Aliza Sulaiman J:

GROUNDS OF JUDGMENT

Introduction

[1]In this application (encl. 1) by the Plaintiff for an order for injunctive reliefs against the Defendants to, among others, prevent the Defendants from complying with any demand or receiving or releasing the sum of RM24,828,868.80 (‘Said Sum’) in relation to the Performance Bond dated 11.3.2022 (‘PB’) which was issued by the 2^nd Defendant (‘D2’) in favor of the 1^st Defendant (‘D1’) pending the disposal of the arbitral proceedings between the Plaintiff and D1 (‘Proceedings’) on the ground of unconscionable conduct by D1, the Plaintiff had raised a novel issue involving s 410 of the Companies Act 2016CA 2016’).

[2]Apart from the usual issue which arises in applications under sub-s 11(1)Arbitration Act 2005Act 646] (‘AA 2005’) as to whether a defendant’s demand on the performance bond or bank guarantee is unconscionable, the issues in the present case include the questions on whether –

(a)the PB is a security over the Plaintiff’s property under paragraph 410(1)(b) CA 2016; and

(b)D1 can call for the PB during the pendency of a judicial management (‘JM’) proceeding, specifically the statutory moratorium phase under s 410 CA 2016

[3]On 14.7.2023, I had allowed the Plaintiff’s ex-parte application (encl.2 to restrain the Defendants from, among others, releasing the sums under the PB to D1 pending disposal of encl. 1.

[4]Two weeks later, the learned counsels representing the Plaintiff and D1 (as D2 was named as a nominal defendant and it took the position that it will abide by whatever Order that is made by the Court while the 3^rd Defendant (‘D3’) was made aware of the suit, but the Plaintiff chose not to serve encl. 1 on D3 as the Plaintiff’s stance was that the Counter Guarantee which was issued by D3 on 10.3.2022 for the Said Sum in favour of D2 (‘CG’) will not be affected, subject to any Order that will be made by the Court) appeared before the court and indicated their clients’ agreement for encls. 1 and 2 to be heard together.

[5]In addition, D1 did not object to the Plaintiff’s application for an Ad- Interim Injunction to preserve the status quo pending the disposal of encls. 1 and 2, subject to the usual undertaking by the Plaintiff. An order was accordingly made to this effect.

[6]After hearing the Plaintiff’s applications on 14.11.2023 and 14.12.2023 which was contested by D1 only, I had on 18.1.2024 allowed the Plaintiff’s application in encls. 1 and 2, specifically prayers A(2), B(4), B(5), B(6), B(7), C(9), C(10) and D(11) in encl. 1 with costs of RM20,000.00 to be paid by D1 to the Plaintiff, subject to allocatur.

[7]On 19.1.2024, D1 filed a Notice of Appeal against the entire decision. These are my full grounds of judgment for the appeal which is now scheduled for hearing on 29.4.2024.

The Cause Papers

[8]The cause papers are as follows:

(a)the Plaintiff’s Originating Summons (‘O.S.’) dated 14.7.2023 (encl. 1);

(b)the Plaintiff’s Ex-Parte Notice of Application dated 14.7.2023 (encl. 2);

(c)the Plaintiff’s Affidavit In Support (‘AIS’) affirmed by its Director, Chen Guohua on 14.7.2023 (encls. 3 and 4 in the English language and encl. 11 in the national language);

(d)the Plaintiff’s Certificate of Urgency affirmed by Mohd Rezan Ezra Bin Muhammad Mosinal, an advocate and solicitor in Messrs. Thomas Philip, the erstwhile firm which represented the Plaintiff (encl. 5);

(e)D1’s Affidavit In Reply (‘AIR’) affirmed by its local Director, Kok Jee Yin on 27.7.2023 (encl. 10);

(f)the Plaintiff’s AIR affirmed by the same deponent on 11.8.2023 (encl. 12);

(g)the Plaintiff’s Additional Affidavit affirmed by its Deputy General Manager, Zhu Yanbin on 24.10.2023 (encl. 30); and

(h)D1’s AIR affirmed by the same deponent on 1.11.2023 (encl. 31).

Background Facts

[9]By way of a Letter of Award dated 30.12.2021 (‘LoA’), D1 had appointed the Plaintiff as its contractor to carry out the works for package “C04A - Sub Structure & Superstructure for K1 and Ancillary Building” (‘Works’) for the contract sum of RM24