Puncak Gali Harmoni Sdn Bhd v Emrail Sdn Bhd (BA-24NCC(ARB)-7-09/2025)

This judgment concerns the Plaintiff’s application in Enclosure 3 for interim injunctive relief pending the disposal of the Originating Summons and the dispute resolution process said to arise under the parties’ contractual arrangements, namely mediation and arbitration. The application is of considerable significance. It engages the Court’s interlocutory equitable jurisdiction in the context of a commercial dispute that is said by both parties to be connected with a major railway rehabilitation project of public importance.

The matter now returns to this Court following the decision of the Court of Appeal dated 10.04.2026, which set aside the earlier High Court orders, reinstated the suit, remitted the Originating Summons and the application for interim injunction to the Shah Alam High Court before another Judge or Judicial Commissioner, directed that the inter partes injunction application be fixed within two weeks and disposed of expeditiously, and ordered that the interim protection granted earlier remain in force until the disposal of the inter partes hearing.

I have read the Originating Summons, the Notice of Application, the Plaintiff’s Affidavit in Support, the Plaintiff’s Further Affidavit, the Defendant’s Affidavit in Reply, the Plaintiff’s Affidavit in Reply, the written submissions and the bundles of authorities filed on behalf of both parties. These Grounds are confined to the merits of Enclosure 3 and the materials relied upon for that purpose.

The Plaintiff’s case, shortly put, is that the Defendant issued to it a Letter of Award dated 29.05.2025 and later a Letter of Undertaking dated 29.08.2025 in relation to subcontract works for the project. The Plaintiff says these documents, together with the parties’ subsequent conduct, created binding or at least sufficiently operative rights that ought to be protected pending final determination. The Plaintiff complains that unless the Defendant is restrained, the Defendant will terminate or sidestep the S/N Ki48OQo6GEmnqauiJ5Nfug arrangement, appoint others, and thereby destroy the subject matter of the intended mediation and/or arbitration.

The Defendant’s case is that the documents relied on are conditional, incomplete and not specifically enforceable; that the Plaintiff’s true remedy, if any, lies in damages; and that the broad injunction sought would in substance interfere with an ongoing Government-related infrastructure project. The Defendant therefore contends that there is neither legal nor discretionary basis for interim relief.

The Court is not at this stage deciding who will ultimately succeed. Nor is the Court making final findings on the enforceability of the Letter of Award or the Letter of Undertaking. The question is whether, applying orthodox principles governing interlocutory injunctions, the Plaintiff has established a proper case for the continuation or grant of interim equitable restraint.

The dispute concerns works connected to “Package C Restoration of Track and Slope Stabilisation Track Rehabilitation and Associated Works due to Major Flood between Gua Musang and Tumpat Railway Station, Kelantan”. The Plaintiff says that the Defendant awarded to it the subcontract works through the Letter of Award dated 29.05.2025, and that the position was S/N Ki48OQo6GEmnqauiJ5Nfug subsequently reinforced by the Letter of Undertaking dated 29.08.2025. According to the Plaintiff, this was not a mere preliminary commercial conversation, but a real operational arrangement under which the Plaintiff was intended to be the effective subcontractor for substantial project works.

The Plaintiff’s affidavit materials go further. The Plaintiff says the arrangement is evidenced not only by the documents themselves but by meetings, WhatsApp communications, financing discussions, and other conduct of the parties. The Plaintiff also refers to sums of RM300,000, RM600,000, and RM630,000 said to have been paid or advanced in connection with the relationship and the project. The Plaintiff says these matters show that the parties had moved beyond an unenforceable understanding into a live commercial arrangement which the Defendant itself recognised.

The Defendant disputes that narrative. It says that the Letter of Award was expressly subject to conditions, including the award and finalisation of the main contract, confirmation of subcontract price, execution of further documentation, and matters relating to project structure. The Defendant says the Letter of Undertaking must be read in the same conditional framework and cannot, standing alone or together with the Letter of Award, produce a concluded and specifically enforceable contract.

There is also a background issue concerning judicial management proceedings involving the Defendant. The Plaintiff’s affidavit in reply explains that the OS and injunction were filed urgently because there was a real and imminent danger that the Defendant would undermine or destroy the subject matter of the dispute, and that nunc pro tunc leave was or would be pursued in the related proceedings. The Plaintiff says the judicial management position was not concealed from the Court at the ex parte stage.

For present purposes, I am satisfied that the application is properly before this Court for determination on the merits. The Court of Appeal has remitted the injunction application for that purpose. The present task is therefore to apply the settled interlocutory principles to the dispute disclosed in the affidavits and submissions.

It is important to identify the practical content of the relief sought. The Plaintiff seeks, in substance, orders restraining the Defendant from acting inconsistently with the Letter of Award and the Letter of Undertaking, from appointing or dealing with others in relation to the same subcontract works, and from taking steps said to undermine the Plaintiff’s rights pending final resolution. The Plaintiff’s case is that unless such orders are granted, the Defendant may terminate or bypass the Plaintiff, involve third S/N Ki48OQo6GEmnqauiJ5Nfug parties, and thereby permanently alter or destroy the substratum of the dispute.

These are not narrow or neutral orders. They go to the operational freedom of the Defendant in relation to a live project. Whether one characterises the relief as preservatory or not, its practical effect is potentially extensive. This is highly relevant to the discretionary analysis that follows.

In my judgment, the following issues arise for determination:

whether the Plaintiff has shown a bona fide serious issue to be tried;

whether damages would be an adequate remedy;

whether there remains a status quo or substratum apt for preservation by injunction;

where the balance of convenience lies;

whether public interest is material to the exercise of discretion; and

whether any narrower interim order ought nevertheless to be granted.

The Plaintiff places primary reliance on Keet Gerald Francis Noel John v Mohd Noor bin Abdullah & Ors [1995] 1 MLJ 193. and Interstate M & E Sdn Bhd & Ors v Fore-Sight Trading Sdn Bhd & Ors [2007] 6 MLJ 677. These authorities remain the proper starting point. They affirm that the Court must first ask whether there is a serious issue to be tried. If that threshold is satisfied, the Court then considers where the justice of the case lies, including the adequacy of damages, balance of convenience, preservation of the status quo, and any special factors that may bear on the equitable discretion.

The importance of Keet Gerald lies not merely in the phrase “serious issue to be tried”, but in the discipline it imposes upon interlocutory adjudication. The Court is not to conduct a mini-trial. It is not to decide finally the correctness of one side’s contractual interpretation or factual narrative. Yet, the Court is not mechanically to grant injunctions upon the mere assertion of a dispute. The dispute must be real, substantial and fit for investigation, and once that threshold is crossed, the Court must still weigh practical justice. That is the essence of the case.

Likewise, Interstate M & E is significant because it illustrates that interlocutory relief is not granted in isolation from the realities of the case. Even where the threshold issue is satisfied, the Court must ask where injustice would more likely lie during the interim period. It is therefore no answer for the Plaintiff simply to say that because triable issues exist, an injunction must follow. The discretionary balance remains central. AV Asia and Arbitration Act relief

The Defendant relies on AV Asia Sdn Bhd v Measat Broadcast Network Systems Sdn Bhd [2014] 1 CLJ 821. I accept the Defendant’s submission that this authority is apposite for the proposition that an injunction sought in aid of arbitration under section 11 of the Arbitration Act 2005 does not form a separate or diluted category of relief. The Court’s power remains equitable and must be exercised consistently with settled injunction principles.

This is important because part of the Plaintiff’s case is framed in terms of preserving the efficacy of mediation and arbitration. That is, of course, a relevant consideration. But AV Asia makes clear that invoking arbitration does not relieve the Plaintiff of the need to show why interlocutory relief is justified. Arbitration is a forum for final determination of rights. Interim relief in aid of arbitration must still be shown to be necessary and just. S/N Ki48OQo6GEmnqauiJ5Nfug Specific enforceability authorities

The Defendant further relies on Wisma Sime Darby Sdn Bhd v Wilson Parking (M) Sdn Bhd [1996] 2 MLJ 81, Kalimuthu v S Kandiah [1976] 2 MLJ 217, Goo Seow Chai v Amalan Tepat Sdn Bhd [2007] 8 MLJ 259, , and I-Expo Sdn Bhd v TNB Engineering Corporation Sdn Bhd [2014] 1 LNS 1487. These authorities are invoked to support the proposition that incomplete, uncertain or conditional arrangements are not specifically enforceable and therefore cannot ordinarily ground injunctive relief under section 54(f) of the Specific Relief Act 1950.

The value of those authorities at this stage is not that they conclusively decide the present dispute. They do not. But they do underline an important point: the stronger the appearance that the underlying arrangement is conditional, incomplete or not apt for specific enforcement, the weaker the equitable case for an interlocutory injunction that would, in substance, preserve or compel its performance. This is because equity should not, under the guise of preservation, effectively order interim specific performance of a bargain whose enforceability remains seriously doubtful. S/N Ki48OQo6GEmnqauiJ5Nfug Public law and public interest authorities

The Defendant also relies on Tan Bun Teet & Ors v Menteri Sains, Teknologi Dan Inovasi Malaysia & Ors [2013] 3 CLJ 1115 and Dhaya Maju LTAT Sdn Bhd v Kerajaan Malaysia & Anor [2021] 2 CLJ 897. The proposition drawn from those authorities is that the Court should be cautious about granting relief whose practical effect is to interfere with Government functions, Government contracts, or public administration.

The present case is not identical to those authorities. The Plaintiff is not suing the Government directly. But the principle of caution remains relevant. If the injunction sought would in practice impede or complicate the implementation of a public infrastructure project, that practical consequence is a proper factor in the exercise of the Court’s equitable discretion. “Nothing left to preserve” authorities

The Defendant further cites People Realty Sdn Bhd v Red Rock Construction Sdn Bhd [2008] 1 CLJ 632, Ngu Eng Hua & Ors v Naslei Enterprise Sdn Bhd & Ors [2009] 8 CLJ 726, and Mohd Latiff Shah Mord & 2 Ors v Tengku Abdullah Ibni Sultan Abu Bakar & 5 Ors [2009] 11 MLRH 774. The broad theme of these authorities is that interlocutory injunctions are preservatory. Where the status quo or substratum is no longer capable of preservation S/N Ki48OQo6GEmnqauiJ5Nfug in any meaningful sense, the rationale for interlocutory relief weakens significantly.

Again, these cases do not mechanically dictate the result. But they do remind the Court that equity is not to be used to rewind completed events or to grant final-type advantages on an interim basis where the practical substratum has altered.

Applying the foregoing principles, I am satisfied that the Plaintiff has crossed the threshold of showing a serious issue to be tried.

The Plaintiff relies on identified contractual documents: the Letter of Award and the Letter of Undertaking. It also relies on detailed factual material concerning the parties’ dealings, meetings, WhatsApp exchanges, financing arrangements, and operational conduct. The Plaintiff’s affidavit in reply is not a bare denial. It positively advances a factual narrative aimed at showing that the Defendant itself recognised the arrangement and acted consistently with it.

There are genuine disputes as to whether the conditions in the Letter of Award were fulfilled, waived, accepted, or rendered spent by subsequent conduct. There are also arguable issues as to whether the Defendant can rely on incompleteness or S/N Ki48OQo6GEmnqauiJ5Nfug conditionality where the Plaintiff says the Defendant itself benefited from the arrangement and took steps consistent with its existence. These are not trivial or contrived issues. They are proper matters for fuller adjudication.

The Plaintiff also raises a real issue as to the role and effect of the Letter of Undertaking. If, as the Plaintiff contends, that undertaking was intended to be binding on the Defendant and its successors or permitted assigns, that may materially affect the rights and obligations between the parties. Whether that contention is correct is not for present decision; but it is plainly arguable.

I therefore hold that the Plaintiff has established a bona fide serious issue to be tried.

The fact that the Plaintiff has crossed the threshold does not conclude the matter. The Court must still examine whether damages are an adequate remedy.

The Plaintiff says damages are inadequate because the subject matter of the dispute will be destroyed if the Defendant proceeds without restraint. Once the Defendant appoints others or acts inconsistently with the Letter of Award and Letter of Undertaking, S/N Ki48OQo6GEmnqauiJ5Nfug the Plaintiff says the mediation and arbitration process will become hollow. The Plaintiff also relies on its undertaking as to damages.

I am unable to accept that submission in full. The Plaintiff’s asserted loss is fundamentally commercial. It says it has lost or will lose the benefit of the subcontract arrangement, monies advanced, and commercial opportunity connected to the project. Those losses are, in principle, capable of monetary assessment. The Plaintiff itself treats significant parts of the dispute in monetary terms, including the sums of RM300,000, RM600,000 and RM630,000 referred to in its materials.

It is true that a commercial opportunity may sometimes have qualities not easily reduced to money. But difficulty of assessment is not the same as inadequacy of remedy. Even if the Defendant is ultimately found to have wrongfully repudiated or undermined the arrangement, the Plaintiff’s right to seek damages or other monetary relief would remain. What may be lost is the opportunity to perform the project in specie. That, by itself, does not automatically justify interlocutory relief, especially where the underlying contractual entitlement remains seriously disputed.

By contrast, the prejudice asserted by the Defendant from a broad continuing injunction is more immediate in character. Even without relying on Enclosure 94, the Defendant’s existing submissions make clear that the project is one of public significance and that S/N Ki48OQo6GEmnqauiJ5Nfug project implementation, contractor freedom of action, and public interest are said to be engaged. That operational prejudice is not illusory.

In the result, I find that the adequacy-of-damages factor does not favour the Plaintiff.

The Plaintiff frames its case as one of preserving the status quo pending final resolution. But it is necessary to ask: what exactly is the status quo that the Court is being asked to preserve?

The Plaintiff’s answer is that the status quo is the subsisting effect of the Letter of Award and the Letter of Undertaking, coupled with the Defendant’s obligation not to bypass the Plaintiff before mediation and/or arbitration concludes. That formulation, however, already assumes much of what is in dispute. Whether those documents are binding in the manner asserted by the Plaintiff is a major substantive issue.

The injunction sought is therefore not neutral in character. It would restrain the Defendant from acting inconsistently with the Plaintiff’s asserted rights in relation to a live project. In practical terms, granting the injunction would require the Defendant, pending final determination, to conduct itself as though the Plaintiff’s contractual S/N Ki48OQo6GEmnqauiJ5Nfug case had sufficient operative force to warrant immediate equitable protection. That comes very close to interim specific performance.

The Court must be slow to grant such relief where the foundational rights are disputed and where the practical consequences are substantial. The broader the injunction, the greater the risk that the Court, under the language of preservation, effectively grants a substantive advantage before trial.

In my judgment, the decisive factor is the balance of convenience.

On the Plaintiff’s side, refusal of the injunction means that the Defendant may continue to act in a manner inconsistent with the Plaintiff’s asserted subcontractual rights, with the consequence that the Plaintiff may lose the commercial benefit of participating in the project works. That is a real disadvantage.

On the Defendant’s side, grant of the injunction would impose substantial restraints on how the Defendant may proceed in relation to the project. It would affect project-related operational freedom and risk placing the Defendant in a position where, pending final determination, it is compelled to honour or preserve disputed arrangements. In a normal private dispute that may S/N Ki48OQo6GEmnqauiJ5Nfug already be a serious matter. Here, the context is said to be a public railway rehabilitation project, which heightens the Court’s concern.

I am also satisfied that the Court must pay close attention to the breadth of the Plaintiff’s prayers. These are not confined to preserving a fund or preventing dissipation of assets. They go to the continuing conduct of the project. The Court should be particularly cautious where the relief sought would significantly shape the parties’ working relationship before the legal basis of that relationship is finally determined.

Taking these matters together, I find that the balance of convenience favours refusal of the injunction.

Public interest is not an answer to every interlocutory claim, but it is a legitimate and weighty factor here.

The project concerns railway rehabilitation following major flood damage. The Court of Appeal expressly referred to the matter as a national project for the public’s benefit when directing its expeditious disposal. That appellate observation is not determinative of the merits of Enclosure 3, but it is highly relevant to the context in which this Court’s discretion must be exercised.

If the Court were dealing with an ordinary private construction dispute over a discrete asset, the balance may fall differently. But this is not such a case. The Court must be careful not to impose interlocutory restraints whose practical consequences extend beyond the private parties and into the performance of works said to be for public benefit.

The Plaintiff argues that its injunction is directed only at the Defendant and not at the Government or Ministry. Formally that is true. But equity looks to practical effect. If the practical effect of the order is to inhibit the Defendant’s ability to proceed in a way connected to a public infrastructure project, that is a matter the Court must weigh. I therefore regard public interest as reinforcing the conclusion already reached on the balance of convenience.

I have considered carefully whether, notwithstanding the refusal of the broad relief sought, some narrower interim order ought to be crafted.

In some cases, the Court can fashion a limited order preserving a fund, preserving evidence, or maintaining a neutral holding position without effectively deciding contested contractual rights. I do not consider this to be such a case.

The Plaintiff’s case is built around the proposition that the Letter of Award and Letter of Undertaking must be preserved in operation pending final determination. Any meaningful order in that direction would necessarily restrain the Defendant in a substantial way in relation to the project. It would not be a neutral holding measure. It would carry real substantive consequences.

In my judgment, there is no workable narrow order that would preserve the Plaintiff’s position without in substance granting part of the final relief sought. The proper course is therefore to refuse interlocutory injunctive relief and leave the parties to proceed to final determination on the merits.

Drawing all matters together, my conclusions are as follows:

the Plaintiff has shown that there are serious issues to be tried;

however, the Plaintiff has not demonstrated that damages would be inadequate in the circumstances of this case;

the relief sought is broad in scope and would risk conferring on the Plaintiff an interlocutory advantage akin to substantive relief;

the balance of convenience lies in favour of refusing the injunction;

public interest, in the context of an ongoing railway rehabilitation project said to be for public benefit, reinforces that conclusion; and

no narrower interim order can appropriately be fashioned without S/N Ki48OQo6GEmnqauiJ5Nfug effectively choosing sides on contested rights before final adjudication.

In the premises, although the Plaintiff’s claim is neither frivolous nor hopeless, it has not satisfied this Court that this is a proper case for the grant of interim injunctive relief in the terms sought in

Orders of the Court

For the foregoing reasons, the Court orders as follows:

Enclosure 3 is dismissed.

The interim protection that continued pursuant to the Court of Appeal’s order dated 10.04.2026 shall cease upon the disposal of this inter partes hearing, subject to any further order of the Court of Appeal or other court of competent jurisdiction.

For the avoidance of doubt, this ruling is confined to Enclosure 3 only. The Originating Summons in Enclosure 1 remains extant and shall proceed in accordance with further directions of the Court.

In view of the fact that the Plaintiff has shown arguable issue fit for determination but has failed in respect of interlocutory discretionary relief, I order costs in the cause.

Finally, I emphasise that nothing in these Grounds constitutes a final determination on the enforceability of the Letter of Award, the Letter of Undertaking, the Plaintiff’s final entitlement, or the Defendant’s ultimate defence. Those matters remain for final adjudication in the appropriate forum. Dated this 7th May 2026 -sgd- ………………………………….. Datin Asmah binti Musa Pesuruhjaya Kehakiman Mahkamah Tinggi Malaya Mahkamah Tinggi Shah Alam S/N Ki48OQo6GEmnqauiJ5Nfug Counsel for Plaintiff : Mr. Alvin Oh Seong Yew (Mr Sew Chang Peng, Ms Priscilla Faith Lim and Ms Jane Chan Siew Thung with him) Messrs Sia Siew Mun & Co Counsel for Defendant : Ms Ooi Suan Kim (Mr Boo Honn Chin with her)