The defendant was employed by Cosmopleks Sdn Bhd (the employer) as the main contractor for the construction of a project known as Raintree Terrace comprising 12 units of luxury condominium apartments at Jalan Wickham, Kuala Lumpur (the project). By a sub-contract agreement dated 6 August 1984 (the first sub-contract) entered into between the plaintiff and the defendant, the latter appointed the former as a sub-contractor to supply and install air-conditioning and ventilation systems for the project. By another sub-contract agreement dated the same date (the second sub-contract) entered into by the same parties, the plaintiff was again appointed as a sub-contractor to supply and install lift services for the project. The plaintiff alleged that the defendant had failed or refused to pay the plaintiff certain progress payments notwithstanding that such payments were duly certified by the authorized architect of the project. Hence the plaintiff instituted this civil suit on 11 February 1987 against the plaintiff.

In its writ endorsed with a statement of claim the plaintiff gave particulars of the progress payments which had been duly certified by the architect which can be summarized as follows:

(a) First sub-contract -- architects certificate of payment Nos 14,

18 and 20 totalling$ 332,013.60.

(b) Second sub-contract -- architects certificates of payment Nos 9,

10, 11, 13 and 20 totalling$ 56,250.

The plaintiff therefore claimed for an amount of $ 388,263.60 with interest at the rate of 8% pa from the date of judgment until the date of full settlement thereof and costs.

After the defendant had entered appearance on 3 March 1987, the plaintiff made an application by way of summons-in-chambers dated 18 March 1987 for leave to enter final judgment for the aforesaid amount pursuant to O 14 of the Rules of the High Court 1980 (RHC). In the supporting affidavit affirmed by Kan Tong Seng (Kan), the accountant of the plaintiff, it was asserted that the defendant was at the commencement of this action and still is justly and truly indebted to the plaintiff in the sum of$ 388,263.60 in respect of work done and services rendered and performed by the plaintiff pursuant to the two sub-contract agreements dated 6 August 1984. The defendant then went on to state the manner in which the plaintiff was appointed as sub-contractor and gave the particulars of the outstanding certified amount of $ 388,263.60 due and payable to the plaintiff by the defendant. The particulars given were the same as that averred in the plaintiffs statement of claim.

In response to the plaintiffs application for an O 14 judgment, the defendant applied by way of summons-in-chambers on 10 July 1987 for an order that all further proceedings in the civil suit be stayed pursuant to s 6 of the Arbitration Act 1952 as the plaintiff and the defendant by the sub-contracts had agreed that matters in respect of which this action was brought be referred to arbitration. In the supporting affidavit affirmed by Gan Ching Lim (Gan) affirmed on 20 May 1987 (which must be read with the corrective and further affidavit of Gan affirmed on 6 August 1987 as in this affidavit Gan made some corrections to his earlier affidavit), it was asserted that cl 22 of the two sub-contracts provided:

that in the event of any dispute or difference between the contractor

and sub-contractor whether arising during the execution or after the

completion or abandonment of the sub-contract works or after the

determination of the employment of the sub-contractor under this

sub-contract (whether by breach or in any other manner) in regard to

any manner or thing of whatsoever nature arising out of this

sub-contract or in connection therewith then either party shall give to

the other notice in writing of such dispute or difference and such

dispute or difference shall be and is hereby referred