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2023 MarsdenLR 342
HIGH COURT (KUALA LUMPUR)
ALIZA SULAIMAN, J
TUV SUD (M) Sdn Bhd – Plaintiff
Versus
Intisari Mulia Engineering Sdn Bhd and another summon – Defendant
ORIGINATING SUMMONS NO WA-24C-129-06 OF 2022 AND WA-24C-146-07 OF 2022
Wong Wai Sam (WS Wong & Co) in Originating Summons No WA-24C-129-06 of 2022 for the plaintiff.
Hussin bin Mohd Razak (Mohd Irwan Mohd Mubarak) in Originating Summons No WA-24C-146-07 of 2022 for the plaintiff.
Wong Wai Sam (WS Wong & Co) in Originating Summons No WA-24C-146-07 of 2022 for the defendant.
Hussin bin Mohd Razak (Mohd Irwan Mohd Mubarak) in Originating Summons No WA-24C-129-06 of 2022 for the defendant.
The court upheld that an adjudication decision is enforceable under CIPAA even where a written contract is not formally executed, provided there is sufficient evidence of an agreement and interactions between the parties.
Headnote:(A) Construction Industry Payment and Adjudication Act 2012 - Sections 2, 4, 5, 15(b), (c), (d), and 28 - Adjudication decision and jurisdiction - Enforceable construction contract established by correspondence and payments - Application to set aside adjudication decision dismissed as unsubstantiated - Enforcement of adjudication decision allowed. (Paras 23, 51, 68)
(B) Jurisdiction - Core jurisdiction can be raised at any stage - Adjudicator's determination on jurisdiction is subject to court's scrutiny - No error in Adjudicator proceeding with adjudication despite challenges - Natural justice not breached. (Paras 36, 59, 64)
Facts of the case:
The plaintiff TUV SUD (Malaysia) Sdn Bhd initiated enforcement of an adjudication decision of RM1,703,148.97 against defendant Intisari Mulia Engineering Sdn Bhd. The defendant sought to set aside the decision citing lack of written contracts and breach of natural justice.
Findings of Court:
The court determined that there exists an enforceable construction contract evidenced by multiple communications and invoices. The Adjudicator's determination was upheld.
Issues: The main issues pertained to the existence of a written agreement and whether the Adjudicator had jurisdiction to adjudicate the matter.
Ratio Decidendi: The court clarified the expansive interpretation of 'construction contract made in writing' under CIPAA, affirming that written agreements can include purchase orders and invoices. Additionally, the Adjudicator's power to adjudicate is not constrained by the formalities of a written contract, and procedural fairness was observed.
Result: Setting Aside Application dismissed; Enforcement Application allowed.
| Table of Content |
|---|
| 1. court consented to hear applications from both parties. (Para 1 , 2 , 3) |
| 2. detail of cause papers filed in the adjudication process. (Para 4 , 5 , 6 , 7 , 8 , 9 , 10 , 11 , 12 , 13 , 14) |
| 3. grounds for intisari's challenge to the adjudicator's decision. (Para 18 , 19 , 22) |
| 4. existence of a construction contract in writing is vital for adjudication. (Para 23 , 29 , 31 , 32) |
| 5. jurisdiction challenges may be raised during or post adjudication. (Para 36 , 52 , 58) |
| 6. the adjudicator ensured compliance with natural justice. (Para 63 , 66) |
| 7. court allowed enforcement application as conditions met. (Para 68 , 70) |
Aliza Sulaiman J:
GROUNDS OF JUDGMENT
Introduction
[1]The Court heard the following applications with the consent of the parties:
(a)the application by TUV SUD (Malaysia) Sdn Bhd (‘TUV’) pursuant to s 28Construction Industry Payment and Adjudication Act 2012 [Act 746] (‘CIPAA’)O.S. No. 129’) to enforce the Adjudication Decision dated 27.5.2022 (‘AD’) by the learned Adjudicator, Mr. Sivabalan Sankaran (‘Adjudicator’) (encl. 1; ‘Enforcement Application’); and
(b)the application by Intisari Mulia Engineering Sdn Bhd (‘Intisari’) pursuant to s 15(b), (c) and/ or (d)CIPAAO.S. No. 146’) to set aside the AD (encl. 1; ‘Setting Aside Application’).
[2]After having considered the cause papers and written submissions by the parties, the Court had, on 28.2.2023, dismissed the Setting Aside Application with cost of RM6,000.00 and allowed the Enforcement Application with cost of RM4,000.00. Both order as to costs are subject to allocator.
[3]Intisari, being aggrieved with the aforesaid decision, has since appealed against the same. The detailed reasoning for the decision is set out in the succeeding part of this judgment.
The Cause Papers
[4]The cause papers, except for encls. 1 in each application, are as follows:
O.S. No. 129: Enforcement Application
(a)TUV’s Affidavit In Support (‘AIS’) affirmed by its Sales Executive
(b)& Admin, Khaidil Azrol Bin Hazes @ Aziz on 23.6.2022 (encl. 2);
(c)Intisari’s Affidavit In Reply (‘AIR’) affirmed by its Director,
(d)Ronizain Bin Ismail on 21.7.2022 (encl. 4); and
(e)TUV’s AIR affirmed by the same deponent on 4.8.2022 (encl. 5).
O.S. No. 146: Setting Aside Application
(a)Intisari’s AIS affirmed by Ronizain Bin Ismail on 21.7.2022 (encl. 2);
(b)TUV’s AIR affirmed by Khaidil Azrol Bin Hazes @ Aziz on 11.8.2022 (encl. 6); and
(c)Intisari’s AIR affirmed by the same deponent on 25.8.2022 (encl. 7).
Background facts
[5]TUV is a private limited company incorporated in Malaysia with a business address at 6th Floor, Wisma Akademi Etiqa, No. 23, Jalan Melaka, 50100 Kuala Lumpur.
[6]Intisari is also a private limited company incorporated in Malaysia with its registered address at 38B, Jalan Jernai, Medan Idaman, Jalan Gombak, 53100 Kuala Lumpur and business address at No. 25, Jalan Putra Mahkota 7/8D, Putra Point Business Centre, Putra Heights Subang Jaya, Selangor.
[7]Aker Solutions Malaysia Sdn Bhd (‘Main Contractor 1’) had appointed TUV for the “Supply of manpower, equipment & consumables for NDT Inspection Services for Aker Solutions (M) Sdn Bhd at PFKZ Port Klang, Selangor” (‘Project 1’). TUV then appointed Intisari as its sub- contractor for the works in respect of Project 1.
[8]Apart from that, Air Products Malaysia Sdn Bhd (‘Main Contractor 2’) had also appointed TUV for the “Supply of manpower & equipment UTTG & MPI for Air Products Malaysia Sdn Bhd” (‘Project 2). Similarly, TUV subsequently appointed Intisari as its sub-contractor for the works for Project 2.
[9]The contracts between TUV and Intisari were claimed to be founded on Purchase Orders dated 22.5.2018 for Project 1 and Purchase Orders dated 21.7.2020 and 7.3.2020 for Project 2, respectively.
[10]According to TUV, the parties had agreed that Intisari would send invoices to Main Contractor 1 and Main Contractor 2 for the works done by TUV. Upon receipt of the payments for work done, Intisari would remit 95% out of the same to TUV and retain 5% as its co
