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Federal Court Victory: Resisted Application for Leave to Appeal In Relation To High-Stakes Arbitration Dispute

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19 August 2024

T Kuhendran, Esther Tan and Delvin Singh Mangat from our Construction Dispute Resolution Practice Group have secured a conclusive victory in the significant legal battle involving a RM10 million Arbitration Award. Representing the Respondent, East Coast Economic Region Development Council (“ECERDC”), our team successfully resisted motions for leave to appeal to the Federal Court in connection with the setting aside of the Arbitration Award. The Applicant in the case was Multi-Spex Architects Sdn Bhd (“MSA”).

In March 2024, the Court of Appeal upheld the High Court’s decision in:-

1. allowing ECERDC’s application to enforce the Arbitration Award pursuant to section 38 of the Arbitration Act 2005 (the “AA 2005”) (“Enforcement Application”)

2. dismissing:
(a) MSA’s application to set aside the Arbitration Award pursuant to section 37 of the AA 2005 (“Setting Aside Application”).
(b) MSA’s application to adduce fresh evidence (“Fresh Evidence Application”) .
(c) MSA’s application to amend its Originating Summons (“Amendment Application”).

Of these 4 judgements, MSA sought leave to appeal against the decisions related to the Amendment Application and Setting Aside Application only.

With regards to the Amendment Applications, MSA proposed 3 leave questions which generally relate to whether the provisions of sub-section 37(1)(a) and 37(2)(b) of the AA 2005 entitle a party to file an amendment application.

In relation to the Setting Aside Application, MSA again proffered 3 leave questions, this time concerning the applicable test where an award conflicts with public policy specifically where a breach of natural justice has occurred.

Apart from arguing that the proposed leave questions do not fall within the ambit of section 96(a) Courts of Judicature Act 1964 and/or the test for leave enunciated in Terengganu Forest Products Sdn Bhd v Cosco Container Lines Co Ltd & Anor and other application [2011] 1 MLJ 25 (in that they are not novel questions arising for the first time on matters of general importance), ECERDC also argued that MSA’s motions for leave were moot and academic. MSA had only sought leave to appeal the decisions with regards to the Amendment Application and Setting Aside Application. Crucially, MSA did not seek leave to disturb the decision in the Enforcement Application. Thus, even if MSA was successful in appealing against the decision to set aside the Arbitration Award, it has not sought leave to overturn the decision to enforce the Arbitration Award.

After considering the relevant documents before it, and the submissions of counsels for the respective parties, the Federal Court found no merit in the motions for leave, and dismissed the same.

Zul Rafique & Partners proudly acknowledge T Kuhendran, Esther Tan, and Delvin Singh Mangat for their exceptional work in securing this outcome. We thank the client for their continued trust in us. We strive to act in the best interest of our clients and to navigate complex legal challenges effectively.

The High Court’s case is reported here - East Coast Economic Region Development v Multi-Spex Architects Sdn Bhd and another case [2022] 11 MLJ 761.

The Counsels for this case are:
 
T Kuhendran (Devan)
 
Esther Tan
 
Delvin Singh Mangat

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