CIPAA Consulting News & Update Background

CASE UPDATE: Direct Payment from Principal under CIPAA cannot be contractually prohibited

B Cor Geotechnics Sdn Bhd v Panzana Enterprise Sdn Bhd [2019] MLJU 1030 In this case, the High Court confirmed that the Principal cannot seek refuge under the provision in the Construction Contract to prohibit the direct payment to any third parties to prevent the Winning Party of CIPAA Adjudication from seeking direct payment from the Principal pursuant to Section 30 of Construction Industry Payment and Adjudication Act 2012 (CIPAA). As a result, the Winning Party may compel the Principal to make direct payment of the Adjudicated Sum as long as there is money due and payable from the Principal

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CASE UPDATE: CIPAA Applies Prospectively

Jack-in Pile (M) Sdn Bhd v. Bauer (Malaysia) Sdn Bhd & Another Appeal [2020] 1 CLJ 299 Ireka Engineering & Construction Sdn Bhd v. PWC Corporation Sdn Bhd & Other Appeals [2020] 1 CLJ 193 The Federal Court, being the apex court of Malaysia, recently found that the provisions of CIPAA affect the substantive rights of the parties. As such, in accordance with the doctrine of statutory interpretation, the Federal Court ruled that CIPAA should not be interpreted retrospectively so as to impair an existing right or obligations. Instead, CIPAA should be interpreted prospectively. What does this mean? As a

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CIPAA Consulting News & Update Background

CASE UPDATE: Enforcement of CIPAA Decision by Direct Payment before Certification

B Cor Geotechnics Sdn Bhd v Panzana Enterprise Sdn Bhd [2019] MLJU 1030 Upon the delivery of an Adjudication Decision, the Winning Party may enforce the Adjudication Decision by requesting for direct payment from the Principal of Losing Party pursuant to Section 30 of Construction Industry Payment and Adjudication Act 2012 (CIPAA).  Read more at: Enforcement of CIPAA Adjudication Decision The Principal is statutory bound to make direct payment to the Winning Party if there is money due or payable by the Principal to the Losing Party at the time of the receipt of the written request for direct payment. 

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CIPAA Consulting News & Update Background

CASE UPDATE: CIPAA Adjudication Decision as The Basis of Winding Up without Enforcement Application

Likas Bay Precinct Sdn Bhd v Bina Puri Sdn Bhd [2019] 3 CLJ 499 In this case, the Court of Appeal ruled that the winning party in a CIPAA Adjudication Proceeding may proceed to issue a Statutory Notice of Demand under Section 466 of Companies Act 2016 (“466 Winding Up Notice”) to demand payment based on the Adjudication Decision without enforcing it as if it is a judgment or order of the High Court pursuant to Section 28 of CIPAA. In the event that the losing party fails to meet the demand and pay the adjudicated sum, the winning party

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CIPAA Consulting News & Update Background

CASE UPDATE: CIPAA Claim can only be Initiated After the Due Date of Payment

Ideal City Development Sdn Bhd v PWC Bina Sdn Bhd & Other Appeals [2019] 2 CLJ 615 In this case, the Court of Appeal ruled that an Unpaid Party / Claimant can only bring a CIPAA claim against the Non-Paying Party / Respondent after the due date of payment provided in the contract. As a result, if an Unpaid Party / Claimant brings an action against the Non-Paying Party / Respondent before the due date of payment: the Adjudicator may refuse to decide on the matter on the ground that the Adjudicator does not have jurisdiction to adjudicate payment which

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CIPAA Consulting News & Update Background

CASE UPDATE: Non-Compliance with the Basic and Essential Requirement of Payment Claim is Fatal

SKS Pavillion Sdn Bhd v Tasoon Injection Pile Sdn Bhd [2019] 9 MLJ 396 This High Court’s decision highlighted the importance for an Unpaid Party to strictly comply with the requirement of CIPAA in the filing of a CIPAA Payment Claim. The High Court set aside the CIPAA Adjudication Decision as the Payment Claim did not state the due date of payment. Background Facts In this case, the Contractor had mounted a CIPAA claim against the Owner of the Project. The Adjudication Decision was rendered in the Contractor’s favour. Subsequently, the Owner of the Project sought to set aside the CIPAA

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CIPAA Consulting News & Update Background

CASE UPDATE: The Failure to file CIPAA Payment Response does not preclude the raising of New Defences in Adjudication Response

View Esteem Sdn Bhd v Bina Puri Holdings Bhd [2018] 2 MLJ 22
By virtue of the Federal Court’s decision, there is no repercussion to a Non-Paying Party/ Respondent in not filing the Payment Response.

For strategic reason, the Non-Paying Party/Respondent may want to submit a scanty Payment Response or not submitting the Payment Response at all to preserve the element of surprise and ambush the Unpaid Party/Claimant at the Adjudication Response stage, bearing in mind that the Unpaid Party/Claimant only has 5 working days to file Adjudication Reply from the receipt of Adjudication Response.

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CIPAA Consulting News & Update Background

CASE UPDATE: Recommencement of CIPAA Proceeding if the Adjudication Decision is Set Aside

Wong Huat Construction Co v Ireka Engineering & Construction Sdn Bhd [2018] 7 MLJ 659

If an Adjudication Decision is successfully set aside pursuant to Section 15 of CIPAA, all parties will be restored to their original positions as though the earlier Adjudication did not take place.

As a result, the Unpaid Party / Claimant is entitled to re-commence a fresh CIPAA Proceeding instead of arbitrating / litigating the matter.

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