KINU SDN. BHD. Kerajaan Malaysia (Jabatan Kerja Raya Malaysia)

KINU SDN. BHD. Kerajaan Malaysia (Jabatan Kerja Raya Malaysia)

JKR qualified as the "principal" under s4 CIPAA; the undisputed retention/performance guarantee constituted money "due or payable" or at least "payable" under s30(5) at the time the subcontractor's s30(1) request was made; JKR failed to discharge its evidential burden (did not serve s30(2) notice and did not produce Certificate of Termination Costs), permitting an adverse inference; accordingly direct payment under s30(3) was ordered to satisfy the adjudicated amount.

Citation
W-01(C)(A)-523-08/2024 (Mahkamah Rayuan)
Parties
Appellant / Plaintiff: Kinu Sdn. Bhd.; Respondent / Defendant: Kerajaan Malaysia (Jabatan Kerja Raya Malaysia)
Court
C
Jurisdiction
Malaysia
Judgment Date
24 March 2025
Case Number
W-01(C)(A)-523-08/2024 (Mahkamah Rayuan)
Procedural Posture
Civil Appeal CIPAA S30 Enforcement / Court of Appeal Judgment
Outcome
Appeal allowed; High Court order dismissing s30 application set aside; direct payment order granted in favour of appellant
Legal Topics
CIPAA S30 Direct Payment, Retention Sum / Performance Guarantee, Adjudication Enforcement (s28), Privity and Subcontracting, Evidential Burden and Adverse Inference
Source Language
Malay/English
Construction Law Contract Law Statutory Adjudication Evidence Law Public Law CIPAA S30 Direct Payment Retention Sum / Performance Guarantee Adjudication Enforcement (s28) +2 more

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Parties

Kinu Sdn. Bhd.

Appellant / Plaintiff

Kerajaan Malaysia (Jabatan Kerja Raya Malaysia)

Respondent / Defendant

Procedural Posture

Civil Appeal CIPAA S30 Enforcement / Court of Appeal Judgment

Legal Issues

  1. 1 Whether retention sum retained by the principal is money "due or payable" under s 30(5) CIPAA
  2. 2 Whether principal may refuse direct payment under s30 on ground it did not consent to subcontracting
  3. 3 Whether principal discharged evidential burden by failing to serve s30(2) notice or produce Certificate of Termination Costs

Ratio Decidendi

JKR qualified as the "principal" under s4 CIPAA; the undisputed retention/performance guarantee constituted money "due or payable" or at least "payable" under s30(5) at the time the subcontractor's s30(1) request was made; JKR failed to discharge its evidential burden (did not serve s30(2) notice and did not produce Certificate of Termination Costs), permitting an adverse inference; accordingly direct payment under s30(3) was ordered to satisfy the adjudicated amount.

Court Disposition

Appeal allowed; High Court order dismissing s30 application set aside; direct payment order granted in favour of appellant

Orders

  • Direct payment by Kerajaan Malaysia (JKR) to Kinu Sdn. Bhd. of adjudicated amount RM927300.00
  • Interest on adjudicated sum at 5% per annum from 13/04/2023 until settlement