outstanding payments rather than to your recent short period of suspension which you have already resumed anyway. As you are aware there is no ground to claim for an extension of tie for outstanding payments under Clause 23.8 of the Relevant Events. Further to your previous discussions with the Client, we understand that you have submitted three options of Work Programmes with various completion dates and cash flows for their consideration which we believe you are still renewing 50 with them. In our opinion, resolving the financial arrangement with the Client is most critical as it would have a direct implication on the new completion dates rather than the short period of suspension of work which in this case is not on a critical path. …”. [62] The Plaintiff disagreed with the Architect’s stance and in the reply dated 28.2.2019 to the Architect, the Plaintiff reiterated that the application for EoT No. 3 is premised on the suspension of works pursuant to Clause 23.8(v) and acts of prevention or breach of contract by the Defendant pursuant to Clause 23.8(m) of the Contract arising from the Defendant’s defaults in payment of certified sums. According to the Plaintiff, the certified sum of RM6,901,055.20 remained due and owing under Interim Certificates No. 34 to 38. [63] The Architect responded on 12.3.2019 by stating that it was puzzled by the Plaintiff’s justification in claiming for an EoT for suspension of 51 works as this would imply that the activities required for the said suspension would have been carried out much earlier from the official date of the suspension on 5.11.2018. [64] On 22.3.2019, the Plaintiff wrote to assert that, vide the notice of suspension dated 18.9.2018, it had given ample time to the Defendant to satisfy the outstanding payments before exercising its right to suspend the works. The Plaintiff implored the Architect to reconsider the application for EoT No. 3 since all parties were aware of the long outstanding payments of certified sums by the Defendant which led to the suspension of works. [65] For ease of reference, Clause 30.7 of the Contract provides that: “Without prejudice to the Contractor’s right to determine his own employment under Clause 26.0, if the Employer fails or neglects to pay the Contractor the amount due as shown in the payment certificate (less any Liquidate Damages and set-off which the Employer is expressly entitled to make under the 52 Contract) and continue such default for fourteen (14) Days from the receipt of a written notice delivered by hand or by registered post from the Contractor stating that if payment is not made within fourteen (14) Days, the Contractor may by a further written notice delivered by hand or registered post, forthwith suspend the execution of the Works until such time payment is made. Provided always that such notice shall not be given unreasonably or vexatiously.”. [66] Mr. Michael Koh argued that the Plaintiff’s entitlement to EoT for the suspension of works is premised on Clause 23.8(v) and the duration would only entail the time which commensurate with the actual number of days that works was suspended. Despite the period of suspension being only approximately 53 days, the Plaintiff claimed an exorbitant 679 days. Therefore, the Architect had correctly rejected the application for EoT but the Plaintiff refused to accept the Architect’s assessment and insisted that the Architect calculate the number of days based on the full settlement of the outstanding amounts due to 53 the Plaintiff. The Defendant submitted that there is no proof of the Architect acting in bad faith. [67] On the issue of late payment, the Defendant’s counsel referred to a passage at p 741 in The PAM 2006 Standard Form of Building Contract (supra) in submitting that the Contract does not provide that the Plaintiff is entitled to slow-down or decelerate works if it has not been paid. However, in fairness to the Plaintiff, I think the earlier explanation at p 740 in the said textbook is equally relevant to the issue at hand viz.: “The employer may default in honouring the Interim Certificate in a number of ways namely, by delaying or deferring payment of either the whole or part of the certified payment or failing to pay at all the whole part of the certified payment without reasonable cause. The defaults above are distinct from the situations where the employer refuses to honour a certificate on bona fide grounds, ie challenging the validity of the certificate itself. It is trite law that the failure of the employer to 54 pay the certified sums due within the honouring period stipulated in the contract without reasonable cause is a breach of contract on his part (see Moschi v Lep Air Services [1972] 2 AII ER 393). In addition to the applicable common law rights, the contract itself may prescribe a number of remedies that can be available to the contractor consequent to the employer’s breach of the honouring obligation. Under the PAM Contract 2006, the contractor is entitled to, in addition to the unpaid certified amount to pursue the following remedies …:

(A) to suspend the execution of the Works under Clause 30.7 until such time payment is made;

(B) to determine his own employment under Clause 26.0;

(C) to claim interest on the unpaid amount under Clause 30.17 Although the express remedies available to the contractor under the PAM Contract 2006 are much wider than most of the contemporary forms used in the country, it nevertheless 55 does not entitle the contractor to slow-down or reduce the rate of executing work (see Kah Seng Construction Sdn Bhd v Selsin Development Sdn Bhd [1997] 1 CLJ Supp 448); he has to suspend the execution of the works completely.”. [68] The Defendant additionally emphasised that the Plaintiff has a duty to proceed with the works diligently under Clause 23.6 read together with Clause 25.1(c) of the Contract. Reliance was placed on the authority of Supamarl Ltd v Federated Homes Lrd [1981] 9 ConLR 25 in submitting that, by slowing down works in express breach of a duty to proceed diligently with works, is a repudiatory breach. [69] In sum, the Defendant takes the position that the Plaintiff cannot rely on late payments to entitle the Plaintiff to slow down the performance of works and claim for EoT. Assuming that the Plaintiff was entitled to EoT, it would only be for the period that it had suspended works between 5.11.2018 and 24.12.2018, but this period was rejected by the Plaintiff itself. 56 [70] The attention of the Court was drawn to the payment record as at 13.11.2019 as tabulated in para 13 of the AIS which shows that payments have been made in respect of Claim Nos. 30 to 45 whilst payment for Claim No. 46 was due only on 8.11.2019 (payment vouchers and bank statements from August 2015 to September 2019 were exhibited). In para 47 of the AIR, the Defendant admitted that the payments were late, however all Certificates Nos. 1 to 45 have since been paid. Thus, the fact that the Defendant has paid all that is due to the Plaintiff up until 11.10.2019 is clearly established but on 15.10.2019, the Plaintiff stopped the works. [71] From a perusal of the numerous correspondence and other documents as exhibited in the affidavits, it is evident that the issues arising as a result of the dispute between the parties, among others, as to whether the fault for the delay in the Project lies with the Plaintiff or the Defendant; the Plaintiff’s entitlement to an EoT; and the validity of the determination of the Plaintiff’s employment by the Defendant (where apart from the issues discussed earlier, the late issuance of the AI and approval of the VO; the determination of P&M as the sub-contractor 57 for the Project; the alleged acts of prevention by the Defendant; change in the format of certification; and the purported failure by the Architect to act fairly and impartially were among the matters raised in the communication between the parties) are highly contested and must be determined in a full trial. In these circumstances, it is not misplaced for the Defendant to rely on the decision of the High Court in Daya CMT (supra) where it was held, inter alia, that: “[69] As can be seen, the Plaintiff's entitlement to extension of time is something for the Plaintiff to prove and not a given as is clear from the qualification in the words "(if any)". In as much as the Plaintiff may put in fresh application for EOT, the Consultants are not required to re-assess it especially if no fresh grounds are canvassed. All that the Consultants have said is that if the application is based on the same reason, then what they have decided stands. There is nothing unconscionable about that. … 58 [72] The Plaintiff by its letter of 8 April 2013 admitted the delay was due to the non-performance of its subcontractor, Million Aim Sdn Bhd and agreed to replace the subcontractor with another. Such disputes on extension of time and the number of days of entitlement are a fertile area of conflict in a construction contract and in the absence of cogent evidence of unconscionability in rejecting the EOT application or in giving less than what is reasonably applied for, this Court would not at this stage conclude that a strong prima facie case of unconscionability has been made out. Whether or not an EOT application should have been granted and if so for how long, would be a matter for trial. At this stage even if an EOT application has not been considered reasonably or has been rejected unreasonably, that does not, in the absence of some egregious element, amount to an unconscionable conduct.”. 59 (emphasis added) [72] Similarly in the case of JK Integrated (supra) the Singapore High Court rejected the application for an injunction because, among others, it was open to the plaintiff in that case to challenge the architect’s decision in arbitration and at best, casting aside the merits of the allegations hurled against the first defendant, all that the plaintiff had shown was that “… there were genuine disputes to be tried as to which party bore the contractual responsibility for the delays.”. [73] During the hearing of the application, Mr. Ekbal Singh submitted that the facts in Daya CMT can be distinguished. When pressed further by the Court, learned counsel was not able to articulate as to the basis for his submission. [74] At the time of writing this judgment, the Court had already allowed the Defendant’s application for a stay of proceedings pending reference of the dispute to arbitration with costs of RM5,000.00 to be paid by the 60 Plaintiff to the Defendant, subject to allocator. This order was made on 29.7.2020. [75] Taking the Plaintiff’s case at its highest, it can certainly be concluded that disputes are aplenty and these tantamount to triable issues which may, in the end, result in a finding of breach of contract by either or both parties. The mere fact that there is a retention sum, does not mean that the call on the PB was unconscionable. Looking at the Plaintiff’s application in its totality, I am unable to conclude that the Plaintiff has provided sufficient evidence to enable the Court to be satisfied that there is a strong, prima facie case of unconscionability to an extent that is sufficient for the Court to be minded to order the injunction as sought. [76] In the absence of unconscionable conduct on the part of the Defendant, this Court would not restrain the call made on the PB as to do so would strip the PB of its efficaciousness and purpose of the insertion of a provision on the PB in the LoA and the Contract in the 61 first place (see Bella Builders Sdn Bhd v. Kerajaan Malaysia & Anor [2017] 1 LNS 558).

(B) Non-disclosure of the winding up petition against the Plaintiff [77] In paras 64 and 65 of its AIR, the Defendant averred that the Plaintiff failed to comply with the obligation to make full and frank disclosure of information which could prevent the order being made at the ex-parte hearing of encl. 4, namely the fact that on 4.11.2019, Companies (Winding Up) Petition No. BA-28NCC-711-11/2019 was filed by the solicitors acting for Kumpulan A Besik Sdn Bhd at the Shah Alam High Court premised on an order made by the Court dated 21.3.2019 naming the Plaintiff as the respondent. The Defendant contended that the Plaintiff has deliberately withheld this information from the Court to avoid scrutiny as to its impecunious financial state. The undertaking given by the Plaintiff as to damages thus has little value as the Plaintiff may not be able to compensate the Defendant for damages it has incurred as a result of the ex-parte injunction. 62 [78] The Plaintiff sought to defend its action of filing the cause papers in court on an urgent basis and affirmed in its AIR that any omission to comply with the duty of full and frank disclosure was inadvertent and unintentional due to the constraints of time. It was also averred that the information on the winding up petition is not material and the Plaintiff is not impecunious as alleged by the Defendant. In any event, the Defendant is holding the retention sum of RM10 million. [79] The first question posed by the Court when this case was called up for hearing was whether the Plaintiff had been wound up as this would naturally have bearing to the present proceedings. According to the Defendant’s solicitors who happens to represent one of the petitioning creditors, the winding up petition has yet to be heard at the Shah Alam High Court. [80] Now, O. 29, r. 1(2A)(e) of the RoC 2012 clearly provides that the AIS of an application made ex-parte must contain a clear and concise 63 statement of, among others, any facts which may lead the Court not to grant the application ex-parte or at all. [81] The basic principle that governs full and frank disclosure in an ex parte application is that the party applying for such order must disclose material fact that the Judge hearing the application need to know that may persuade the Judge to grant or not to grant the ex parte application order sought. The applicant has a special duty to disclose all matters within his knowledge which are material to the proceedings and are, or may be, in favour of an absent party. A matter regarded as material is a factor that the Court will take into account in the exercise of its discretion. The materiality of the facts to be disclosed is a matter for the Court to decide and not what the applicant or his legal advisers think to be material: see Kosma Palm Oil Mill Sdn Bhd v. Koperasi Serbausaha Makmur Bhd [2004] 1 MLJ 316 where the Court of Appeal referred to, inter alia, the judgment in Siporex Trade SA v Comdel Commodities Ltd [1986] 2 Lloyd’s Law Rep 428; Malaysian Merchant Marine Berhad & Ors V BHLB Trustee Berhad & Ors [2010] MLJU 1171 citing the decisions in Brink’s-MAT Ltd v Elcombe and Others [1988] 3 64 All ER 188 and Castle Fitness Consultancy Pte Ltd v Manz [1990] 1 MLJ 141; and MRA International Sdn Bhd v SPC Diatech LLC [2018] MLJU 107. [82] Applying these trite legal principles to the current factual scenario, it is my considered view that the Plaintiff should have disclosed the fact regarding the winding up petition against it in the AIS. Whether that fact is relevant or a non-issue in so far as the application which was heard on 26.12.2019 is concerned is for the Court, and not the Plaintiff, to determine.

(C) Balance of Convenience [83] It is settled law that in this country, a principal who applies for an injunction to restrain a beneficiary from making a call under a performance bond and/ or from receiving monies thereunder is still required to satisfy the test as propounded in American Cyanamid Co v Ethicon Ltd [1975] AC 396 and adopted in Keet Gerald Francis Noel 65 John v Mohd Noor @ Harun b Abdullah & 2 Ors [1995] 1 AMR 373. This test requires the Court to consider whether there is a serious issue to be tried; where the balance of convenience lies; and whether damages would be an adequate remedy (see the Supreme Court decision in Esso Petroleum (supra) and Law And Practice Of Injunctions In Malaysia (supra, at pp 383 - 384). [84] The Plaintiff contended that the balance of convenience tilts in its favour as there are serious issues to be tried particularly as to whether the termination of the Contract by the Defendant is valid or otherwise. The need to preserve the status quo until the disposal of the suit and to avoid greater loss to the Plaintiff were also emphasised. [85] On the other hand, the Defendant submitted that no injunction should be granted because the balance of convenience lies in its favour on the grounds that –

the Defendant is entitled to call on the PB following the determination of the Contract due to the Plaintiff’s failure to 66 regularise its works particularly when the Plaintiff caused works to be delayed far beyond the completion date and workers even went to the extent of barricading the work site and removing construction materials from the site;

none of the allegations of unconscionability by the Plaintiff is sustainable or can be said to be unfair, oppressive or particularly malodorous so as to warrant intervention from this Court; and

the Bank Guarantee expires on 4.4.2020 and if the Defendant is prevented from calling on the PB, it would suffer irreparable damage given the Plaintiff’s financial state and likelihood of being wound up. The Defendant has a duty to the purchasers of the residential properties to complete the Project. Besides, the constant change of solicitors representing the Plaintiff did not help to expedite matters. [86] After giving due consideration to the arguments put forth by each party, and in view of the finding by this Court that the Plaintiff has not 67 demonstrated lack of bona fides in the Defendant showing that it had acted unreasonably and there being some evidence indicating delay in the execution of the works which is attributable to the Plaintiff, the Court was inclined to accept the Defendant’s grounds in concluding that the balance of convenience lies in favour of disallowing the order for an injunction. Conclusion [87] The principle underlying the unconscionable doctrine is to prevent abuse, oppression and unfair conduct. For all the reasons as above stated, the present case is not one that falls within the category of cases where the discretion of the Court should be exercised in favor of the Plaintiff. Therefore, the application in encl. 4 was accordingly dismissed. [88] On the issue of costs, the Defendant’s solicitors prayed for RM30,000.00 since they had filed five bundles of documents although there was only one affidavit as opposed to the three affidavits afirmed by the Plaintif. The Plaintiffs counsel submitted that the said amount asked is exorbitant and suggested RM5,000.00 instead. The Court then ordered that costs of RM10,000.00 be paid by the Plaintif to the Defendant, subject to allocator. Dated: 16 December 2020 m (ALIZA SULAIMAN) Judge Construction Court2 High Court Kuala Lumpur Counsels/ Solicitors: For the Plaintiff Ekbal Singh Sandhu Messrs. John Yong & Irene Song Advocates & Solicitors No. 21-2, Jalan Puteri 2/6 Bandar Puteri 47100 Puchong Selangor 68 69 For the Defendant: Michael Koh Boon Han Messrs. Zul Rafique & Partners Advocates & Solicitors D3-3-8, Solaris Dutamas No. 1, Jalan Dutamas 1 50480 Kuala Lumpur Cases referred to: AFS Engineering (M) Sdn Bhd v MRCB Builders Sdn Bhd [2020] MLJU 2118 Albilt Resources Sdn Bhd v Casaria Construction Sdn Bhd [2010] 3 MLJ 656 American Cyanamid Co v Ethicon Ltd [1975] AC 396 Bella Builders Sdn Bhd v. Kerajaan Malaysia & Anor [2017] 1 LNS 558 Bhaskaran a/l Thiruppuvanam v Ong Chong Realty Sdn Bhd & Anor [2017] MLJU 644 Brink’s-MAT Ltd v Elcombe and Others [1988] 3 All ER 188 BS Mount Sophia Pte Ltd v Join-Aim Pte Ltd [2012] 3 SLR 352 Castle Fitness Consultancy Pte Ltd v Manz [1990] 1 MLJ 141 70 Daya CMT Sdn Bhd v. Yuk Tung Construction Sdn Bhd [2016] 1 LNS 649 Drico Ltd v Drico (Water-Specialist) Sdn Bhd & Ors [2009] MLJU 1665 Dunggon Jaya Sdn Bhd v Aeropod Sdn Bhd & Anor (and Another Appeal) [2019] 2 SSLR 339 Esso Petroleum Malaysia Inc v Kago Petroleum Sdn Bhd [1995] 1 AMR 189 Focal Asia Sdn Bhd & Anor v Raja Noraini binti Raja Datuk Nong Chik & Anor [2011] 2 AMR 515 Gumusut-Kakap Semi-Floating Production System (L) Ltd v Sabah Shell Petroleum Co Ltd [2017] MLJU 877 Harbottle (RD) (Mercantile) v National Westminster Bank [1978] QB 146 He-Con Sdn Bhd v. Bulyah Ishak & Anor And Another Appeal [2020] 7 CLJ 271 Innotec Asia Pacific Sdn Bhd v Innotec GmbH (and Another Suit) [2007] 3 AMR 67 Inter Maritime Management Sdn Bhd v Kai Tai Timber Co Ltd, Hong Kong [1995] 1 MLJ 322 71 Jagdis Singh Banta Singh v. Outlet Rank (M) Sdn Bhd [2013] 3 CLJ 47 Jeks Engineering Sdn Bhd v Pali PTP Sdn Bhd [2019] 1 LNS 1392 JK Integrated (Pte Ltd) v 50 Robinson Pte Ltd and another [2015] SGHC 57 Kah Seng Construction Sdn. Bhd. v. Selsin Development Sdn. Bhd. [1997] 1 CLJ Supp 448 Keet Gerald Francis Francis Noel John v Mohd Noor @ Harun b Abdullah & 2 Ors [1995] 1 AMR 373 Kejuruteraan Bintai Kindenko Sdn Bhd v. Nam Fatt Construction Sdn Bhd & Anor [2011] 2 AMCR 461 Kosma Palm Oil Mill Sdn Bhd v. Koperasi Serbausaha Makmur Bhd [2004] 1 MLJ 316 Lembaga Pelabuhan Kelang v. Kuala Dimensi Sdn Bhd & Another Appeal [2010] 9 CLJ 532 Malaysian Merchant Marine Berhad & Ors v BHLB Trustee Berhad & Ors [2010] MLJU 1171 Ming Ann Holdings Sdn Bhd v. Danaharta Urus Sdn Bhd [2002] 3 CLJ 380 72 MRA International Sdn Bhd v SPC Diatech, LLC [2018] MLJU 107 Press Metal Sarawak Sdn Bhd v Etiqa Takaful Bhd [2016] 5 MLJ 417 Seloga Jaya Sdn Bhd v Pembenaan Keng Ting (Sabah) Sdn Bhd [1994] 2 MLJ 97 Sinohydro Corporation (M) Sdn Bhd v Golden Horse Rubber Sdn Bhd [2020] 4 MLRH 685 Siporex Trade SA v Comdel Commodities Ltd [1986] 2 Lloyd’s Law Rep 428 Sumatec Engineering and Construction Sdn Bhd v Malaysian Refining Co Sdn Bhd [2012] 2 AMR 673 Sunway Damansara Sdn Bhd v Malaysia National Insurance Bhd & Anor [2008] 3 MLJ 872 Supamarl Ltd v Federated Homes Ltd [1981] 9 ConLR 25 Target Resources Sdn Bhd v THP Bina Sdn Bhd [2019] 4 MLRA 594 Zaidin Abd Ghani @ Zaidin Stothard V Raja Raman Nair @ Mohd Yusof & Ors [2001] MLJU 227 73 Legislation referred to: Rules of Court 2012, O. 29 r. 1 & O. 92, r. Other source(s) referred to: Construction Law in Malaysia, Datuk Sundra Rajoo and Ir Harbans Singh KS, Sweet & Maxwell Asia, 2012 Law and Practice of Injunctions in Malaysia, General Editor Robert Lazar and a team of expert contributors, Sweet & Maxwell, 2020 The PAM 2006 Standard Form of Building Contract, Sundra Rajoo, Dato’ WSW Davidson and Ir Harbans Singh KS, Lexis Nexis, 2010