In this case, the High Court made a declaration that the Non-Paying Party can only ‘zerorize’ the Unpaid Party’s claim but not to the extent where the Unpaid Party would be made to pay the Non-Paying Party.
The High Court further declared that the Non-Paying Party may only raise LAD claim as a defence to the Unpaid Party’s claim and not a stand-alone counterclaim.
As a result of the High Court’s declaration, the Non-Paying Party could not possibly have a positive claim against the Unpaid Party.
Any set-off, deduction or counterclaim introduced by the Non-Paying Party (such as LAD, rectification costs advance payment) can only operate to ‘zerorise’ the Unpaid Party’s claim.
The Unpaid Party would NOT be made to pay the Non-Paying Party in the CIPAA Proceeding even if the set-off, deduction or counterclaim is greater than the CIPAA Payment Claim amount.