Lee Swee Seng J:

THE JUDGMENT

[1]The primary question for determination in this application is whether the principal of a contractor against whom an Adjudication Decision has been made, is required to make payments direct to the Claimant under the direct payment remedy provision under the Construction Industry Payment and Adjudication Act 2012 (“CIPAA”) for a debt which the principal owes its contractor.

[2]The Plaintiff was the Subcontractor in a construction project known as “The Mark”. The Defendant as the Developer appointed BHL Builders Sdn Bhd (“BHL Builders”) as the Main Contractor for the Project.

[3]In the Letter of Award dated 28.4.2014 (“the LOA”), the Plaintiff was awarded by BHL Builders the subcontract work of RM43,144,275.98 for the supply, construction and completion of super structure work (“the Subcontract”) as follows:

“Cadangan Membina Pangsapuri Perkhidmatan yang mengandungi:

1.2 Blok Pangsapuri Perkhidmatan dan Kemudahan-kemudahan:

a)Blok A sebanyak 189 Unit Pangsapuri Perkhidmatan dan Kemudahan-kemudahan (21 Tingkat)

b)Blok B Sebanyak 278 Unit Pangsapuri Perkhidmatan dan Kemudahan-Kemudahan (23 Tingkat)

2.1 Blok Podium (8 Tingkat) yang Mengandungi:

a)18 Unit Ruang Retail (Di Sebahagian Aras 1-2)

b)36 Unit Ruang Pejabat (Di Sebahagian Aras 3-4)

c)1 Unit Perpustakaan MPAJ (Di Sebahagian Aras 2)

d)Tempat Letak kereta dan Tempat Letak Motorsikal (Di Sebahagian Aras 1-4 dan Di Aras 5-8)

e)Tempat Letak Kereta Separa Bawah Tanah (Aras Separa Bawah Tanah 1-2)

f)Tempat Letak kereta Bawah Tanah (Aras Bawah Tanah 1-2)

Di Atas Lot PT 12382 dan PT 6571, Taman Bukit Segar, Mukim Ampang, Daerah Hulu Langat, Selangor Darul Ehsan Untuk Tetuan BHL Gemilang Sdn Bhd (“the Project”)”.

[4]The Plaintiff had obtained an Adjudication Decision dated 13.10.2016 in its favour against the Respondent in an Adjudication under the CIPAA.

Problem

[5]As BHL Builders failed to make payment under the Adjudication Decision, the Plaintiff issued and served on 22.11.2016 a statutory demand under the then section 218Companies Act 1965

[6]On 19.12.2016, the Plaintiff served on BHL Builders a Winding Up Petition vide Kuala Lumpur High Court Winding Up Petition No. WA- 28NCC-1063-12/2016 (“the Winding Up Petition”).

[7]There was no application filed by BHL Builders to set aside the Adjudication Decision. BHL Builders has applied to restructure itself under section 176Companies Act 1965

[8]Pursuant to section 30CIPAA

[9]The Defendant did not issue a notice under section 30(2)CIPAAshow proof of payment” to the Plaintiff, or to “state that direct payment would be made after the expiry of ten working dates of the service of the notice”. This is a mandatory requirement under section 30(2)

[10]There was also no response from the Defendant to the Plaintiff.

Prayer

[11]The Plaintiff then filed this application on 17.1.2017 under section 30CIPAAinter alia, a declaration that the Defendant is liable as the principal of BHL Builders Sdn Bhd to pay to the Plaintiff the outstanding amount due under the Adjudication Decision dated 13.10.2016.

[12]The Adjudication Decision was for the principal sum of RM9,065,335.67 (“the Adjudicated Sum”) made in favour of the Plaintiff in addition to a further legal costs of RM20,000.00 and the adjudication costs of RM86,591.82 (“the Legal and Adjudication Cost”) together with interests at the rate of 5% per annum on the Adjudication Sum from 19.7.2016 to 13.10.2016 (“the Adjudicated Amount”).

[13]This was to be paid by 21.11.2016.

Principles

Whether the requirements of direct payment from the Principal to the Claimant under section 30CIPAAhave been met

[14]Section 30 of the CIPAA expressly allows the Plaintiff, as the successful party in the adjudication, to claim payment of the Adjudicated Amount directly from the Defendant as the principal, where BHL Builders, the Respondent in the Adjudication, has failed to make payment.

[15]It is provided under Part IV of the CIPAA under “Enforcement of Adjudication Decision”. The other section is section 28section 29