JUDGMENT

Abdul Aziz Rahim J:

[1] This is the plaintiff's application for Mareva injunction to restrain the defendant from removing its assets from the jurisdiction of the court up to the amount stated in the ex parte summons in chambers dated 17 September 2007. Earlier, on the application by the plaintiff, the court has ordered ex parte ad interim injunction against the defendant on 23 October 2007. Today is for inter partes hearing of the plaintiff's application and for the court to decide whether or not the ex parte ad interim injunction should stay or otherwise.

Background Facts

[2] Javel Engineering Sdn Bhd ("the main contractor") was awarded a contract to design, construct, complete and maintenance of the 3 Bay Bomba Station and staff quarters at Sibu, Sarawak under Contract No. JBPM/T/12/2000 ("project") including the building works. The defendant was appointed as the subcontractor to the main contractor for the project. The defendant then appointed the plaintiff as its subcontractor to the project to carry out the building works portion of the entire of the project by a letter of award dated 11 January 2003; and this was later followed by an agreement dated 1 October 2003. Under the agreement, the original completion date for the plaintiff's works was 12 February 2004. The plaintiff duly and properly performed its contractual obligation under the agreement.

[3] On 25 February 2005 the main contractor issued a notice of termination to the defendant to terminate the defendant's employment as subcontractor to the project and to terminate contract with the defendant.

[4] On 21 March 2005 the defendant informed the plaintiff that the main contractor had terminated the defendant's employment and the contract and hence the defendant would have to cease all operations and vacated the project site as well. Accordingly the plaintiff was asked by the defendant to automatically cease all operations and vacate the site. The plaintiff's appointment as defendant's subcontractor for the project was thus deemed automatically terminated.

[5] It is not disputed that on or before 21 March 2005 that is before the termination, there were already disputes and differences between the plaintiff and the defendant in relation to delay or failure to pay certified progress payments, non-valuation of works carried out by the plaintiff, and disagreement on variation works and non-evaluation of loss and expenses claims for extended period of the plaintiff's works.

[6] The plaintiff consequently issued a notice of arbitration dated 5 September 2007 to refer the disputes to arbitration pursuant to an arbitration clause under the agreement. In the arbitration proceedings, the plaintiff is claiming a sum of RM2,404,364.24 with a reservation of its right on the issue of the plaintiff's termination. The liquidated claim by the plaintiff before the arbitrator consist of the following sums:

(a) RM820,169.63 for the balance of the outstanding sums due and owing for the plaintiff works done by the plaintiff arising from interim certificates of payment and the joint measurement of works carried out on 29 March 2007;

(b) RM60,427.30 for the bakau piling variation works completed by the plaintiff;

(c) RM1,523,767.30 for the plaintiff's loss and expense incurred during the extended period of the plaintiff's works from 13 February 2004 till 22 March 2005.

[7] The arbitration proceedings are currently at its initial stages whereby the parties are in the process of nominating an arbitrator.

[8] After the termination however, on or around 10 and 11 August 2007 the plaintiff discovered that the defendant was actually still involved in the project as the subcontractor to the main contractor, Javel Engineering Sdn Bhd; even though, as it has been shown earlier, that the contract between the main contractor and the defendant had been terminated. This discovery was quite accidental. The discovery was by way of a discovery of a winding up petition filed by one Goodwood Trans