KEBABANGAN PETROLEUM OPERATING COMPANY SDN. BHD. v Malaysia Marine And Heavy Engineering Sdn. Bhd.

w-02ca-1836-09-2022 Court of Appeal (Mahkamah Rayuan) 23 January 2025 • W-02(C)(A)-1836-09/2022 • 14 min read

3 cases cited (1 SG, 2 foreign)

Catchwords

Arbitration – Arbitration Act 2005 (“AA”) – Award – Recognition and enforcement of award Arbitration – Respondent was allegedly in breach of express and implied terms of contract in respect of supply of cost-plus valves and that Appellant suffered substantial loss and damages – Whether respondent was in breach of express terms of contract – Whether valves supplied did not correspond with its description and were not of merchantable quality – Whether Appellant suffered substantial loss and damage in respect of valves which had been replaced Arbitration - Whether breach of rules of natural justice occurred during arbitration and in connection with making award — Arbitral Tribunal addressed on issue not raised or addressed by parties — Tribunal failed to address issues specifically raised in the pleadings by the parties — Whether breach of natural justice — Whether award was in conflict with public policy of Malaysia Arbitration — Arbitral Tribunal — Expert evidence rejected by the Tribunal — Whether Tribunal bound to accept expert evidence — Whether Tribunal must give cogent reason in accepting or rejecting expert evidence — Whether s 33(3)(b) of AA is breached.

Practice Areas

Arbitration

Judges (3)

Azimah binti Omar Coram Mariana binti Haji Yahya Coram Utama Wan Ahmad Farid bin Wan Salleh Delivered

Counsel (7)

Mohanadass Partnership Firm Zul Rafique & Partners Firm Agesh Jeyaratnam Counsel Appellant Kalashini Sandrasegaran Counsel Respondent Mohanadass Kanagasabai Counsel Respondent Thomas Shaun Mathews Counsel Respondent Wilfred Abraham Counsel Appellant

Parties (2)

KEBABANGAN PETROLEUM OPERATING COMPANY Sdn Bhd Appellant Malaysia Marine And Heavy Engineering Sdn Bhd Respondent

Case Significance

KEBABANGAN PETROLEUM OPERATING COMPANY SDN. BHD. v Malaysia Marine And Heavy ... is a Court of Appeal (Mahkamah Rayuan) decision dated January 23, 2025 (citation: w-02ca-1836-09-2022). <p>Kebabangan Petroleum Operating Company appealed against the High Court's refusal to enforce an arbitral award and its setting aside of the award in favour of Malaysia Marine and Heavy Engineering Sdn Bhd (MMHE), arising from a dispute over supply of non-OMB manual ball valves of unknown origin. The Court of Appeal dismissed both appeals, finding that the arbitral tribunal had breached natural justice by failing to address MMHE's arguments on damages quantification, waiver and estoppel, and mi The panel comprised Azimah binti Omar, Mariana binti Haji Yahya and Utama Wan Ahmad Farid bin Wan Salleh, with Utama Wan Ahmad Farid bin Wan Salleh delivering the judgment. Counsel appearing: Agesh Jeyaratnam (counsel for appellant), Kalashini Sandrasegaran (counsel for respondent), Mohanadass Kanagasabai (counsel for respondent), Thomas Shaun Mathews (counsel for respondent), Wilfred Abraham (counsel for appellant).

Key issues: Arbitration – Arbitration Act 2005 (“AA”) – Award – Recognition and enforcement of award.

Summary

Kebabangan Petroleum Operating Company appealed against the High Court's refusal to enforce an arbitral award and its setting aside of the award in favour of Malaysia Marine and Heavy Engineering Sdn Bhd (MMHE), arising from a dispute over supply of non-OMB manual ball valves of unknown origin. The Court of Appeal dismissed both appeals, finding that the arbitral tribunal had breached natural justice by failing to address MMHE's arguments on damages quantification, waiver and estoppel, and mitigation of loss.

What was the outcome of KEBABANGAN PETROLEUM OPERATING COMPANY SDN. BHD. v Malaysia Marine And Heavy ...?

<p>Kebabangan Petroleum Operating Company appealed against the High Court's refusal to enforce an arbitral award and its setting aside of the award in...

Statutes Cited

Arbitration Act 2005 (Cap 646)

s 37

Cases Cited (3)

SLR (1)

[2008] 2 SLR(R) 491

MY (2)

[1993] 1 MLJ 182 [2019] 2 MLJ 413