The court determined that a binding adjudication decision under the CIPAA constitutes an undisputed debt, negating grounds for a Fortuna injunction against a winding-up petition.

JUDGMENT

Alice Loke Yee Ching JC:

Introduction

[1] By an Originating Summons dated 25 February 2021, the Plaintiff seeks the following prayers:

(i) a declaration that the statutory notice dated 8 February 2021 issued under s 465(1)(e) and 466(1)(a) and (2) of the Companies Act 2016 and any intended petition for winding up pursuant to the said notice is an abuse of the process of court;

(ii) an order to restrain the Defendant and an injunction be issued from presenting, advertising, gazetting a petition for winding up until the disposal of the proceedings between the parties, namely civil suit filed on 24 February 2021, the arbitration proceedings, and the Plaintiff's appeal in the court of Appeal filed on 14 October 2020; and

(iii) costs.

Background Facts

[2] The prayers sought by the Plaintiff arises from the following factual background.

[3] On 22 January 2013, the Government of Malaysia issued a Letter of Acceptance in respect of a tender submitted by a consortium known as the Skypark Link Sdn Bhd-Lion Pacific Sdn Bhd Consortium ("Consortium") for the design, construction, equipping and maintenance of a project known as Project Landasan Keretapi dari Subang ke Terminal Skypark Subang Fasa 1.

[4] By a Letter of Award dated 7 October 2013, the Consortium appointed the Plaintiff as the sub-contractor for the System Works Package for the Project ("Works").

[5] Pursuant to an agreement dated 24 November 2014, the Plaintiff appointed the Defendant to execute and complete the Works for an agreed sum of RM 42,300,000.00.

[6] Subsequently, a dispute arose between the parties in relation to the payment for the Defendant's execution of the Works. The Defendant commenced adjudication proceedings pursuant to the Construction Industry and Adjudication Act 2012 ("CIPAA 2012") by the issuance of a notice of adjudication dated 4 June 2019 for the sum of RM 24,902,980.45.

[7] The adjudication proceedings concluded on 30 October 2019 with a decision in favour of the Defendant ("CIPAA decision"). The Plaintiff was adjudged liable for the sum of RM 12,522,732.71, interests and costs.

[8] On 18 February 2020, the Plaintiff served the Defendant a reference to arbitration for a claim of RM 25,862,000.00.

[9] On 20 February 2020, the Plaintiff applied to challenge the CIPAA decision vide Shah Alam High court Suit No BA-24-12-02/2020 pursuant to s 15 and 16 of CIPAA 2012 seeking to set aside and stay the CIPAA decision.

[10] The Defendant on the other hand, sought to enforce the CIPAA decision under s 28 of CIPAA 2012 by filing an application in the same suit on 23 July 2020.

[11] All the three applications, namely, the stay application, the setting aside and the enforcement application were heard together. On 29 September 2020, the High court Judge ruled in favour of the Defendant and dismissed the Plaintiff's applications. The application to enforce the CIPAA decision was granted ("Enforcement Order").

[12] The Plaintiff then lodged appeals against the High court's decision to the court of Appeal on 14 October 2020. The appeals were registered as Appeal No B-02(C)(A)-1558-10/2020 and B-02(C)(A)-1559- 10/2020 in respect of the setting aside/stay and Enforcement Order decisions respectively. The appeals have now been fixed for hearing in the court of Appeal on 27 October 2021.

[13] Meanwhile on 20 October 2020, the Plaintiff applied for a stay of the execution of the Enforcement Order, but was refused by the High court on 26 November 2020.

[14] Failing to obtain a stay of execution from the High court, the Plaintiff filed a Notice of Motion on 30 November 2020 in the court of Appeal pursuant to s 44 of the Courts of Judicature Act 1964 to stay the execution of the Enforcement Order. The court of Appeal heard the application on 19 January 2021 and dismissed the Notice of Motion.

[15] On 8 February 2021, the Defendant issued a demand notice pursuant to s 465(1)(e) and 466(1)(a) and (2) of the Companies Act, 2016 to demand payment of RM 13,841,691.60 calculated as at 8