Reliance Electro Mechanical Plumbing Contracting Co LLC (Sebuah syarikat yang diperbadankan di United Arab Emirates dengan No. Peti Surat: 52027) v Zelan Holdings (M) Sdn Bhd (WA-24NCC(ARB)-22-07/2023)

The matter before me raises a short point which has yet to be decided by the courts.

The plaintiff which is a foreign entity has filed an Originating Summons dated 03-07-2023 (Enclosure 1) [“OS”] for the recognition and enforcement of a foreign arbitration award.

The defendant a Malaysian company raised a preliminary objection that the plaintiff had failed to comply with the mandatory requirement under section 38(2)(b) of the Arbitration Act 2005 [“AA 2005”] by failing to exhibit in its application the original arbitration agreement or a duly certified copy of the agreement.

On 07-03-2025, after hearing from counsel, I had agreed with the defendant’s counsel Christopher Arun A/L Francis that there was indeed a fatal oversight by the plaintiff’s solicitors and dismissed the OS with costs of RM 20,000 subject to allocatur.

In my decision, I also stated for the record that I disallowed Enclosure 1 solely for non-compliance with section 38(2)(b) of AA 2005 and have not considered the merits of other arguments raised. S/N uionq3xDjUKweOaghWdBBg **Note : Serial number will be used to verify the originality of this document via eFILING portal 3

On 03-04-2025 the plaintiff has appealed to the Court of Appeal. These are my Grounds of Judgment.

Section 38(2)(b) of the AA 2005 reads as follows-

On an application in writing to the High Court, an award made in respect of an arbitration where the seat of arbitration is in Malaysia or an award from a foreign State shall, subject to this section and section 39 be recognised as binding and be enforced by entry as a judgment in terms of the award or by action.

In an application under subsection (1) the applicant shall produce-

the duly authenticated original award or a duly certified copy of the award; and

the original arbitration agreement or a duly certified copy of the agreement. [Emphasis added] [8] Compliance with section 38(2) of the AA 2005 is mandatory. In Tune Talk Sdn Bhd v Padda Gurtaj Singh [2020] 3 MLJ 184 CA [“Tune Talk”], Alizatul Khair JCA (delivering majority judgment of the court) said: S/N uionq3xDjUKweOaghWdBBg [81] As can be seen the only requirements under s 38(2) of the AA for the purposes of recognising and enforcing an arbitration award by entry as a judgment of the High Court are as follows: In an application under subsection (1) the applicant shall produce —

(a)the duly authenticated original award or a duly certified copy of the award; and

(b)the original arbitration agreement or a duly certified copy of the agreement. [82] The grounds upon which an arbitration award may be refused recognition and enforcement are set out in s 39(1). These grounds (nine altogether) as stated earlier are exhaustive. [83] The word ‘shall’ in s 38(1) of the AA is, as the word denotes, a mandatory requirement (see Low Cheng Soon v TA Securities Sdn Bhd [2003] 1 MLJ 389 and Yap Teck Ngian v Yap Hong Lang @ Yap Fong Mei & Ors [2006] 6 MLJ 607). [84] As the word ‘shall’ in s 38 of the AA denotes a mandatory requirement it therefore means that there is no room for the exercise of any discretionary power by the High Court if both substantive requirements in that section are fulfilled (which is the case here) and there are no grounds for refusal of recognition and enforcement under s 39 of the AA. [Emphasis added] S/N uionq3xDjUKweOaghWdBBg Issue [9] The sole issue before me therefore is – Did the plaintiff exhibit the original arbitration agreement or a duly certified copy of the arbitration agreement? The contentions of the plaintiff [10] The plaintiff counsel’s Peter Justin Skelchy contends in Enclosure 49 plaintiff’s reply submission that he had produced the certified true copy of the Subcontract Agreement. [11] He further contends that he need not produce the original or the duly certified copy of the Conditions of Subcontract [which contains the arbitration agreement clause] as clause 3 of the Subcontract Agreement “refers to and incorporates the entire Conditions of Subcontract as an integral part of the Subcontract Agreement”. [12] This is what counsel said:

At paragraphs 4 to 8 of the Defendant’s Submission, the Defendant raised a preliminary objection that the Plaintiff did not comply with the requirements under Section 38 of AA 2005, on the basis that the original / certified true copy of the Conditions of Subcontract was not exhibited in the Plaintiff’s affidavits.

With the greatest respect, it is submitted that the Defendant’s preliminary objection is misconceived. S/N uionq3xDjUKweOaghWdBBg

We wish to highlight that the certified true copy of the Subcontract Agreement is exhibited in the Plaintiff’s AIR No.2 as Exhibit Y, and Clause 3 therein refers to and incorporates the entire Conditions of Subcontract as an integral part of the Subcontract Agreement.

As the authenticity and contents of the Subcontract Agreement exhibited by the Plaintiff are not disputed by the Defendant, we repeat and adopt paragraphs 50 to 60 of the Plaintiff’s Submission in response thereto the Defendant’s preliminary objection above, that the Subcontract which incorporates the Conditions of Subcontract by reference constitutes the arbitration agreement between parties pursuant to Section 9(5) of AA 2005. [Emphasis added] The contentions of the defendant [13] The defendant contends in Enclosure 48 reply written submission that:

… the arbitration agreement for the present matter is contained in the Conditions of Subcontract, and not in the Subcontract Agreement and the Supplementary Subcontract Agreement (where the Plaintiff adduced the certified copy of the same).

The Plaintiff has not adduced the original or the duly certified copy of the Conditions of Subcontract which contains the arbitration agreement.

Thus, the fact remains that both the original copy and the duly certified copy of the arbitration agreement i.e the Conditions of Subcontract are not before this Honourable Court, and therefore, the Plaintiff’s OS should be dismissed by this Honourable Court given the Plaintiff’s failure to comply with Section 38(2)(b) of AA 2005. S/N uionq3xDjUKweOaghWdBBg

…

…

In the circumstances, the Defendant submits that the Plaintiff does not meet the threshold under Section 38(2)(b). [Emphasis added] Analysis of the court [14] Section 38(2)(b) of AA 2005 states that an applicant filing an application for recognition and enforcement of an arbitration award “shall produce-

(a)the duly authenticated original award or a duly certified copy of the award; and

(b)the original arbitration agreement or a duly certified copy of the agreement.” [15] There are two documents in the case before me. They are the Subcontract Agreement and the Conditions of Subcontract. [16] It is an undisputed fact that the arbitration agreement is contained in the Conditions of Subcontract. The plaintiff has failed to produce the original Conditions of Subcontract or a duly certified copy of the same which is a requirement of section 38(2)(b) of AA 2005 for an application for registration of an arbitration award. S/N uionq3xDjUKweOaghWdBBg [17] This is a mandatory duty. The law is clear that compliance with section 38(2) (b) AA 2005 is mandatory. See Tune Talk [81 - 83]. [18] The plaintiff had only produced a certified true copy of the ‘Subcontract Agreement’ which does not contain the arbitration agreement but merely refers to thirteen other documents one of which is the ‘Conditions of Subcontract’ which contains the arbitration agreement. [See Enclosure 35 plaintiff’s affidavit in reply no. 2 at paragraph 9 and exhibit “Y”]. [19] In my view, this is not compliance with section 38(2) (b) AA 2005. A certified true copy of the ‘Subcontract Agreement’ is not the same as a certified true copy of the ‘Conditions of Subcontract’ by any stretch of imagination. They are both distinct and different documents. [20] In conclusion, the plaintiff had failed to comply with section 38(2) (b) AA 2005 and this failure is fatal.

[21] I dismiss the OS with costs of RM 20,000 subject to allocatur. For the record that I disallow the OS solely for non-compliance with section 38(2)(b) of AA 2005 and have not considered the merits of other arguments raised before me. S/N uionq3xDjUKweOaghWdBBg [22] Lastly, I thank counsel for their helpful submissions. ………(signed)…………. Leong Wai Hong Judge High Court of Malaya Kuala Lumpur (NCC 6) Dated: 25th April 2025. COUNSEL: 1) Peter Justin Skelchy, Tan Zhixin and Liew Lok Yee for plaintiff. (Cheah Teh & Su (Kuala Lumpur)) 2) Christopher Arun, Slyvie Tan and Muhammad Aiman bin Mohd Firhad for defendant. (Ariff Rozhan & Co. (Kuala Lumpur)) CASES REFERRED TO: 1) Low Cheng Soon v TA Securities Sdn Bhd [2003] 1 MLJ 389. 2) Tune Talk Sdn Bhd v Padda Gurtaj Singh [2020] 3 MLJ 184 CA. 3) Yap Hong Lang @ Yap Fong Mei & Ors [2006] 6 MLJ 607. S/N uionq3xDjUKweOaghWdBBg LEGISLATION REFERRED TO: 1) Arbitration Act 2005, sections 38(2)(b) and 39. S/N uionq3xDjUKweOaghWdBBg