AKIRAN SERVICES SDN BHD v KPJ PERDANA SPECIALIST HOSPITAL SDN BHD

Case Significance

Reinforces the pro-enforcement policy of the Arbitration Act 2005: where none of the exhaustive grounds in section 39 is made out, an award will be registered under section 38 and enforced as a judgment, without the court reopening the merits decided by the tribunal.

This decision of the High Court's Commercial Division in Kuala Lumpur addresses the recognition and enforcement of an arbitration award. Two originating summonses concerning the same award, dated 21 August 2024, were heard together: one by a hospital company seeking to set the award aside, and this one, by the services company in whose favour the award had been made, seeking to register the award under section 38 of the Arbitration Act 2005 so that it could be enforced as a judgment of the court. Registration under section 38 is the ordinary route by which a successful party gives an award coercive effect, and section 39 sets out the limited and exhaustive grounds on which recognition or enforcement may be refused. Having first concluded that there was no basis under section 37 to set the award aside — finding no breach of natural justice and no procedural error, and that the arbitrator had decided within the scope of the arbitration and in accordance with the arbitration agreement — the court turned to registration. It held that none of the circumstances in section 39 that would justify refusing recognition had been shown, and that there was no reason why the award should not be registered and enforced as a judgment. The court underscored that recognition under the Act is close to automatic once the narrow refusal grounds are excluded, so that a party resisting enforcement bears the burden of bringing itself squarely within one of them. The court accordingly allowed the registration of the award, and ordered the party that had unsuccessfully sought to set it aside to pay costs, fixed at RM20,000 in total across both summonses and apportioned equally between them. The judgment reinforces the pro-enforcement policy of the Arbitration Act 2005: where no exhaustive statutory ground for refusal is made out, an award will be recognised and enforced, and the court will not reopen the merits decided by the tribunal.