Announcement

Zul Rafique & Partners successfully obtained judgment in the High Court acting for the Main Contractor against a Sub-Contractor providing scaffolding services in a final account dispute over RM10 million in value

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8 September 2021

Please click HERE for the Mandarin version of the case update.

T Kuhendran and Daniel Lau from Zul Rafique & Partners’ Construction Dispute Resolution Practice Group, acting for the Plaintiff, Aston Star Sdn Bhd, have successfully obtained judgment in favour of the Plaintiff in the Construction High Court of Kuala Lumpur.

The background of the dispute is as follows: the Plaintiff was the main contractor for a project to construct a mixed development of commercial, office and residential service apartments in Johor Bahru. The Defendant was a sub-contractor appointed to provide services relating to scaffolding works.

The primary issue was over the value of the scaffolding services provided by the Defendant. Over the course of the works, the Defendant submitted numerous invoices claiming payment which were purportedly supported by documents labelled ‘requisition forms’ and ‘daily work completion reports’. However, many of these invoices were submitted late, oftentimes months after the scaffolding works they purport to claim payment for had been dismantled and removed.

Key to the dispute was the fact that scaffolding, unlike other permanent construction works, are temporary works and would be dismantled and removed from the site. Consequently, scaffolding works would be incapable of re-measurement at a later date.

The High Court found that upon a reading of the sub-contract, the Defendant contractor was required to submit its claims for payment on a timely basis to be verified by the Plaintiff’s representatives at site. Having failed to do so, the High Court turned its attention to assess the Defendant’s claims and the supporting documents, which were eventually found to be wanting. The High Court emphasized the importance of keeping records, which would be assisted with photographic evidence of works done at the specific locations where works are alleged to have been done, amongst other defects in the documentary evidence provided by the Defendant.

Other issues raised related to the Defendant’s claim for manpower, and the inter-play between an adjudication decision and a subsequent final determination in a High Court decision. For context, the Defendant had initiated two adjudication proceedings, one of which was stayed and the other enforced and paid by the Plaintiff. The High Court decided that a final determination in the courts does not set aside the adjudication decision and consequently, issues of interest on any monies overpaid in an adjudication decision or costs awarded pursuant thereto are spent and cannot be re-opened in final determination.

Overall, the High Court awarded judgment in the Plaintiff’s favour and costs of slightly over half a million Ringgit and dismissed the Defendant’s counterclaim of slightly under three million Ringgit.

For more insight into this area of law, please contact our Partners in the Construction Dispute Resolution Practice Group:
Kuhendran Thanapalasingam
Susan Tan Shu Shuen

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