MAYFAIR VENTURES SDN BHD v SETIAKON BUILDERS SDN BHD

Case Significance

Instructive on the relationship between setting aside and enforcing an adjudication decision under the Construction Industry Payment and Adjudication Act 2012, showing that a partial excess of the adjudicator's jurisdiction correspondingly reduces the sum enforceable under section 28.

This Court of Appeal decision concerns the enforcement of an adjudication decision as a judgment under section 28 of the Construction Industry Payment and Adjudication Act 2012, and was heard and decided together with a related appeal against the dismissal of an application to set the same decision aside. The appellant, Mayfair Ventures Sdn Bhd, appealed against the High Court's decision allowing the respondent, Setiakon Builders Sdn Bhd, the main contractor under a letter of award incorporating a PAM form of contract, to enforce the adjudication decision under section 28 as if it were a judgment or order of the High Court. Because the enforcement appeal and the set-aside appeal turned on the same adjudication decision, the outcome of the enforcement appeal followed from the court's analysis of the adjudicator's jurisdiction. The court, comprising Azmi bin Ariffin, Mohd Firuz bin Jaffril and Ong Chee Kwan JJCA, identified two components in the respondent's underlying claim: a claim for pure late-payment interest on work done under certificates that had already been fully settled, and a claim for work done and interest under other certificates. It held that the stand-alone late-payment interest claim did not fall within the definition of 'payment' in section 4 of the Act, so that the adjudicator had exceeded her jurisdiction in allowing it, while the balance of the claim disclosed no appealable error. Since an adjudication decision may be enforced only to the extent that it is validly made, the jurisdictional excess affected the sum that could be enforced. The court accordingly allowed the enforcement appeal in part and varied the amount ordered under the enforcement application on the same terms as in the related set-aside appeal, reducing it by RM1,610,732.87, with costs of RM20,000. The judgment is instructive on the relationship between setting aside and enforcing an adjudication decision, and on how a partial excess of jurisdiction correspondingly limits the sum enforceable under section 28.