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2025 MarsdenLR 2012

HIGH COURT MALAYA KUALA LUMPUR
SUE LYE CONSTRUCTION SDN BHD – Appellant
Versus
BRILLIANT LTP CONSTRUCTION SDN BHD & ANOTHER CASE – Respondent
[Originating Summons No: WA-24C-163-10/2024 & WA-24C-166-10/2024]



Important Points

The adjudicator's decision was upheld as there was no denial of natural justice, and jurisdictional objections not raised during proceedings cannot be asserted later.

Subject

Construction Law - Adjudication

Headnote

(A) Construction Industry Payment and Adjudication Act 2012 - Sections 15(b), 15(d), 28, and 36 - Enforcement of adjudication decision - Application to set aside adjudication decision on grounds of denial of natural justice and excess of jurisdiction - Court finds no denial of natural justice as both parties were given opportunity to present their case - Adjudicator did not exceed jurisdiction as the applicable provision was clearly established. (Paras 25, 61, 73)

(B) Jurisdiction - Adjudicator's jurisdiction limited to matters raised in payment claim and response - Respondent's failure to raise jurisdictional objections during adjudication precludes later challenges - Court emphasizes the importance of raising issues timely. (Paras 42, 46)

Facts of the case:
The case involves a dispute between the claimant and respondent regarding a payment claim under a construction contract, where the claimant sought to enforce an adjudication decision while the respondent attempted to set it aside, citing jurisdictional issues and natural justice concerns. (Paras 1-4, 6-8)

Findings of Court:
The court found that there was no breach of natural justice and that the adjudicator did not exceed his jurisdiction. The adjudication decision was allowed to stand, and the enforcement application was granted. (Paras 73-74)

Issues: The main issues were whether there was a denial of natural justice in the adjudication process and whether the adjudicator acted in excess of his jurisdiction. (Paras 25, 61)

Ratio Decidendi: The court ruled that the adjudicator's decisions were within his jurisdiction and that both parties had adequate opportunity to present their case, thus upholding the adjudication decision as valid. (Paras 60-62)

Result: Originating Summons No WA-24C-166-10/2024 is dismissed; Originating Summons No WA-24C-163-10/2024 is allowed.

Petitioner Advocates:Low Kin Ning ,Respondent Advocate: Nicholas Ng

JUDGMENT

NAzlan Sulaiman J:

Introduction

[1] By Originating Summons No: WA-24C-163-10/2024 ("OS 163"),Sue Lye Construction Sdn Bhd ("SLC") is applying under s 28 of the Construction Industry Payment And Adjudication Act 2012 ("Act") to enforce an Adjudication Decision dated 15 September 2024 made in Adjudication Reference No: AIAC/D/ADJ-5363-2024 ("Adjudication Decision") which it obtained against Brilliant LTP Builders Sdn Bhd ("BLTP").

[2] By Originating Summons No: WA-24C-166-10/2024 ("OS 166"), BLTP is applying under ss 15(b) and (d) of the Act to set the Adjudication Decision aside.

[3] As a matter of prudence, I heard both Originating Summonses together. This Judgment is thus on both.

[4] Further as a matter of prudence, I will decide OS 166 first and then only OS 163, for the simple reason that, if the Adjudication Decision is set aside, then there will be nothing to enforce.

[5] An interesting facet of this case is that BLTP attempts to draw parallels with the decision of the Federal Court in Anas Construction Sdn Bhd v. JKP Sdn Bhd & another appeal ; [2024] 2 MLJ 543; [2024] 2 CLJ 665 ("Anas Construction") and match them with the facts of this case, contending that this Court should come to a similar finding and decision. Obviously, that will also be considered.

Salient Facts Of This Case

[6] By a Works Order dated 15 November 2022 ("Works Order"), BLTP appointed SLC to carry out site clearing, earthworks, and surveyor works (collectively "Works") on a construction project in Sembrong, Johor ("Project") on which it had been appointed as Main Contractor. Clause 2 of the Works Order is the sole provision in the Works Order pertaining to payment for the Works, and provides as follows:

"2) VALUA TION AND PA YMENT

a) Monthly progress workdone on site which certified and accepted by Main Contractor.

b) Cut-off Date of Monthly Workdone Value: 25th of the Month

c) Date of Progress Claim Submission: On or before 30th of the Month (Not entitle for any late Submission)

d) Period of honouring Payment Certificate = 30 days"

[7] On or around 7 May 2024, SLC issued to BLTP a Payment Claim dated 7 May 2024 ("Payment Claim") under s 5 of the Act in which the "Claimed Amount" was RM534,004.05 ("Claimed Amount"), being for Progress Claim No 7 dated 31 December 2023 ("Progress Claim No 7") which BLTP had yet to certify. The Payment Claim stated that the due date for payment was 30 January 2024. Linder the column entitled "Relevant contract provision / Default Provision of the Cl PA Act 2012", SLC stated:

"Payment due date is within 30 days pursuant s 36(4) of the CIPA Act 2012"

[8] Attached to the Payment Claim were 13 Schedules of documents, consisting of various documents supporting the Claimed Amount in the Payment Claim, including the Works Order, the Interim Payment Certificates for the first six Progress Claims, Progress Claim No 7, instructions issued by BLTP to SLC and some correspondences exchanged between them.

[9] When BLTP did not respond to the Payment Claim, then by s 6(4) of the Act, it was "deemed to dispute the entire Payment Claim." Moving forward, by a Notice of Adjudication dated 23 May 2024 ("Notice of Adjudication"), SLC initiated adjudication proceedings under s 8 of the Act, following which an Adjudicator was appointed. In para 39 of the Notice of Adjudication, SLC set out the brief particulars of the Payment Claim and what the dispute involved, and in sub-paragraph (c) stated:

"Clause 2(c) of the Work Order provides that the date of the Progress Claim submission shall be done by the Claimant on or before 30th of the month and the period of honouring Payment Certificate shall be 30 days. However, the clause did not provide a specific time frame for the issuance of Payment Certificate by the Respondent. Therefore, s 36 of CIPAA 2012 applies whereby payment shall be made within 30 days from the date of receipt of the Claimant's invoice of progressive claim. "

[10] By an Adjudication Claim dated 7 July 2024 ("Adjudication Claim") issued

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