ASIAN INTERNATIONAL ARBITRATION CENTRE v 1. ) ONE AMERIN RESIDENCE SDN BHD 2. ) CHOON HON LENG 3. ) RAGAWANG CORPORATION SDN BHD 4. ) MENTERI KERJA RAYA 5. ) MENTERI DALAM JABATAN PERDANA MENTERI (UNDANG-UNDANG)

Case Significance

A significant Federal Court statement that section 34(1) of the Construction Industry Payment and Adjudication Act 2012 curtails judicial review over an arbitral institution’s statutory functions, subject to a good-faith condition.

This Federal Court decision resolves two appeals concerning the extent of the legal immunity enjoyed by the Asian International Arbitration Centre, formerly the Kuala Lumpur Regional Centre for Arbitration, an independent supranational arbitral institution established under the auspices of the Asian-African Legal Consultative Organization. The dispute arose from adjudication proceedings under the Construction Industry Payment and Adjudication Act 2012 between two Malaysian companies, in which the Centre performed statutory functions as the adjudication authority. The central question was whether the immunity from suit and legal process conferred on the Centre as an international organisation under the International Organizations (Privileges and Immunities) Act 1992 applied to judicial review proceedings brought against it in relation to its domestic and statutory functions under the 2012 Act. The Court examined the interaction between that immunity and section 34(1) of the 2012 Act, a statutory protection providing that no action or suit shall be instituted or maintained in any court against the Centre or its officers. Applying the principle that where statutory words are clear and admit of only one meaning there is no occasion for construction, and drawing on authority including R Rama Chandran v Industrial Court of Malaysia on the nature and curtailment of judicial-review jurisdiction, the Court held that judicial review may be curtailed by legislative intervention, and that section 34(1) was such an intervention. The Court of Appeal had also treated the immunity as conditional on the Centre acting in good faith in performing its functions, so that the protection was not absolute. In the result, per the judgment of the Court delivered by Abu Bakar bin Jais FCJ, the Centre could rely on section 34(1) to protect itself from suit, the words of the provision being clear. The judgment is a significant statement on statutory immunity and the limits of judicial review over an arbitral institution’s statutory functions.