[1] This was an appeal by Kosbina Konsult (K) Sdn Bhd ("the appellant") against the decision of the High Court in allowing Madu Jaya Development Sdn Bhd's ("the respondent") claim for inter alia certain monies that the appellant obtained from the Government of Malaysia ("the Government").

[2] We had unanimously allowed the appeal. These are our full reasons.

The Background Facts

[3] On 12 June 2003, the appellant was awarded a contract by the Government for a project known as 'Naik Taraf Laluan Persekutuan 136 Dari Persimpangan Jalan Masuk ke Lebuhraya Utara/Selatan Hingga Bandar Baru (Km 42-Km 50)' ("the main contract").

[4] By way of a subcontract dated 5 May 2004 entered into between the appellant and Danaukhas Holdings Sdn Bhd ("Danaukhas") (now in liquidation), the entire works of the main contract was awarded to Danaukhas. The terms of the subcontract between the appellant and Danuakhas, inter alia was that the appellant was entitled to 10% commission of th