Eunice Derek & Co.

On the court record

The firm's record illustrates whether a party's liquidation renders an arbitration agreement inoperative under section 10 of the Arbitration Act 2005, and the procedural safeguards governing actions against and injunctions affecting a liquidator.

Eunice Derek & Co. appears in the corpus as counsel in arbitration, insolvency and construction-related litigation, argued in the High Court (Mahkamah Tinggi) and the Court of Appeal (Mahkamah Rayuan).

One matter concerned a stay in favour of arbitration. Acting for the plaintiff, a company in liquidation, the firm appeared in litigation involving Ikano Johor Jaya Sdn Bhd where a stay of court proceedings was sought under section 10 of the Arbitration Act 2005 in respect of arbitration proceedings under a FIDIC form of contract, and the court examined whether there existed an arbitration agreement between the parties, and whether the fact that a party was in liquidation rendered that arbitration agreement null and void, inoperative or incapable of being performed.

The firm also appeared in insolvency-related litigation. Acting for the respondent in an appeal, it was engaged in a matter concerning the alleged misuse of the winding-up process and the statutory remedies under section 351 of the Companies Act 2016. In a related first-instance matter, acting for the defendant, it appeared where an interlocutory prohibitory injunction was sought, and the court considered the American Cyanamid principles, the absence of a necessary party where a liquidator had not been joined as a defendant, the need for leave to commence an action against a liquidator, the balance of convenience, and the potential impact on a turnkey construction agreement, together with the insufficiency of evidence of financial capacity to support an undertaking as to damages.

The firm's record is a commercial-litigation practice engaging the interaction of arbitration, insolvency and construction, particularly the effect of a party's liquidation on an arbitration agreement and the proper procedure for restraining or suing a liquidator. These matters sit at a recurring pressure point in commercial disputes, where a construction contract's arbitration clause meets the collective insolvency process, and the court must decide whether to hold the parties to their agreed forum or to allow the winding-up machinery to take its course, and whether the office of the liquidator is to be protected from suit or injunction except on strict conditions and with leave.