2023 MarsdenLR 1242
HIGH COURT MALAYA SHAH ALAM
MUDAJAYA CORPORATION BHD – Appellant
Versus
KWSL BUILDERS SDN BHD & ANOTHER CASE – Respondent
[Originating Summons No: BA-24C-52-08/2022 & BA-24C-56-08/2022]
Adjudicators must adhere to natural justice principles, but failure to invite submissions on all issues is not a breach if parties could reasonably foresee them.
Headnote:The court analyzes whether adjudicators breached the second rule of natural justice under CIPAA, specifically examining if an adjudicator's decision warrants setting aside due to alleged procedural issues. The court concludes that the adjudicator abided by statutory obligations and party expectations, emphasizing that natural justice was upheld. The court determines that the applications are dismissed with conditions for a conditional stay of enforcement of the adjudication decision.
| Table of Content |
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| 1. plaintiff seeks court orders regarding adjudication decision and stay enforcement. (Para 1 , 2 , 3) |
| 2. background of disputes and previous adjudication decisions outlined. (Para 4 , 5) |
A. Three Novel Matters
[1] This judgment regarding the above two originating summonses (2 OS) discusses three novel issues as follows:
(1) to determine whether an adjudicator has breached the second rule of natural justice (2nd Rule) under s 15(b) read with s 24(c) of the Construction Industry Payment and Adjudication Act 2012 (CIPAA) when the adjudicator arrives at an adjudication decision, should our courts adopt the approach applied by Steven Chong Horng Siong JA in Singapore's Court of Appeal case of Glaziers Engineering Pte Ltd v. WCS Engineering Construction Pte Ltd [2018] 2 SLR 1311 and the three scenarios explained in that case (3 Scenarios)?;
(2) in an application for an absolute stay of the enforcement of an adjudication decision (Absolute Stay Application) pending the disposal of litigation or arbitration between the parties (Litigation/Arbitration), can the Court consider an oral application by learned counsel for a "conditional stay" of the enforcement of the adjudication decision pending the outcome of Litigation/Arbitration (Conditional Stay Application)?; and
(3) in the exercise of the Court's discretion to decide a Conditional Stay Application, whether the Court may consider the fact that there were previous Court orders under s 28(1) and (2) CIPAA which have allowed the enforcement of three earlier adjudication decisions between the same parties involved in the Conditional Stay Application.
B. 2 OS
[2] The 2 OS to be decided by this Court are as follows:
(1) Mudajaya Corporation Sdn Bhd (MCB) has filed OS No BA-24C-52-08/2022 (MCB's OS) against KWSL Builders Sdn Bhd (KSWL) for the following orders:
(a) an order to set aside an adjudication decision made on 29 July 2022 [Adjudication Decision (29 July 2022)] by an adjudicator, Mr Soh Lieh Sieng (Adjudicator), in favour of KWSL against MCB [Setting Aside Application (MCB's OS)]; and
(b) as an alternative to the Setting Aside Application (MCB's OS), an order to stay the enforcement of the Adjudication Decision (MCB's OS) [Absolute Stay Application (MCB's OS)] pending the disposal of a High Court suit filed by MCB against KWSL (MCB's Suit). MCB's Suit was initially filed in Kuala Lumpur High Court (KLHC) Civil Suit no: WA-22C-88-09/2020. By an order of KLHC, MCB's Suit had been transferred from KLHC to the Ipoh High Court (Civil Suit no: AA-22C-1-09/2021); and
(2) OS No BA-24C-13-02/2022 (KWSL's OS) has been filed by KWSL against MCB for leave of Court to enforce the Adjudication Decision (29 July 2022).
C. Background
[3] MCB had appointed KWSL to do the following sub-contract works (Works) in the same construction project (Project):
(1) in "Letter of Award" (LA) dated 20 July 2016, MCB had appointed KWSL to do "acoustic elements" works (Acoustic Elements Works);
(2) by way of LA dated 30 August 2016, MCB had appointed KWSL to perform infrastructural works (Infrastructural Works);
(3) KWSL was appointed by MCB in LA dated 18 October 2016 to supply and install reinforced concrete walkway (Walkway Works);
(4) in LA dated 31 October 2016, MCB had appointed KWSL to perform "architectural works" (Architectural Works); and
(5) by way of a LA dated 28 March 2017, MCB had appointed KWSL to supply manpower services for the Project (Manpower Supply).
[4] Disputes arose between MCB and KWSL regarding the Works. Consequently:
(1) MCB's Suit was filed;
(2) prior to the Adjudication Decision (29 July 2022), KWSL commenced three adjudication proceedings against MCB and obtained the following three adjudication decisions (3 Previous Adjudication Decisions):
(a) with regard to the Walkway Works, on 19 January 2022, Dr Wendy Ooi Su Ghee had adjudicated that MCB shall pay to KWSL a sum of RM500,736.24 [Adjudicated Amount (19 January 2022)] with interest and adjudication costs [Adju