Non-compliance with mandatory provisions of CIPAA could obligate a Defendant to pay adjudicated sums directly, regardless of claims of non-existent debts due.

Lim Chong Fong J:

Introduction

[1] These are applications to seek for direct payment from principal under s 30 of the Construction Industry Payment and Adjudication Act 2012 ("CIPAA").

[2] The Plaintiff in both originating summons is a private limited company involved in piling business.

[3] The Defendant in both originating summons is also a private limited company involved in the piling business as well.

Background Facts

[4] By a letter of award dated 10 April 2017 ("Contract"), the Plaintiff was appointed by Civil Tech Sdn Bhd ("CTSB") to carry out and complete works described as the supply of skilled labour, machinery and equipment for certain bored pile works for the project known as "The Construction and Completion of Proposed Sungai Besi - Ulu Kelang Elevated Expressway ("SUKE Project").

[5] The main contractor of the SUKE Project is ML Sepakat & CHEC Joint Venture who in turn sub-contracted the bored piles works under the SUKE Project to CHEC Construction (M) Sdn Bhd. Consequently, CHEC Construction (M) Sdn Bhd ("CCMSB") sub-sub contracted part of the aforementioned bored piles works to the Defendant who in turn sub-sub-sub contracted the SUKE-CA4 package on bored piling works to CTSB by virtue of a letter of award dated 8 December 2016 ("Principal Contract").

[6] In addition by a rental agreement dated 21 August 2017 ("Rental Agreement"), the Plaintiff rented a unit of Bauer Boring Rig RB28 c/w Kelly Bar ("Equipment") to CTSB for purposes of carrying out the bored piling works under the same aforementioned SUKE-CA4 package.

[7] The Plaintiff duly carried out its work under the Contract as well rented the Equipment to CTSB pursuant to the Rental Agreement until CCMSB and the Defendant mutually terminated their sub-sub contract on 19 December 2017. As a result, the Contract and Rental Agreement were also terminated accordingly. That notwithstanding, CTSB failed to fully pay the Plaintiff under the Contract and failed to pay the Plaintiff any money under the Rental Agreement.

[8] As a result, the Plaintiff initiated adjudication proceedings under the CIPAA against CTSB pursuant to the Contract and the Rental Agreement separately.

[9] The Plaintiff succeeded in both adjudication proceedings.

[10] In respect of the adjudication pursuant to the Contract, the adjudicator ordered as follows in his adjudication decision dated 30 August 2018:

(A) The Respondent shall pay to the Claimant the outstanding unpaid certified sum of RM1,598,086.52 (comprising of RM29,688.43 balance to be paid for the 4 tax invoices and RM1,568.398.09 (excl. GST) for Progress Claim no. 9 (rev)) within 30 calendar days after receiving this Adjudication Decision;

(B) The Respondent shall bear the costs of these proceedings amounting to RM43,538.10, the Respondent is to pay the Claimant the sum of RM43,538.10 within 30 calendar days after receiving this Adjudication Decision;

(C) The Claimant is entitled to 5% per annum "post award" interest from the date of this Adjudication Decision until the date of full settlement; and

(D) The payments under A, B and C above are to be made by cheque, banker's cheque, cash or online transfer of funds into the Claimant's bank account.

[11] As to the adjudication pursuant to the Rental Agreement, the adjudicator ordered as follows in his decision dated 20 August 2018:

(a) The payment of RM205,476.96 of the said Tax Invoices sought in the payment Claim by the Claimant are ALLOW accordingly;

(b) The interest at the rate of 1.0% per month on the sum of RM48,923.08 shall calculate from 11 October 2017 until full settlement are ALLOW accordingly;

(c) The interest at the rate of 1.0% per month on the sum of RM127,200.00 shall calculate from 2 November 2017 until full settlement are ALLOW accordingly;

(d) The interest at the rate of 1.0% per month on the sum of RM29,353.88 shall calculate from 6 December 2017 until full settlement are ALLOW accordingly;

(e) The Respondent shall pay the Adjudicated Sum of RM205,476.96 plus interest at the r