2011 MarsdenLR 2001

LAU BEE LAN
PATI SDN BHD – Appellant
Versus
HASRAT USAHA SDN BHD – Respondent

A sub-contractor can enforce completion claims against a main contractor despite claims of a back-to-back payment model; the burden of proof lies on the party alleging the arrangement when evidence contradicts it.

Headnote:(A) Sub-contract Law - Construction Contracts - Clauses governing payments and performance - The Plaintiff was permitted to claim RM729,780.36 as outstanding due after providing evidence of works completed under a project. The Defendant was entitled to a counterclaim of RM1,820,000 for liquidated damages due to delays in project completion. (Paras 2, 9, 10, 12, 14)

(B) Burden of Proof - Balance of probabilities - The Plaintiff must establish its claim on a balance of probabilities; the court should assume the evidence presented is correct when the opposing party fails to present any. (Paras 5, 10.2)

(C) Back-to-back payment agreements - A contractual arrangement must explicitly state conditions on payment to be enforceable; failure to do so means the Defendant must honor payments to the Plaintiff notwithstanding claims of prior settlements. (Paras 14, 15, 22)