[1] This is the appellant/defendant's appeal against the decision of the High Court at Penang which entered judgment for the respondent/plaintiff. For ease of reference, in this judgment, parties will be referred to as they were in the High Court.

Background

[2] The plaintiff was appointed as the main contractor by Ann Joo Integrated Steel Sdn Bhd ("the employer") for the construction of Ore Bunker and Hot Stove at Prai Industrial Park ("the project") at an accepted tender price of RM3,000,000.00. The liquidated and ascertained damages payable by the plaintiff to the employer in the event of delay in the completion of the project was RM6,000.00 per day.

[3] By a letter dated 25 June 2008, the plaintiff appointed the defendant as its subcontractor for the said project. The total subcontract sum agreed by the plaintiff and the defendant was RM2,000,000.00. The other terms and conditions for the subcontract were:

(i) The defendant was to start work within two weeks from the date of the letter of award, namely on or before 8 July 2007;

(ii) The defendant was to complete the project within 16 weeks, namely on or before 27 October 2008; and

(iii) The liquidated and ascertained damages for the