Court emphasized the binding nature of adjudication decisions under CIPAA, requiring prompt enforcement unless compelling reasons for a stay are presented.

[1] By contract dated 7 May 2008 the Plaintiff, as "Employer" employed the Defendant as "Contractor" to carry out the renovation and refurbishment of the exterior and interior of Terminal 3, Lapangan Terbang Sultan Abdul Aziz Shah, Subang, Selangor [the Works Contract]. The Defendants last three claims; Certificates Numbers 9, 10A and the Final Account Certificate No 11 were not paid by the Plaintiff. These three certificates had been certified by the architect and accepted by the Plaintiff on 19 January 2011.

[2] On 19 June 2014, the Defendant served a payment claim in respect of the three certificates on the Plaintiff pursuant to the Construction Industry Payment and Adjudication Act 2012 [Act 746] [CIPAA]. The sum claimed inclusive of interest was RM2,603,390.47. The Plaintiff issued a payment response dated 26 June 2014 where it disputed the Defendants claim on the ground that the Plaintiff had a valid LAD claim against the Defendant for late completion of the works as the Certificate of Completion and Compliance (CCC) was only issued on 2 November 2011. The Plaintiff claimed that it was entitled to set off a sum of RM3,201,000.00 for the late completion of the works calculated at the rate of RM3,000 per day for 1,067 days: from 1 December 2008 to 2 November 2011. A Certificate of Non-Completion dated 4 March 2010 was produced in support of this contention.

[3] A Notice of Adjudication was issued on 17 July 2014 and on 24 November 2014, an adjudicator was appointed. In its Adjudication Claim (and later in its Adjudication Reply), aside from justifying its right to the sum claimed, the Defendant relied on cl 23.1 of the underlying contract to support its contention that the Plaintiff had no right of set off available for the LAD claim.

[4] On 25 February 2015, the adjudication decision was delivered. On 26 February 2015, a Correction of the adjudication decision was published. In that Corrected adjudication decision, the Defendants claim was allowed whereas the Defendants cross claim for the LAD was dismissed. In the course of his decision, the learned adjudicator agreed with the Defendant that "...while the Employer may be entitled to liquidated damages against the Contractor for non-completion of the works within the time set for completion, Cl 23.1 prohibits such set off in Adjudication proceedings". He found that the Plaintiffs liquidated damage claim "ought to be treated as a separate and distinct contract.... The right of the Employer to liquidated damages is not lost. It is only not subject to set off in Adjudication and must therefore be pursued separately". He agreed with the Defendant and felt "constrained to decline the Respondents contention that it has jurisdiction to determine liquidated damages as a cross-claim".

[5] It is a matter of record that there were concurrent arbitration proceedings. The arbitration proceedings were initiated by the Defendant on 7 August 2014 with the Plaintiff issuing a Cross Notice of Arbitration on 27 August 2014.

[6] In its Points of Claim, the Defendant not only claimed for the same sum that was claimed in the adjudication claim, it was claimed on the same basis. The Defendant went on to challenge inter alia the Plaintiffs Notice of Non-Completion, that it was the Plaintiff who was in delay; and that it was the Plaintiff who was in breach of the Works Contract.

[7] In Defence and Counterclaim, the Plaintiff not only claimed for the LAD, it also alluded to deliberations between the parties which led to the parties agreeing "to forego their respective claims/potential claims against each other and to put this entire matter behind them". The Plainti