KTCC Mall Sdn. Bhd. TCS CONSTRUCTION SDN. BHD.

KTCC Mall Sdn. Bhd. TCS CONSTRUCTION SDN. BHD.

The court held that TCS met the statutory conditions under s.30 CIPAA: s.30 creates an independent statutory obligation on the principal to pay the adjudicated sum (as per CT Indah) which does not necessarily conflict with insolvency pari passu rules where payment is not from the wound-up company's assets; the s.30(1) request was not defective because remedies may be exercised concurrently under s.31 and the obligation to pay the adjudicated sum is immediate; KTCC failed to discharge its evidential burden to show no monies were due or payable at the time of request; and the adjudicated amount includes interest and costs.

Citation
BA-24C-7-01/2023 (Mahkamah Tinggi)
Parties
Applicant/plaintiff: TCS CONSTRUCTION SDN BHD; Respondent/defendant: KTCC MALL SDN BHD
Court
High Court
Jurisdiction
Malaysia
Judgment Date
12 January 2024
Case Number
BA-24C-7-01/2023 (Mahkamah Tinggi)
Procedural Posture
Originating Summons (cipaa S.30) / Judgment Following Heard Together Originatings Summonses
Outcome
Plaintiff's (TCS) s.30 CIPAA application allowed; Defendant's (KTCC) resistances and declaratory relief dismissed; court finds KTCC liable under s.30 to pay adjudicated amount including interest and costs and obliged under its Letter of Undertaking.
Legal Topics
CIPAA S.30 Direct Payment, Pari Passu and Undue Preference, Notice and Timing Under S.30, Retention Sums and Performance Bond, Adjudicated Amount Including Interest and Costs, Letter of Undertaking
Source Language
Malay/English
Construction Law Insolvency Law Statutory Adjudication Contract Law CIPAA S.30 Direct Payment Pari Passu and Undue Preference Notice and Timing Under S.30 Retention Sums and Performance Bond +2 more

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Parties

TCS CONSTRUCTION SDN BHD

Applicant/plaintiff

KTCC MALL SDN BHD

Respondent/defendant

Procedural Posture

Originating Summons (cipaa S.30) / Judgment Following Heard Together Originatings Summonses

Legal Issues

  1. 1 Whether s.30 CIPAA invocation contravenes pari passu/undue preference in insolvency of main contractor
  2. 2 Whether the s.30(1) written request was defective for being made within 14 days
  3. 3 Whether plaintiff discharged legal burden to show monies were due or payable by principal to main contractor at time of request

Ratio Decidendi

The court held that TCS met the statutory conditions under s.30 CIPAA: s.30 creates an independent statutory obligation on the principal to pay the adjudicated sum (as per CT Indah) which does not necessarily conflict with insolvency pari passu rules where payment is not from the wound-up company's assets; the s.30(1) request was not defective because remedies may be exercised concurrently under s.31 and the obligation to pay the adjudicated sum is immediate; KTCC failed to discharge its evidential burden to show no monies were due or payable at the time of request; and the adjudicated amount includes interest and costs.

Court Disposition

Plaintiff's (TCS) s.30 CIPAA application allowed; Defendant's (KTCC) resistances and declaratory relief dismissed; court finds KTCC liable under s.30 to pay adjudicated amount including interest and costs and obliged under its Letter of Undertaking.

Orders

  • KTCC Mall Sdn Bhd to pay TCS Construction Sdn Bhd the adjudicated sum of RM6,141,557.77 together with interest at 5% per annum from 4 July 2020 until full payment
  • KTCC Mall Sdn Bhd to honour the Letter of Undertaking dated 19 September 2018 in relation to the Project