Tewara Sdn Bhd v Lee Choon Seng & Sons Sdn Bhd (JA-12BNCvC-7-04/2022)

the sum of RM92,424.00 being liquidated and ascertained damages for the delay in completing the works;

the sum of RM274,028.00 being the additional costs incurred by the Defendant to rectify defects and finish the works omitted by the Plaintiff;

interest at the rate of 5% per annum on RM92,424.00 calculated from the date of filing the counter claim i.e.

8.10.2019 until the date of full settlement;

interest at the rate of 5% per annum on RM274,028.00 calculated from the date of filing the counter claim i.e.

8.10.2019 until the date of full settlement;

cost of RM10,000.00 to be paid by the Plaintiff to the Defendant. [3] After having read the grounds of judgement of the SCJ, the Appeal Records and Parties’ written submissions, and having heard the oral submissions of the Parties, the Court allows part of the appeal of the Plaintiff that the Defendant is to return the retention sum of RM136,926.15 (reduction sum) with costs of RM5,000.00, subject to cost of allocator, to be paid by the Defendant to the Plaintiff. However, the Court dismissed the appeal against the counter claim of the Defendant with costs of RM5,000.00, subject to cost of allocator, to be paid by the Plaintiff to the Defendant. [4] Dissatisfied with the said decision, the Plaintiff has in turn appealed further to the Court of Appeal. The Defendant also filed a cross appeal to the Court of Appeal against this court’s decision in allowing part claim of the Plaintiff. Background Facts [5] The Defendant was the main contractor appointed by Johor Land Berhad (“Employer”) for the following projects:

construction of 81 units of terrace houses type Roselle 1 at neighborhood 12, Bandar Dato' Onn, Johor Bahru, Johor ("Roselle 1 Project (BDO 81)");

construction of 86 units of terrace houses type Roselle 2 at neighborhood 12, Bandar Dato' Onn, Johor Bahru, Johor ("Roselle 2 Project (BDO 86)");

construction of 144 units of terrace house type Lovage at Taman Bukit Dahlia, Pasir Gudang,

construction of 4 units show house which include 2 units type Amber 1 and 2 units type Amber 2 at Bandar Tiram 1, Johor Bahru, Johor (“Amber Project”); (Roselle 1 Project (BDO 81), Roselle 2 Project (BDO 86), Lovage Project (PG 144), and Amber Project are collectively referred to as the “Project”). [6] The Defendant agreed to appoint the Plaintiff as subcontractor to supply, delivery, lay and install complete with (c/w) testing and commissioning for electrical works system, telephone and street lighting infrastructure system for the following Projects(the “Works”):

Roselle 1 Project (BDO 81) on 26.4.2013;

Roselle 2 Project (BDO 86) on 26.4.2013;

Lovage Project (PG 144) on 20.7.2013; and

Amber Project on 11.5.2013, (collectively referred to as the “LOAs”). [7] The Plaintiff claimed that the Works as agreed in the LOAs had been completed within the specified time period where the Plaintiff had also issued letters to claim for progressive payment but the Defendant failed to make the necessary payment and to release the retention sum to the Plaintiff according to clause 5 of the LOAs. Hence, the Plaintiff claims the following outstanding sum for works done and the retention sum held by the Defendant, as follows: Project Amount paid Retention Sum Balance Show Houses RM24,462.50 RM1,287.50 - Roselle 2 RM760,000.00 RM45,901.25 RM112,123.75 Roselle 1 RM670,000.00 RM42,83 l .90 RM143,806.10 Lovage RM913,000.00 RM49,759.25 RM32,425.75 Total RM2,367,462.50 RM139,779.90 RM288,355.60 [8] In brief, the Plaintiff’s claims are as follows:

arrears for electrical wiring works amounting to RM288,355.60;

retention sum of RM139,779.90;

interest of 5% per year on the arrears and retention sum starting from the date of this writ of summons is filed until full settlement;

cost of Solicitors and Attorneys;

cost; and

other orders that the Court deems necessary and/or expedient for this action. [9] The Defendant filed its defence and counter claim on 8.10.2019 where the Defendant's defence are as follows:

there were defects for the Works done and/or completed by the Plaintiff which the Defendant had appointed a third-party contractor to carry out the necessary repair works where the repair cost amounted to RM274,028.00;

there was delay by the Plaintiff to hand over the Works done where the losses for late completion of Works amounted to RM92,424.00; and

the Defendant need not pay the Plaintiff as there were defects and instead, the Plaintiff should pay to the Defendant the repair costs and losses for late completion of Works suffered by the Defendant. The Law [10] It is trite law that an appellate court is required to determine whether or not the trial court had arrived at its decision or finding correctly based on the relevant law and established evidence. It is also trite that an appellate court will not generally intervene with the decision of a trial court unless the trial court is shown to be plainly wrong in arriving at its decision. A plainly wrong decision happens when the decision of the trial court is arrived at without judicial appreciation of the evidence (see UEM Group Bhd. (previously known as United Engineers (M) Bhd. vs. Genisys Integrated Engineers Pte Ltd & Anor [2018] supp MLJ 363; [2010] 9 CLJ 785, Chow Yee Wah & Anor vs. Choo Ah Pat [1978] 2 MLJ 41; [1978] 1 LNS 32, Watt or Thomas vs. Thomas [1947] AC 484 and Gan Yook Chin [2004] 4 CLJ 309). [11] Further, the Malaysian Civil Procedure (White Book) 2018 edition states that— “An appeal that is re-heard means the High Court judge would consider the case afresh without reference to the reasons and written grounds of the lower court judge. In a re-hearing, a judge is not tasked to consider whether the lower court judge had exercised his discretion correctly or had properly considered the relevant material. He would consider the case as if it came before him for the first time.” [Emphasis added] [12] Hence, as a general rule a finding of facts by a SCJ is rarely disturbed by the appellate court unless the SCJ is shown to be plainly wrong in arriving at its decision.

whether the SCJ has erred in law and fact in deciding the Plaintiff failed to call the material and relevant witnesses to prove their claims [13] The Plaintiff submitted that they have called the relevant and important witnesses in relation to the case in order to prove its claim where PW1 is the Director of the Plaintiff and he has full knowledge of the claim. He was empowered and appointed by the Plaintiff to represent and to be witness of this case which is shown in his Witness Statement (see page 55 of Record of Appeal). [14] However, the SCJ has failed to consider that PW1 is a general manager of the Plaintiff where he is in charge for all the Works of the Plaintiff. Trevor Sim is only in charge for the Project Roselle 1 and 2 while Sim Siang Lye is only in charge for the Project Lovage. This was highlighted and explained to the SCJ during the re-examination (see pages no. 136-137 of Record of Appeal). Therefore, the SCJ has erred in fact and in law by invoking section 114(g) Evidence Act 1950 [Act 56] and drew adverse inferences against the Plaintiff for its failure to call a material witness. It would be unjust and unfair to the Plaintiff as the witness for the Plaintiff in this action was in fact the general manager who is in charged for all the projects and Works. [15] The Defendant on the other hand submitted that SCJ was right in law and/or fact in drawing adverse inference under section 114 (g) of Act 50 when the Plaintiff failed to call material witnesses at trial. PW1 testified that he is the Director of the Plaintiff and he has knowledge of the Project but none of the documents show PW1's involvement in the Projects. The documents tendered by the Plaintiff, particularly the documents marked as exhibits P5, P6, P7, P8, P9, P10, P11 and P12 showed that Sim Sian Lye and Trevor Sim were the representatives of the Plaintiff who handled the Projects and not PW1. When PW1 was cross-examined and/or re-examined on the matter of the Projects, PW1 several times answered “Tidak Pasti” (not sure) or “Tak Pasti” (not sure) or “Mungkin” (maybe). This indicates that PW1 did not have full knowledge to the Projects. When PW1 was asked he was not sure about the matters of the Projects, PW1 answered that his younger brother named Trevor Sim and another person named Sim Sian Lye were the project managers who handled the Projects for the Plaintiff and both of them were not called as witnesses at trial. [16] Hence, the Defendant submitted that since the Projects were managed by the Plaintiff's representatives named Trevor Sim and Sim Sian Lye and the documents tendered by the Plaintiff was also signed by Trevor Sim or Sim Sian Lye, then Trevor Sim and Sim Sian Lye ought to be called as witnesses to give testimony regarding the Projects at trial. Failure to call these material witnesses has caused the Defendant to be denied the opportunity to cross-examine them on matters about the Project. The SCJ was right in law and/or fact in invoking adverse inference under section 114 (g) of the Act 50 against the Plaintiff. The Defendant cited the case of Subry Hamid vs. Husaini Tan Sri Ikhwan & Anor [2006] 4 CLJ 50 and the case of Hassan bin Hussin vs Tengku Azhar Adib bin T Yusuf [2016] MLJU to support their contentions. Court analysis and findings [17] The court has examined the evidence adduced by the Parties, in particular PW1 and the exhibits tendered in court, and found that the documents marked as exhibit P5 and P6 were signed by Sim Sian Lye and Trevor Sim respectively. This court notes that the Plaintiff failed to call these two (2) material and relevant witnesses to prove the facts in issue. No explaination was given as to why these two witnesses were not called. However, the court is of the view that failure of the Plaintiff to call the material and relevant witness is only fatal for the Plaintiff to prove their claims and it will not affect the Defendant’s defence or counter claim. Section 114 of Act 50 provides that— “The court may presume the existence of any fact which it thinks likely to have happended, regard being had to the common course of natural events, human conduct and public and private business, in their relation to the facts of the particular case. The court may presume— … [Emphasis added] [18] Therefore, section 114(g) Act 50 will be invoked if producing these two witnesses will be unfavourable to the Plaintiff who withhold it. However, the court is of the view that non production of these witnesses is only fatal to the Plaintiff’s claim and it did not affect the Defendant’s defence or counter claim. There is no necessity to invoke section 114(g) Act 56 against the Plaintiff. Hence, the court is of the view that there is an error made by the SCJ in his findings by invoking section 114(g) Act 56 against the Plaintiff.

whether the SCJ has erred in law and fact in deciding the Plaintiff failed to prove its case on the balance of probabilities and failure of the Defendant to release the retention sum

whether the SCJ has erred in law and fact in deciding the Defendant has proven their counter claims against the Plaintiff [19] In the present case, the Plaintiff’s cause of action against the Defendant are as follows: LOAs; Defendant but, until the suit has been filed, the Defendant has still not informed the Plaintiff whether the Certificate of Completion (“CPC”) for the Projects has been issued; and Works done and completed by the Plaintiff and failed to release the retention sum to the Plaintiff. [20] The Plaintiff submitted that the SCJ has failed to consider all the facts and evidence presented in this action and also the admissions which remained unchallenged during the trial that—

the Defendant had failed and never informed the Plaintiff that CPC of Works had been issued; and

the Defendant's Director admitted that the Defendant did not pay the sum for Works done amounting to RM288,355.60 and the retention sum amounting to RM139,779.90 and this should be treated as evidence to prove the Plaintiff’s claim in this action pursuant to section 8 of Act 56. In support their arguments, the Plaintiff cited the cases of SPM Membrane Switch Sdn. Bhd v. Kerajaan Negeri Selangor [2016] 1 MLRA 1 and Oimonda Malaysia Sdn. Bhd. v. Sediabena Sn Bhd & Anor [2011] 1 MLRA 574;

based on the evidence of DW2, the CPC for the Amber Show House project had already been issued to the Defendant in 2014, which is 8 years ago, whereas CPC for Project Roselle 1 (exhibit D30) was issued to the Defendant on 27 September 2015 and CPC for Project Roselle 2 (exhibit D33) was issued to the Defendant on 27 September 2015. Furthermore, DW2 has already admitted that Johor Land Berhad (“JLB”) had also issued a CPC for both projects to the Defendant in 2015 during the reinforcement inspection;

it is not a requirement to issue a letter to the Defendant to demand release of the retention sum and this was also admitted by DW2 during cross-examination. DW2 also admitted that the Defendant did not make payment to the Plaintiff for Roselle 2 even though Works had been completed and the Defendant even tried to place the burden on the Plaintiff alleging the Plaintiff should have written a letter to confirm that Works had been completed; and

the admission of DW2 in cross-examination for never claiming the repair costs for the defects and the losses for the late completion which will render the Defendant's counter claim to be an afterthought. [21] Therefore, failure of the Defendant to pay the Plaintiff for the Works done, the Plaintiff is entitled to terminate the agreement under section 40 Contract Act 1950 [Act 136] and claim for damages for Works done under section 74 Act 136. The Plaintiff cited Hadley vs. Baxendale (1854) 156 ER 145 and the case of Switch Flow Resources Sdn. Bhd. vs. North Emerald (M) Sdn. Bhd. [2021] MLRHU 1999 to support their contentions. Further, the Defendant has breached the terms and conditions stated in the LOAs and the promises given to the Plaintiff and the Plaintiff shall be allowed to claim for the damages suffered by the Plaintiff. [22] The Plaintiff further submitted that admission by DW2 himself clearly showed the Defendant's dishonest state of mind in withholding the retention sum and not disclosing to the Plaintiff of the issuance of CPC resulting and/or causing the Plaintiff to be unable to claim the sum for Works done and the retention sum. Hence, the Plaintiff submitted that without the knowledge of the issuance of the CPC for the Works, the Plaintiff was unable to claim the 5% retention sum that had been withheld by the Defendant and to know when the Defect Liability Period will start in order to ascertain whether the Plaintiff should be responsible and/or liable for the repair works. [23] Therefore, the Plaintiff submitted that the Defendant should return and/or refund the retention sum withheld by the Defendant to the Plaintiff after the Work done according to the LOAs (see pages 272, 276, 287, 299 of the Record of Appeal) entered into by the Plaintiff and the Defendant, specifically clause 5 of the LOAs which states the following: “5 Terms of Payment All payment shall be subjected to the retention of 5% of the amount certified from each claim until reach a maximum of 5% of contract sum......The retention sum of 5% shall be released thirty (30) months upon issuance of Certificate of Practical Completion and can be extend to another three (3) months.”. [Emphasis added] [24] The Plaintiff submitted that the Defendant has the right to terminate the agreement under clause 8 of the LOAs if the Defendant is not satisfied with the Plaintiff’s Work and/or there is a delay in completing the Plaintiff’s Works. However, with DW2's admission during cross-examination it is clear and obvious that the Defendant never terminated the agreement nor did it claim for any damages for the alleged defects and/or the alleged late completion of Works from the Plaintiff until this action was filed. [25] Hence, it is clear that this is the Defendant's afterthought in order to try to escape from their liabilities to pay the Plaintiff and the Defendant even has the intention to contra the repair costs and losses for late completion of the Works (if any) with the amount due and owing to the Plaintiff. This can be seen in the Statement of Defence dated 8.10.2019 (see page 26 of the Record of Appeal). [26] The Plaintiff further submitted that the SCJ erred in making finding of facts and law that there were defects in the Works done by the Plaintiff simply based on claims that incidents had happened. DW1 admitted during cross-examination that he only visually checked to ascertain whether there was structural modification of the premises and electricity for which no special report had been made. DW1 also stated that he cannot correctly identify who has caused the fire to occur in the Premises and resulted damages. Further, DW1 informed that no investigation of the use of electrical goods was done to find out who was responsible. Therefore, it would be unjust and unfair for the Plaintiff to be held responsible since there is no evidence to show that incidents happened due to defect in the Works done by the Plaintiff. [27] Furthermore, the Defendant also failed to adduce evidence to prove DW3 and DW4 have been appointed as third-party contractors and they had already completed the Works. As such and based on the written submissions and authorities, the Plaintiff prayed that the Plaintiff's appeal be allowed accordingly with costs. [28] The Defendant on the other hand contended otherwise. The Defendant submitted that the SCJ was right in law and/or fact in dismissing the Plaintiff’s claim with costs when the Plaintiff failed to prove its claim against the Defendant. It is trite law that the burden of proof rests throughout the trial on the party who asserts that the facts exist. Thus, the Plaintiff has the burden of proving both liability and quantum of damages. The Defendant referred to the case of Tenaga Nasional Berhad (Formerly Lembaga Letrik Negara Tanah Melayu) vs. Perwaja Steel Sdn Bhd (Formerly Perwaja Terengganu Sdn Bhd) [1995] 4 CLJ 670 to support their arguments. [29] The Defendant submitted that the Plaintiff failed to prove its claim for the sum of RM288,355.60 being the arrears for the electrical wiring works allegedly carried out by the Plaintiff and the sum of RM139,779.90 being the alleged retention sum based on the following reasons: “provisional” and the final quantity should be determined to the actual work done on site or refer to as-built drawings. Clause 2 provides that— “The total subcontract works sum are provisional…Final quantity shall be determined to actual work done on site or to refer as-built drawings.”; Defendant for each claim up to a maximum of 5% of the contract value. This means that the Plaintiff's claim is subject to the Defendant's certification. This was agreed by PW1 and DW2 during cross-examination; Plaintiff, the Plaintiff must meet 2 conditions, namely— i. final remeasurement must be done by the Plaintiff and the Defendant; and ii. the Plaintiff's claim must be certified by the

however, no final remeasurement was done and/or requested by the Plaintiff as stipulated in clause 2 of the LOAs and no evidence was submitted by the Plaintiff that the Defendant ever rejected the Plaintiff 's request for final remeasurement;

the Defendant has never received the details of the Plaintiff's claim for Amber Project, Roselle 1 Project (BDO 81), and

the Plaintiff's claim in the present case was never certified by the Defendant and it was admitted by PW1 during cross-examination. Hence, the Defendant denied the Plaintiff’s claim as it was never certified by the Defendant;

the Plaintiff took into account the Works omitted by the Plaintiff in their claims which was incorrect;

since the Plaintiff's claim is closely related to the total value of the Works done, the failure of the Plaintiff to prove the total value of the Works done indicates that the Plaintiff failed to prove his claim;

the Plaintiff pleaded in the Statement of Claim that the retention sum is RM139,779.90, however, by referring to the exhibits P1, P10, P11, and P12, the oustanding retention sum is calculated to be RM136,926.15; and

there is clear discrepancy between the amount of retention sum claimed by the Plaintiff in the Statement of Claim and the documents adduced by the Plaintiff and it is directly shows that the Plaintiff failed to prove its claim for the retention sum. [30] The Defendant further submitted that the SCJ was right in law and/or fact in holding that the Plaintiff failed to complete the Works specified in the LOAs based on the following grounds:

PW1 in his witness statement stated that the Plaintiff has completed Amber Project on 14.7.2013, Lovage (PG 144) Project on 16.4.2015, Roselle 1 (BDO 81) Project on 6.5.2015, and Roselle 2 (BDO 86) Project on 5.8.2015. However, PW1 failed to produce any documents to prove it and has admitted that there is no document to support his statement. Thus, PW1’s statement on the completion of the Works is totally untrue and baseless;

(b)

according to the LOAs, the Plaintiff needs to obtain a Certificate of Fitness Occupation (“CFO”) for the street lighting infrastructure works for the Roselle 1 Project (BDO 81) & Roselle 2 Project (BDO 86) and also to hand over the street lighting infrastructure works to MBJB a year after the issuance of the CFO certificate. However, the Plaintiff only obtained the CFO certificate for the street lighting infrastructure works for Roselle 1 Project (BDO 81) & Roselle 2 Project (BDO 86) but failed to complete the hand over job for street lighting to Majlis Bandaraya Johor Bharu (“MBJB”) and obtain the street lighting acceptance certificate from MBJB;

the handing over of street lights to MBJB was done by DW3 and DW4 and supported by exhibit D26 i.e. the street light acceptance certificate issued by the Bahagian Pengangkutan Bandar, Jabatan Kejuruteraan Majlis Bandaraya Johor Bahru and “sokongan pengeluaran sijil penerimaan lampu jalan”. The testimonial of DW3 and DW4 were not challenged by the Plaintiff at trial and it is deemed admitted by the Plaintiff; and

DW3 and DW4 testified that they are appointed by the Defendant to carry out the work of handing over the street lights to Tenaga Nasional Berhad (“TNB”) and MBJB and they attended the installation, connection, and functionality tests of the street lights together with TNB’s representatives for the Lovage Project (PG 144). The testimonies of DW3 and DW4 are supported by TNB's letter dated 25.1.2018 which is marked as exhibit D23 and were never challenged by the Plaintiff during cross examination and therefore their evidence are deemed admitted. The Defendant has cited the case of Yeo Ing King vs. Melawangi Sdn Bhd [2016] 5 MLJ 631 to support their contentions. [31] The Defendant submitted pursuant to clause 7 of the LOAs, the Plaintiff shall carry out and complete the Works diligently and in a good and workmanlike manner and using reasonable skill and care including the selection of any specifications for the materials and goods and workmanship to be used in the Works. However, the Works carried out by the Plaintiff were full of defects and even caused a fire incident to occur at the Fire Affected Premises on 21.7.2018. This is supported by DW2's testimony and the purchasers/house owners’ technical feedback forms adduced by the Defendant and marked as exhibit D15. [32] DW1 confirmed that the fire incident occurred at the Fire Affected Premises on 21.7.2018 and that the cause of the fire involved a main switch in the store room at the ground floor of the Fire Affected Premises. The report on the cause of the fire dated 14.8.2019 prepared by DW1 as in exhibit D13 and also the fire investigation report prepared by DW1 under paragraph 5(1)(b) Fire Services Act 1988 as in exhibit D14. [33] Therefore, since the main switch box/distribution board at the Fire Affected Premises was installed by the Plaintiff and according to DW1’s investigation, there was no sign of renovation or electrical modification found at the Fire Affected Premises and the main switch box/distribution board at the Fire Affected Premises was still in its original condition. Thus, the Plaintiff should be held responsible for the poor connection in the main switch box which is the cause of the fire incident. After the fire incident, the Employer, Johor Land Berhad (“JLB”), has instructed the Defendant to inspect the distribution board in the houses of Phase 2, Lovage Project (PG 144) for the safety of the occupants. The Defendant then appointed DW4 to carry out inspection to the distribution board installed by the Plaintiff in 85 units of house at Phase 2, Lovage Project (PG 144). [34] Despite the Defendant demanding repeatedly for the Plaintiff to rectify the defects, including but not limited to serving letters as in exhibit D18 and exhibit D19 to the Plaintiff, no action was taken by the Plaintiff and it was admitted by PW1 during cross-examination. [35] Further, the Defendant submitted that the SCJ was right in law and/or fact in holding that the Defendant successfully proved its counter claim against the Plaintiff for the sum of RM274,028.00 being the additional costs incurred by the Defendant to rectify the defects and complete the Works omitted by the Plaintiff. The Defendant appointed DW3 and DW4 to complete the Works that were omitted by the Plaintiff and to rectify the defects; [36] Hence, the Defendant is entitled to claim against the Plaintiff for the additional costs incurred by the Defendant which include rectification costs, administrative costs at the rate of 15% and additional operating costs— surcharge would be imposed on the Plaintiff if the Plaintiff failed to replace the damaged distribution board and PW1 admitted that they received D18 during the cross-examination. The Defendant cited the case of Arowana One Enterprise Sdn. Bhd. vs.Tractors Petroleum Services [2009] MLJU 1573 to support their claims for the administrative charge which is amounting to RM24,708.00 (RM164,720.00 x 15%); 81), and Roselle 2 Project (BDO 86) to supervise the Works from March 2017 to August 2018 or 18 months or an average of 6 months for each Project. The particulars of the addition operating costs are as follows : i. supervisor salary amounting to RM72,000 (RM4,000.00 x 6 monthsx 3 projects); and ii. diesel and vehicle maintenance cost amounting to RM12,600.00 (RM700.00 x 6 months x 3 projects); and RM92,424.00. [37] Pursuant to the LOAs, the Plaintiff was required to complete the Works by the following dates. However, due to a delay in completing the Works by the Plaintiff , the number of days of delay are as follows: Project Commencement Date Contractual Completion Date Actual Completion Date Delay (Days) Roselle 1 Project (BDO 81)

22.10.2012 21.9.2013 11.6.2015 629 Roselle 2 Project (BDO 86)

22.10.2012 21.9.2013 26.5.2015 613 Lovage Project (PG144) –

20.7.2013 20.7.2014 20.9.2015 428 Lovage Project (PG 144) – Parcel 2 To be determined by the Defendant not later than 6 months from the award of Parcel

9 months from the date for possession of site as stated in the notice of commencement of Works.

14.7.2013 [38] The Defendant submitted that the Plaintiff has requested an extension of time for Roselle 1 Project (BDO 81) and Roselle 2 Project (BDO 86) from the Defendant, but the Defendant never granted any extension to the Plaintiff. However, since JLB gave the Defendant extension of time to complete the Works and for the sake of fairness to the Plaintiff, the Defendant did not refer to the days of delay as submitted above but referred to the days of delay calculated by JLB to claim LAD as follows: Project Extension of time given by the Employer Actual Compeletion Date Delay (day) Roselle 1 (BDO 81) Project 19.3.2015 11.6.2015 84 Roselle 2 (BDO 86) Project 19.3.2015 26.5.2015 68 Lovage (PG144) Project – Parcel 1 29.8.2015 20.9.2015 23 Lovage (PG 144) Project – Parcel 2 30.10.2015 3.12.2015 35 [39] Therefore, the total LAD ought to be paid by the Plaintiff to the Defendant is RM92,424.00 as specified below: Project Delay (day) LAD per day (RM) Total LAD (RM) Roselle 1 Project (BDO 81) 84 487.00 40,908.00 Roselle 2 Project (BDO 86) 68 535.00 36,380.00 Lovage Project (PG144) – Parcel 1 23 442.00 10,166.00 Lovage Project (PG 144) – Parcel 2 35 142.00 4,970.00 Total 92,424.00 [40] Hence, the Defendant submitted that SCJ was right in law and/or fact in dismissing the Plaintiff’s claim against the Defendant with cost of RM10,000.00 and allowing the Defendant’s counter claim against the Plaintiff with cost of RM10,000.00. The Respondent therefore prays that the Plaintiff’s appeal dismissed with cost. Court analysis and findings [41] By the following LOAs, the Defendant as the main contractor for the Project has appointed the Plaintiff to be a subcontractor to carry out the supply, delivery, lay and install complete with (c/w) testing and commissioning for electrical works system, telephone and street lighting infrastructure system for the Project (the “Works”): i. LOA dated 26 April 2013 (see page 275 of Appeal Records) for construction of 81 units of Terrace House Type Roselle 1 at Neighbourhood 12 Bandar Dato’ Onn, Johor Bahru, Johor; ii. LOA dated 26 April 2013 (see page 286 of Appeal Records) for construction of 86 units of Terrace House Type Roselle 2 at Neighbourhood 12 Bandar Dato’ Onn, Johor Bahru, Johor; iii. LOA dated 11 May 2013 (see page 272 of Appeal Records) for the construction of 4 units of show houses comprising of 2 units type Amber 1 and 2 Units Type Amber 2 At Bandar Tiram 1, Johor Bahru; and iv. LOA dated 20 July 2013 (see page 298 of Appeal Records) for the construction of 144 units of Terrace House Type Loverage at Taman Bukit Dahlia, Pasir Gudang, Johor. [42] In the present case, the court finds that the Plaintiff failed to call the relevant and material witnesses, namely Sim Sian Lye and Trevor Sim who was in charge of the Works and signed the documents marked as exhibits P5, P6, P7, P8, P9, P10, P11 and P12 to prove their claims againt the Defendant. PW1 informed that his younger brother named Trevor Sim and another person named Sim Sian Lye were the project managers who handled the Works for the Plaintiff and both of them were not called as witnesses at trial. [43] PW1 was not able to give affirmative answer when he was questioned on the matter of the Works. It shown that PW1 did not have full knowledge to the Works. PW1 could not produce any document to prove that the Plaintiff has completed Amber Project on 14.7.2013, Lovage (PG 144) Project on 16.4.2015, Roselle 1 (BDO 81) Project on 6.5.2015, and Roselle 2 (BDO 86) Project on 5.8.2015. [44] The Plaintiff has submitted progress claim vide the following letters to the Defendant: dated 10.4.2014 as in exhibit P10; House Type Roselle 1 dated 20.6.2016 as in exhibit P11; House Type Roselle 2 dated 20.6.2016 as in exhibit P12. [45] However, the Defendant did not pay to the Plaintiff the sum claimed by them. The Defendant argues that the amount claim is provisional and subject to be certified by the Defendant pursuant to clause 2. The Plainitff on the other hand contended failure of the Defendant to inform them the issuance of CPC has caused the Plaintiff could not submit their claims. [46] Clause 2 of the LOAs, inter alia, provide that— “The total subcontract works sum are provisional and the amount shall be…Final quantity shall be determined to actual work done on site or to refer as-built drawings….”. [Emphasis added] [47] Upon perusal of clause 2 of the LOAs, the court is of the view that there is no requirement of the issuance of CPC to enable the Plaintiff to submit their claims and therefore their arguments are completely devoid of merits. In this regards, the court agrees with the contention of the Defendant that the total contract sum for each project is subject to the certification by the Defendant based on the actual work done on site or to refer to as built drawings. The Plaintiff did not request for final measurement to be done by the Defendant pursuant to clause 2 of the LOAs. The Plaintiff has submitted the progress claim vide the letters dated 10.4.2014 and 20.6.2016 respectively. However, the amount claimed by the Plaintiff included the Works omitted by the Plaintiff which rendered their claims incorrect. Since the Plaintiff's claim for Works done is closely related to the total value of the Works to be certified by the Defendant, therefore the Plaintiff failed to prove their claims. [48] According to clause 6 of the LOAs, the Plaintiff was required to hand over all public utilities and services of the Works to the relevant authorities and obtain from these authorities the letter of acceptance pertaining to such hand over. The Plaintiff is also required to arrange for the submission of the meter installation application form to the relevant authorities. Clause 6 of the LOAs provide that— “for building works, the Plaintiff shall ensure that the submission for electrical meter shall remain valid until the end of defect liability period. Retention of RM80.00 shall be made until these meters are fixed. For the installation of these meters, the Plaintiff shall liase with the relevant authority and arrange for the submission of application form, setting account number, extension of validity of submission form, inspection, testing and finality fixing the meters. The subcontractor shall be required to hand over all the public utilities and sevices to the relevant authorities and obtain from these authorities the letter of acceptance pertaining to such handling over.”. [Emphasis added] [49] There is no dispute that the Plaintiff has obtained CFO for the street lighting infrastructure works for the Roselle 1 Project (BDO 81) & Roselle 2 Project (BDO 86). However, the Plaintiff has failed to complete the hand over job for street lighting to MBJB and obtain the street lighting acceptance certificate from MBJB. DW3 and DW4 have been appointed by the Defendant to carry out the work of handing over the street lights to TNB and MBJB and their testimonials are supported by TNB's letter dated 25.1.2018 which is marked as exhibit D23. The handing over of street lights to MBJB was done by DW3 and DW4 and supported by the street light acceptance certificate issued by the Bahagian Pengangkutan Bandar, Jabatan Kejuruteraan Majlis Bandaraya Johor Bahru and “sokongan pengeluaran sijil penerimaan lampu jalan” as in exhibit D26. Their evidence were never challenged by the Plaintiff during cross examination and therefore their evidence are deemed admitted. [50] Further, pursuant to clause 7 of the LOAs, the Plaintiff shall carry out and complete the Works diligently and in a good and workmanlike manner and using reasonable skill and care including the selection of any specifications for the materials and goods and workmanship to be used in the Works. However, the Works carried out by the Plaintiff were full of defects and even caused a fire incident occurred at the Fire Affected Premises on 21.7.2018. [51] According DW1, the cause of the fire involved a main switch in the store room at the ground floor of the Fire Affected Premises and there was no sign of renovation or electrical modification found at the Fire Affected Premises and the main switch box/distribution board at the Fire Affected Premises was still in its original condition. DW1 has prepared the report on the cause of the fire dated 14.8.2019 as in exhibit D13 and fire investigation report under paragraph 5(1)(b), Fire Services Act 1988 as in exhibit D14. Therefore, the court is of the view that the Plaintiff is responsible for the poor connection in the main switch box which is the cause of the fire incident as the main switch box/distribution board at the Fire Affected Premises was installed by the Plaintiff and the main switch box/distribution board at the Fire Affected Premises was still in its original condition. [52] The Plaintiff has failed to rectify the defects despite numerous demands by the Defendant, including the issuance of the letters as in exhibit D18 and exhibit D19 to the Plaintiff, however no action was taken by the Plaintiff. The Defendant has appointed DW3 and DW4 to complete the Works that were omitted by the Plaintiff and to rectify the defects. Therefore, the Defendant has to incur additional costs which include rectification costs, administrative costs at the rate of 15% and additional operating costs. The Defendant has imposed LAD against the Plaintiff for delay in completing the Works according to the completion date. The claim of LAD by the Defendant is based on the LAD imposed by JLB and not based on the clause 4 of each LOAs. The sum of LAD is summarised as in paragraphs 37 to 38 above. [53] Hence, the court is of the view that since the Plaintiff bears the burden of prove under section 103 Act 50 to prove their claims, and on the balance of probabilities, they have failed to do it. The Defendant has, on the balance of probabilities, proven their counter claims through the evidence and exhibits addced in court. Therefore, the court ruled that the findings of SCJ to dismiss the claim of the Plaintiff and allow the Defendant’s counter claim, with costs is upheld. [54] However, the court rules that the retention sum of RM136,926.15 (reduction sum) based on the documents produced by the Plaintiff, exhibits P1, P10, P11, and P12, to be returned by the Defendant and not the sum claimed by the Plaintiff. Clause 5 of the LOAs provide that— “All payments are subject to retention at the rate of 5% of the amount certified for each claim up to a maximum of 5% of the contract value… The retention sum of 5% shall be released within thirty (30) months upon issuance of the Certificate of Practical Completion and can be extended to another three (3) months.”. [Emphasis added] [55] In the present case, according to DW2, the CPC for the Amber Show House project had already been issued to the Defendant in 2014

22.1.1 and 22.1.2 above, until the total amount so retained is equal to the limit of the retention as stated in Appendix l.”. [Emphasis added] [57] Therefore, based on the case of Oimonda Malaysia Sdn. Bhd. (supra) and clause 5 of the LOAs, the Defendant should upon issuance of CPC, return the retention sum that deducted from the certified progress payment to the Plaintiff. No where in clause 5 of LOAs stated that the refund of retention sum is subject to the certification of the contract value by the Defendant. Thus, the contentions of the Defendant are devoid of merits. Conclusions [58] Based on the abovementioned reasons, the court allows part of the appeal of the Plaintiff, the Defendant to return the retention sum of RM136,926.15 (reduction sum) with costs of RM5,000.00, subject to cost of allocator, to be paid by the Defendant to the Plaintiff. However, the Court dismissed the appeal of the Plaintiff against the counter claim of the Defendant with costs of RM5,000.00, subject to cost of allocator, to be paid by the Plaintiff to the Defendant. Dated 17 August 2023 Signed, ………………………….. Wong Mee Ling Judicial Commissioner High Court in Malaya Johor Bahru Johor Darul Ta’zim. Counsel/Solicitor: For the Plaintiff: Miss Jane Yeo Jane Hui Messrs Chiong & Partners 33 & 33A, Jalan Dedap 19, Taman Johor Jaya, 81100 Johor Bahru For the Defendant : Mr. Chew Wei Han Messrs K H Loo & Co. 16-01, Jalan Bestari 2/2, Taman Nusa Bestari, 81300 Skudai, Johor Cases referred to:

UEM Group Bhd. (previously known as United Engineers (M) Bhd. vs. Genisys Integrated Engineers Pte Ltd & Anor [2018] supp MLJ 363; [2010] 9 CLJ 785

Chow Yee Wah & Anor vs. Choo Ah Pat [1978] 2 MLJ 41; [1978] 1 LNS 32;

Watt or Thomas vs. Thomas [1947] AC 484

Gan Yook Chin (P) & Anor vs. Lee Ing Chin @ Lee Teck Seng &

Ors [2005] 2 MLJ 1; [2004] 4 CLJ 309 Subry Hamid vs. Husaini Tan Sri Ikhwan & Anor [2006] 4

CLJ 50 Hassan bin Hussin vs. Tengku Azhar Adib bin T Yusuf [2016] MLJU

SPM Membrane Switch Sdn. Bhd vs. Kerajaan Negeri

Selangor [2016] 1 MLRA 1 Oimonda Malaysia Sdn. Bhd. vs. Sediabena Sn Bhd & Anor [2011] 1 MLRA 574

Hadley vs. Baxendale (1854) 156 ER 145

Switch Flow Resources Sdn. Bhd. vs. North Emerald (M)

Sdn. Bhd. [2021] MLRHU 1999 Tenaga Nasional Berhad (Formerly Lembaga Letrik Negara Tanah Melayu) vs. Perwaja Steel Sdn Bhd (Formerly Perwaja Terengganu Sdn Bhd) [1995] 4 CLJ 67

Yeo Ing King vs. Melawangi Sdn Bhd [2016] 5 MLJ 631

Arowana One Enterprise Sdn. Bhd. vs.Tractors Petroleum

Services [2009] MLJU 1573 Malaysian Civil Procedure (White Book) 2018 Legislation referred to:

Evidence Act 1950 [Act 56]

Contract Act 1950 [Act 136]