ASM Development (KL) Sdn Bhd Econpile (M) Sdn Bhd

ASM Development (KL) Sdn Bhd Econpile (M) Sdn Bhd

The Court granted a stay under s16(1)(b) CIPAA because the cumulative effect of factors—pending arbitration (initiated by respondent), a Fortuna injunction, existing enforcement steps (including writ of seizure and sale), a substantial counterclaim and set-off exceeding the adjudicated sum, and material doubts about the respondent's true ability to repay—constituted special circumstances and justified exercising judicial discretion to stay enforcement pending final arbitration determination.

Citation
W-02(C)(A)-2365-12/2019 (Mahkamah Rayuan)
Parties
Appellant: ASM Development (KL) Sdn Bhd; Respondent: Econpile (M) Sdn Bhd
Court
C
Jurisdiction
Malaysia
Judgment Date
26 April 2022
Case Number
W-02(C)(A)-2365-12/2019 (Mahkamah Rayuan)
Procedural Posture
Civil Appeal (construction Disputes) / Court of Appeal Judgment (stay Application)
Outcome
Appeal allowed in respect of stay; High Court refusal to grant stay set aside
Legal Topics
Stay of Adjudication Decision, Enforcement of Adjudication Decision, Fortuna Injunction, Statutory Demand (companies Act), Liquidated Damages, Set Off/counterclaim, Termination of Contract
Source Language
Malay/English
Construction Law Arbitration Company Law Contract Law Statutory Adjudication (cipaa) Stay of Adjudication Decision Enforcement of Adjudication Decision Fortuna Injunction +4 more

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Parties

ASM Development (KL) Sdn Bhd

Appellant

Econpile (M) Sdn Bhd

Respondent

Procedural Posture

Civil Appeal (construction Disputes) / Court of Appeal Judgment (stay Application)

Legal Issues

  1. 1 Whether a stay of enforcement of an adjudication decision under s16(1)(b) CIPAA should be granted pending arbitration
  2. 2 Whether the existence of a pending arbitration automatically warrants a stay
  3. 3 Whether the respondent has the financial capacity to repay the adjudicated sum if arbitration reverses the adjudication

Ratio Decidendi

The Court granted a stay under s16(1)(b) CIPAA because the cumulative effect of factors—pending arbitration (initiated by respondent), a Fortuna injunction, existing enforcement steps (including writ of seizure and sale), a substantial counterclaim and set-off exceeding the adjudicated sum, and material doubts about the respondent's true ability to repay—constituted special circumstances and justified exercising judicial discretion to stay enforcement pending final arbitration determination.

Court Disposition

Appeal allowed in respect of stay; High Court refusal to grant stay set aside

Orders

  • Stay of enforcement of the adjudication decision granted under s16(1)(b) CIPAA pending final determination by arbitration
  • High Court order dated 29 November 2019 set aside insofar as it refused the stay