The court affirmed the adjudicator's jurisdiction and the validity of the payment decision under the CIPAA, denying claims for set-off and enforcing payment.

Introduction

[1] There were two appeals before us filed by Ireka Engineering and Construction Sdn Bhd ("the appellant"). The first appeal was against the decision of the High Court in allowing the application by PWC Corporation Sdn Bhd ("the respondent") under s 28 of the Construction Industry Payment and Adjudication Act 2012 ("the CIPAA") to enforce the adjudication decision dated 5 June 2017. The second appeal was against the dismissal of the appellants application under s 15 of the CIPAA to set aside the adjudication decision. For reasons set out below, we had unanimously dismissed the appellants appeals.

Background Facts

[2] By a subcontract dated 6 July 2010, the appellant had appointed the respondent as its subcontractor for a project known as "Cadangan Membina Sebuah Bangunan Komersil 26 Tingkat Yang Mengandungi Komplek Membeli-Belah, Ruang Tempat Letak Kereta, Pusat Konvensyen/Kemudahan- Kemudahan Dan Bilik-Bilik Hotel Di Atas Sebahagian Lot TL 077579394 (LA 20-01070435), Sandakan Harbour Square, Daerah Sandakan, Bandar Sandakan, Sabah untuk ICSD Venture Sdn Bhd" ("the project") for a contract sum of RM3,380,000.00.

[3] Under the subcontract, the respondent was to provide skilled labour, material, tools, equipment and the necessary machineries for the execution and completion of the design, fabrication, supply and installation of aluminium glazed windows and doors, lourves panel, feature fins and canopies for the project ("the subcontract work"). Outside the scope of the subcontract work, the respondent had also undertaken to do additional work.

[4] Among the pertinent provisions of the subcontract are cls 3.2 and 9.1 of the letter of award. Clause 3.2 provides:

"The Sub-Contract Sum is based on the attached Provisional Bill of Quantities. The Quantities given are for guidance only. The Final Subcontract sum shall be calculated based on the remeasurement of the actual works properly executed and completed on site."

[5] Clause 9.1 states:

"Notwithstanding any other provision in the Sub-Contract, the Main Contractor shall be entitled to deduct from or set-off any money due to or becoming due to the Sub-Contractor (including any Retention Money) any sum or sums which the Sub-Contractor is liable to pay the Main Contractor whether under this Sub-Contract or otherwise or any other contract between the parties."

[6] Clause 16.1 of the Agreement and Conditions of the Sub-Contract reads:

"If the Sub-Contractor fails to complete the Works by the Completion Date(s), the Contractor shall issue a Certificate of Non-Completion (with a copy to the Consultant) stating that in his opinion, the Works (or any section of the Works) ought reasonably so to have been completed. The Contractor shall then be entitled to set-off a sum for any loss and/or expenses suffered or incurred by the Contractor, after taking into consideration the apportioning of liability where the delays may also be caused by the Contractor and other subcontractors. As an alternative to loss and/or expense, the parties may agree to the amount of Liquidated Damages stated in Appendix A. The loss and/or expense or any Liquidated Damages shall be set-off by the Contractor under cl 26.9."

[7] The amount of Liquidated Damages stated in Appendix A was RM8,500.00 per day and the completion date for the subcontract work and the additional work was on 28 February 2011. The respondent failed to complete the works on 28 February 2011. The appellant issued a certificate of non-completion dated 1 March 2011 ("CNC"). The CNC was served on the respondent five years later, on 29 April 2016. The respondent lodged a police report on the CNC, contending that it was an afterthought and that it was backdated by the ap