A stay of execution pending appeal requires the demonstration of special circumstances, particularly when previous applications have been dismissed on similar grounds under the Construction Industry Payment and Adjudication Act.

JUDGMENT

Wong Kian Kheong J:

(Court Enclosure No 9)

A. Introduction

[1] This judgment discusses the High Court's (HC) discretionary power pursuant to s 73 of the Courts of Judicature Act 1964 (CJA) and r 13 of the Rules of the of Appeal 1994 (RCA) to stay the execution of HC's order to enforce an adjudication decision (Enforcement Order) pending the disposal of an appeal to the Court of Appeal (CA) against the Enforcement Order.

[2] The interesting issue in this judgment is whether the test of "special circumstances" for HC to stay the execution of an Enforcement Order pending the disposal of an appeal to CA against the Enforcement Order, should be considered together with the following two unique features under the Construction Industry Payment and Adjudication Act 2012 (CIPAA):

(1) the object of CIPAA [Object (CIPAA)] is to ensure that parties who perform "construction work" (as defined in s 4 CIPAA) are not deprived of cash flow (the life-blood of the construction industry); and

(2) pursuant to s 16(1)(b) CIPAA, an appellant has previously applied to HC to stay the enforcement of the adjudication decision pending the disposal of a suit or arbitration between the parties [ Section 16 (1)(b) Stay Application] and HC has already dismissed the s 16(1)(b) Stay Application with costs.

B. Background

[3] The following two originating summonses (OS) had been filed:

(1) OS No BA-24C-103-10/2019 has been filed by Encorp Iskandar Development Sdn Bhd (Encorp) against Konsortium Ipmines Merz Sdn Bhd (Konsortium) for, among others, the following orders-

(a) an order to set aside an adjudication decision made on 26 September 2019 (AD) by an adjudicator, Mr Foo Joon Liang, in favour of Konsortium against Encorp (Encorp's Setting Aside Application). According to the AD, Encorp shall pay to Konsortium, among others, an adjudicated amount of RM13,861,784.16 (Adjudicated Amount); and

(b) an order to stay the enforcement of the AD until the disposal of an arbitration between Encorp and Konsortium (Arbitration) regarding their dispute which forms the subject matter of the AD [Encorp's s 16(1)(b) Stay Application); and

(2) Konsortium has filed OS No BA-24C-121-12/2019 against Encorp for leave of Court to enforce the AD against Encorp (Konsortium's Enforcement Application).

[4] The 2 OS have been heard together and I have decided as follows (HC's Order), among others:

(1) Encorp's Setting Aside Application and Encorp's s 16(1)(b) Stay Application are dismissed; and

(2) Konsortium's Enforcement Application is allowed.

The grounds for HC's Order are available at [2020] MLRHU 1242.

[5] Encorp has appealed to CA against HC's Order (Appeal).

[6] In respect of Konsortium's Enforcement Application, Encorp has filed an application in Court enclosure no 9 to stay the execution of the Enforcement Order pending the disposal of the Appeal (Encl 9).

C. Effect Of HC's Earlier Dismissal Of Encorp's Section 16 (1)(B) Stay Application

[7] It is not disputed that HC may exercise its discretion under s 73 CJA and r 13 RCA to grant a stay of execution of a judgment or order (Judgment/Order) pending the disposal of an appeal to CA against the Judgment/Order if an appellant can satisfy the Court that there exists special circumstances regarding the execution of the Judgment/Order (Special Circumstances Test) - please refer to the Federal Court's judgment delivered by Augustine Paul JCA (as he then was) in Kosma Palm Oil Mill Sdn Bhd & Ors v. Koperasi Serbausaha Makmur Bhd, , at 10, 17 and 18.

[8] With regard to an application to HC to stay the execution of an Enforcement Order pending the disposal of an appeal to CA against the Enforcement Order [Stay Application (Appeal)], I am of the following view:

(1) the Object (CIPAA) is clear from the Long Title to CIPAA ("to facilitate regular and timely payment, to provide a mechanism for speedy dispute resolution through adjudication, to provide for remedies for the recovery of payment in the construction industry") and has been recognized by our a