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Malayan Law Journal Reports/2013/Volume 3/Sanlaiman Sdn Bhd MLJ &'' # 20 Septem(er 2012

!era"aan Malaysia # $2013% 3

1) pages $2013% 3 MLJ &''

Sanlaiman Sdn Bhd v Kerajaan Malaysia


HIGH COURT (KUALA LUMPUR) MOHAMA ARI!! " ORIGI#ATI#G SUMMO#S #O $%#CC(ARB)&'&($ O! $()$ $( Se*+em,er $()$ Arbitration -- Award -- Error of law -- Whether arbitrator's findings in award illogical or selfcontradictory -- Whether seemingly contradictory findings within award actually concerned proper findings on separate issues and did not render award erroneous *n the ground there was an error o+ law on the +a,e o+ an ar(itral award -.the award./0 the plainti++0 whi,h was the ,laimant in the ar(itration0 applied to the 1igh 2ourt under s 32 o+ the 4r(itration 4,t 200' to ha e the award set aside or aried or remitted (a,5 to the ar(itrator +or +urther a,tion6 7he plainti++ was appointed (y the de+endant as the main ,ontra,tor +or a ,onstru,tion pro"e,t and had re,ei ed se eral warning and reminder letters +rom the latter that the progress o+ its wor5 was slow and not in 5eeping with the time#line +or the pro"e,t.s ,ompletion6 7he plainti++ had applied +or two e8tensions o+ time ## respe,ti ely o+ +our months and three months ## to ,omplete0 (ut the de+endant only allowed one 30#day e8tension6 9espite granting the e8tension0 the de+endant issued the plainti++ a noti,e o+ de+ault and +ollowed that up with a ,erti+i,ate o+ non# ,ompletion -.2:2./0 a ,laim +or li;uidated and as,ertained damages -.L49./ and +inally a letter terminating the ,ontra,t6 7he plainti++ disputed the termination ,laiming it had ,ompleted more than <0= o+ the wor5s and re+erred the matter to ar(itration6 7he ar(itrator ruled0 inter alia0 that the plainti++ was entitled to ,omplete the pro"e,t within a reasona(le time as the time +or ,ompletion had (een set .at large. and that the de+endant.s issuan,e o+ the 2:2 and the imposition o+ L49 were wrong+ul and in alid6 1e0 howe er0 held the de+endant.s termination o+ the ,ontra,t was law+ul and alid6 7he plainti++ argued that it was illogi,al +or the ar(itrator to hold the termination to (e alid when he had already +ound that the time +or ,ompletion was set .at large.6 Held0 dismissing the ,laim with ,osts>

1) 1)

7here was no error o+ law on the +a,e o+ the award or arising out o+ the award -see para 3</6 7he ar(itrator had ,onsidered the e iden,e in relation to the +ailure to .pro,eed regularly and diligently with the wor5s. and ,ame to +irm +indings o+ +a,t on the e iden,e that the noti,e o+ de+ault and the su(se;uent termination was not mala +ide0 un,ons,iona(le or wrong+ul6 3 MLJ 7 at 7 ! 7he ar(itrator +ound the plainti++.s argument that .the 2:2 itsel+ would ha e superseded the e ent ,omplained o+ in the noti,e o+ de+ault. untena(le as they were (oth di++erent and unrelated pro isions in the ,ontra,t -see para 31/6

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1)

Seen in its entirety0 the +indings in the award were not illogi,al or in,onsistent6 7he ar(itrator ,ame to de+inite +indings on the e iden,e and +ound the issues o+ 2:2 and e8tension o+ time to (e separate +rom the issue o+ +ailure to pro,eed regularly and diligently with the wor5s whi,h a++orded a ,ause +or termination under ,l '1 o+ the ,ontra,t6 ?t ,ould not plausi(ly (e ,on,luded that on the +a,ts no reasona(le ar(itrator would ha e rea,hed the same ,on,lusions -see para 3&/6

4tas alasan terdapat 5esilapan undang#undang atas award tim(ang tara -.award./0 plainti+0 yang mana adalah penuntut di dalam tim(ang tara0 memohon 5epada Mah5amah 7inggi di (awah s 3245ta 7im(ang 7ara 200' untu5 award terse(ut di5etepi5an atau dipel(agai5an atau diremit (ali5 5epada penim(ang tara untu5 tinda5an selan"utnya6 Plainti+ dilanti5 oleh de+endan se(agai 5ontra5tor utama atau untu5 pro"e5 pem(inaan dan telah menerima (e(erapa amaran dan surat# surat peringatan daripada de+endan (ahawa 5ema"uan 5er"anya adalah perlahan dan tida5 mengi5ut dengan garis masa untu5 siap pro"e56 Plainti+ memohon untu5 dua pelan"utan masa masing#masing untu5 empat (ulan dan tiga (ulan # untu5 siap0 tetapi de+endan hanya mem(enar5an satu pelan"utan 30 hari6 @alaupun mem(eri5an pelan"utan terse(ut0 de+endan menyerah5an 5epada plainti+ notis 5eing5aran dan mengi5utinya dengan si"il tida5 siap -.2:2./0 tuntutan untu5 ganti rugi yang ditetap5an -.L49./ dan a5hirnya surat menamat5an 5ontra5 terse(ut6 Plainti+ memperti5ai5an penamatan terse(ut menda5wa ia telah siap5an le(ih daripada <0= 5er"a#5er"a dan meru"u5 per5ara terse(ut 5epada tim(ang tara6 Penim(ang tara memerintah5an0 antara lain0 (ahawa plainti+ (erha5 untu5 menyiap5an pro"e5 terse(ut dalam masa munasa(ah memandang5an masa untu5 siap telah ditetap5an .at large. dan (ahawa penyerahan 2:2 de+endan dan pengenaan L49 adalah salah dan ta5 sah6 9ia walau (agaimanapun0 memutus5an penamatan 5ontra5 oleh de+endan adalah sah di sisi undang# undang6 Plainti+ (erhu"ah (ahawa adalah tida5 logi5 untu5 penim(ang tara memutus5an penamatan adalah sah apa(ila (eliau telah mendapati (ahawa masa untu5 siap ditetap5an .at large.6 i*-+-s.an0 menola5 tuntutan dengan 5os>

2) 2)

2)

7ida5 terdapat 5esilapan undang#undang atas award atau (er(ang5it daripada award terse(ut -lihat perenggan 3</6 Penim(ang tara telah mempertim(ang5an 5eterangan (er5aitan 5egagalan untu5 .pro,eed regularly and diligently with the wor5s. dan 3 MLJ 7 at 7 7 men,apai 5epada dapatan +a5ta yang 5u5uh atas 5eterangan (ahawa notis 5eing5aran dan penamatan selan"utnya (u5an mala +ide0 tida5 (erpatutan atau salah6 Penim(ang tara mendapati hu"ahan plainti+ (ahawa .the 2:2 itsel+ would ha e superseded the e ent ,omplained o+ in the noti,e o+ de+ault. tida5 dapat dipertahan5an memandang5an 5edua#dua (er(eAa dan peruntu5an#peruntu5an yang tida5 (er5ait di dalam 5ontra5 -lihat perenggan 31/6 Melihat se,ara 5eseluruhannya0 dapatan dalam award adalah logi5 dan 5onsisten6 Penim(ang tara men,apai 5epada dapatan yang 5u5uh atas 5eterangan dan mendapati isu#isu 2:2 dan pelan"utan masa henda5lah diasing5an daripada isu 5egagalan untu5 menerus5an 5er"a#5er"a dengan 5erap dan (ersungguh#sungguh yang mana menye(a(5an penamatan di (awah 5lausa '1 5ontra56 ?a tida5 dapat disimpul5an dengan munasa(ah (ahawa atas +a5ta tiada penim(ang tara yang munasa(ah a5an men,apai 5esimpulan yang sama -lihat perenggan 3&/6

#/+es

Page 3 Bor a ,ase on error o+ law0 see 1-1/ Mallal's "igest -3th Cd0 Reissue/ para 1D)<6 Cases re0erred +/ Antaios #ia $a%iera &A % &alen 'ederierna A() *he Antaios $1<)3% 3 4ll CR 22<0 1L -re+d/ #airn Energy +ndia ,ty Ltd - Anor % *he .o%ernment of +ndia $200<% D MLJ &<'E $2010% 2 2LJ 3200 24 -re+d/ #hai Ming % *he /%erseas Assce #orpn Ltd $1<D2% 1 MLJ 2)2 -re+d/ #hampsey (hara - #o % Ji%ra0 (aloo &pinning and Wea%ing #o $1<23% 42 3)00 P2 -re+d/ "a%id M &app et al1 Appellants % Abraham (arenfeld et al1 'espondents 2&upreme #ourt of #alifornia31 33 2al 2d '1'0 S2 -re+d/ "a%id *aylor - &on Ltd % (arnett *rading #o $1<'3% 1 @LR 'D20 24 -re+d/ Edwards % (airstow $1<'D% 42 130 1L -re+d/ .anda Edible /ils &dn (hd % *ransgrain (4 $1<))% 1 MLJ 32)0 S2 -re+d/ .old - 'esource "e%elopment 2$53 Ltd % "ough 6ood Ltd $2000% 3 :FLR 31)0 24 -re+d/ .o%ernment of +ndia1 *he % #airn Energy +ndia ,ty Ltd - Anor $2011% D MLJ 3310 B2 -re+d/ 6artela #ontractors Ltd % 6artecon J4 &dn (hd - Anor $1<<<% 2 MLJ 3)10 24 -re+d/ +ntele7 *imur &dn (hd % 8uture 6eritage &dn (hd $2003% 1 MLJ 3010 B2 -re+d/ Maimunah "eraman % Ma0lis ,erbandaran 9emaman $2010% MLJG 1&11E $2011% < 2LJ D)<0 12 -re+d/ Ma0lis Amanah 'a7yat % 9ausar #orp &dn (hd $200<% MLJG 1D<&E $200<% 1 L:S 1&DD0 12 -re+d/ 3 MLJ 7 at 7 : $irwana #onstruction &dn (hd % ,engarah Jabatan 9er0a 'aya $egeri &embilan "arul 9husus Anor $200)% 3 MLJ 1'&0 24 -re+d/ ,embinaan L#L &dn (hd % &9 &tyrofoam 2M3 &dn (hd $200&% 3 MLJ 113E $200&% 3 2LJ 1)'0 24 -re+d/ ,er7ins 'estaurants /perating #o1 L, % 4an "en (ergh 8oods #o -1<<'/ 2&D 111 4pp 3d 30' -re+d/ ,ioneer &hipping Ltd and others % (*( *io;ide Ltd) *he $ema $1<)1% 2 4ll CR 10300 1L -re+d/ ,upu7e &er%ice &tation Ltd % #alte; /il 2$53 Ltd $2000% :FLR 33)0 P2 -re+d/ &hari7at ,emborong ,ertanian - ,erumahan % 8ederal Land "e%elopment Authority $1<&1% 2 MLJ 210 -re+d/ *aman (andar (aru Masai &dn (hd % "indings #orporations &dn (hd $200<% MLJG 0&<3E $2010% ' 2LJ )30 12 -re+d/ Le1isla+i/n re0erred +/ 4r(itration 4,t 200' s 32

Lye Wing 4oi 2<ap 6su-Lyn with him3 2Lye - <ap3 for the plaintiff= $oera>lin 2#atherine Licholas with her3 2Attorney .eneral Malaysia1 Attorney .eneral's #hambers3 for the defendant=

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M/hamad Ari00 "2 I#TRO UCTIO# 3)4 7he plainti++ applies to this ,ourt under s 32 o+ the 4r(itration 4,t 200' +or this ,ourt.s determination on se eral ;uestions o+ law arising out o+ an ar(itral award as spe,i+ied in 4nne8ure 4 to the originating summons6 ?n addition0 the plainti++ prays that the award dated 20 January 2012 (e set aside and/or aried to the e8tent the plainti++.s ,laim in the 4nne8ure B is allowed with interest and ,osts6 ?n the alternati e0 the plainti++ prays that the award together with the ,ourt.s determination on the ;uestions o+ law (e remitted to the ar(itral tri(unal to ;uanti+y the plainti++.s ,laims6 GO56R#I#G PRI#CIPL6S U# 6R S %$ O! TH6 ARBITRATIO# ACT $((7 3$4 ? ha e gi en due attention and +ull ,onsideration to the prin,iples go erning the e8er,ise o+ this ,ourt.s "urisdi,tion under s 32 o+ the 4,t as ela(orated in se eral re,ent ,ases a+ter the ,oming into +or,e o+ the 200' 4,t6 7he re;uirements under s 32 are stri,t and it is ne,essary +or the appli,ant to spe,i+y in ery ,lear terms the e8a,t ;uestions o+ law and that he re;uires the determination o+ the ,ourt6 384 7hese (asi, re;uirements under s 32 ha e (een satis+ied (y the plainti++ 3 MLJ 7 at 7 ? sin,e the ;uestions o+ law to (e determined ha e (een ,learly identi+ied and +ormulated0 and the grounds on whi,h the re+eren,e was sought also ade;uately stated6 By way o+ support0 the o(ser ations in *aman (andar (aru Masai &dn (hd % "indings #orporations &dn (hd $200<% MLJG &<3E $2010% ' 2LJ )3 are apt>
@hen relie+ under se,tion 32 is sought0 there is a duty and o(ligation to state the ;uestion o+ law arising +rom the award in a ,on,ise manner0 and state the grounds on whi,h the re+eren,e is soughtE in addition0 ? will say0 must state the +a,ts leading to the grounds0 +ailing whi,h the relie+ will not (e granted -per 1amid Sultan 4(u Ba,5er J at p 101 o+ the report/6

3%4 See also Maimunah "eraman % Ma0lis ,erbandaran 9emaman $2010% MLJG 1&11E $2011% < 2LJ D)<6 4s +ar as the ;uestions o+ law are ,on,erned0 they must also0 in the words o+ the statutory +ormula0 (e ;uestions .arising out o+ an award.6 Su,h a ;uestion o+ law ,annot simply (e said to arise out o+ the ar(itration generally0 (ut must arise .out o+ the award.6 7his distin,tion preser es the esta(lished law on .error o+ law on the +a,e o+ the award.0 and the parties in this a,tion are on ,ommon ground in this respe,t6 2ounsel +or the plainti++ has ,ited0 inter alia0 the ,ase o+ Ma0lis Amanah 'a7yat % 9ausar #orp &dn (hd $200<% MLJG 1D<&E $200<% 1 L:S 1&DD6 7hese general prin,iples were alluded to in that ,ase and ? ta5e the li(erty to reprodu,e the rele ant passages (elow>
666 it will (e unwise +or any Malaysian ,ourt to ,on,lude in +a our o+ an e8tended "urisdi,tion under s 32 o+ our 4r(itration 4,t 200'0 e en +or domesti, ar(itral awards0 as urged (y ,ounsel +or the plainti++6 7hat the ,ourts in Malaysia should ta5e a limited iew o+ its "urisdi,tion under s 32 also +inds support in the iews e8pressed (y the learned authors o+ Sundra Ra"oo H 9a idson0 *he Arbitration Act @AA -200&/ who are o+ the iew that a .stri,t approa,h. should (e applied (y Malaysian ,ourts0 and the +a,t that the Malaysian 4,t has omitted the lea e re;uirement ma5es it all the more ne,essary +or a stri,t approa,h to (e adopted6 See paras 32610#326110 p 201 o+ this ,ommentary>

.7he s,ope o+ the words .arising out o+ an award. in the Cnglish 1<&< 4,t was dis,ussed at length in the Cnglish 2ourt o+ 4ppeal ,ase o+ Bni%ersal ,etroleum #o % 6andels und *ransport .mb6 $1<)&% 1 @LR 11&)0 ,ounsel +or the appellant argued that a wide s,ope should (e gi en to these words 666 666 @hat needs to (e emphasised as pointed out !err LJ is that the ;uestion o+ law must arise out o+ the

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award itsel+ and not out o+ the ar(itration6 @hether or not the test is identi,al0 it ,ertainly does not di++er mu,h +rom the old test whi,h apply to .errors on the +a,e o+ the award.6 Viewed in this light0 there should (e no danger o+ .opening the +loodgates. to peripheral issues arising in the ,ase o+ the ar(itration (ut not on the award6 @e are o+ the iew that the stri,t approa,h adopted in Bni%ersal ,etroleum should (e applied to the Malaysian ,ourts sin,e the words o+ the statute o+ the same6 7he +a,t that the Malaysian 4,t has omitted lea e re;uirements ma5es it all the more ne,essary +or a stri,t approa,h to (e adopted6

3 MLJ 7

at 7!A

SCOP6 O! TH6 COURT9S "URIS ICTIO# O# 6RROR O! LA: ARISI#G OUT O! A:AR 374 7he s,ope o+ the ,ourt.s "urisdi,tion to set aside0 ary or remit an award on the (asis o+ error o+ law on the +a,e o+ the award is a narrow one6 7he distin,tion is drawn (etween an error o+ law in relation to a spe,i+i, ;uestion o+ law addressed to the ar(itral tri(unal +or its determination0 and a ;uestion o+ law whi,h arises during the ,ourse o+ the ar(itration pro,eedings6 ?n the ,ase o+ the +ormer0 the de,ision o+ the ar(itral tri(unal should (e regarded as +inal0 (ut in the ,ase o+ the latter the ,ourt ,an inter+ere0 and i+ ne,essary0 set aside the award on relati ely narrow grounds esta(lished through the ,ase authorities6 See #airn Energy +ndia ,ty Ltd - Anor % *he .o%ernment of +ndia $200<% D MLJ &<'E $2010% 2 2LJ 320 -2ourt o+ 4ppeal/6 3;4 7he Pri y 2oun,il in #hampsey (hara - #o % Ji%ra0 (aloo &pinning and Wea%ing #o $1<23% 42 3)0 e8plained this "urisdi,tion as +ollows>
4n error o+ law on the +a,e o+ the award means 666 that you ,an +ind in the award or a do,ument a,tually in,orporated thereto0 as +or instan,e a note appended (y the ar(itrator stating the reasons +or his "udgment0 some legal proposition whi,h is the (asis o+ the award and whi,h you ,an then say is erroneous -per Lord 9unedin/6

3'4 See also #hai Ming % *he /%erseas Assce #orpn Ltd $1<D2% MLJ 2)20 whi,h applies #hampsey (hara0 where the prin,iple is e8plained +urther thus> .666 the law is that in determining whether an award should (e remitted or set aside on the ground that there is an error o+ law appearing on the +a,e o+ it0 the ,ourt is not entitled to draw any in+eren,e as to the +inding (y the ar(itrator o+ +a,ts supporting the award0 (ut must ta5e the award at its +a,e alue.6 -per Su++ian J -as he then was/ at p 2)3/6 3<4 6alsbury's Laws of England states>
$w%here the ;uestion re+erred +or ar(itration is a ;uestion o+ ,onstru,tion0 whi,h is0 generally spea5ing0 a ;uestion o+ law0 the ar(itrator.s de,ision ,annot (e set aside only (e,ause the ,ourt would itsel+ ha e ,ome to a di++erent ,on,lusionE (ut i+ it appears on the +a,e o+ the award that the ar(itrator has pro,eeded illegally0 as0 +or instan,e0 (y de,iding on e iden,e whi,h was not admissi(le0 or on prin,iples o+ ,onstru,tion whi,h the law does not ,ountenan,e0 there is error in law whi,h may (e ground +or setting aside the award6

3=4 See eg +ntele7 *imur &dn (hd % 8uture 6eritage &dn (hd $2003% 1 MLJ 3010 where this passage was ,ited with appro al6 7he Bederal 2ourt o+ Malaysia in +ntele7 *imur also regarded as .well settled. law that an ar(itration award is +inal0 (inding and ,on,lusi e and ,an only (e ,hallenged in .e8,eptional ,ir,umstan,es.6 3 MLJ 7 at 7!C 3)(4 7he +ollowing passage +ound in the "udgment o+ Siti :orma B2J has (een ,ited in numerous de,isions>
7he law regarding the e++e,t o+ an ar(itration award is well settled in that the award is +inal0 (inding and ,on,lusi e and ,an only (e ,hallenged in e8,eptional ,ir,umstan,es6 4s su,h i+ an ar(itrator had erred (y drawing wrong in+eren,es o+ +a,t +rom the e iden,e (e+ore him (e it oral or do,umentary that in itsel+ is not su++i,ient +or the setting aside o+ his award6 .?t would (e ,ontrary to all the esta(lished legal prin,iples relating to ar(itration i+ an award (ased upon the e iden,e presented were lia(le to (e

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reopened on the suggestion that some o+ the e iden,e had (een .misapprehended and misunderstood.6

3))4 See also ,embinaan L#L &dn (hd % &9 &tyrofoam 2M3 &dn (hd $200&% 3 MLJ 1130 6artela #ontractors Ltd % 6artecon J4 &dn (hd Anor $1<<<% 2 MLJ 3)16 3)$4 &hari7at ,emborong ,ertanian - ,erumahan % 8ederal Land "e%elopment Authority $1<&1% 2 MLJ 2100 on a more general le el0 is an undou(ted authority a,,epted (y the ,ases in Malaysia0 on the issue o+ the e8tent to whi,h the 1igh 2ourt ,an inter+ere with the +indings o+ +a,t (y an ar(itral tri(unal>
666 this is not a re#hearing6 666 ? am not satis+ied that the ar(itrator had drawn wrong in+eren,es o+ +a,t +rom the e iden,e6 C en i+ he did0 that (y itsel+ is not su++i,ient as a ground to warrant setting aside the award6 ?t would (e ,ontrary to all esta(lished legal prin,iples relating to ar(itration i+ an award (ased upon the e iden,e presented were lia(le to (e reopened on the suggestion that some o+ the e iden,e had (een .misapprehended and misunderstood 666. -per Ra"a 4Alan Shah -as 1is Ma"esty then was/ at p 211/6

SUMMAR> O! TH6 PLAI#TI!!9S GROU# S I# CLAIM 3)84 7he grounds raised (y the plainti++ in this a,tion in re+eren,e to the alleged error o+ law on the +a,e o+ the award run as +ollows>

1a) 1b) 1c) 1d)

1e)

the ar(itrator has mis,onstrued the law and has ,ommitted a +undamental error o+ law whi,h was material to the de,ision he madeE the ar(itrator has +ailed to ,onstrue the rele ant ,lauses in the (uilding ,ontra,t in its entirety and has there(y depri ed the plainti++ o+ its ,laim +or loss and damageE the ar(itrator has +ailed to address and/or apply the appli,a(le legal pro isions in his award despite the pro isions (eing argued (e+ore him during the ar(itral pro,eedingsE there has (een a mis,arriage o+ "usti,e as the impugned +inding ie that the 3 MLJ 7 at 7!@ termination o+ the ,ontra,t was law+ul0 was +undamental to the reasoning or out,ome o+ the award whi,h was ,ontrary to law and/or pu(li, poli,yE and the ;uestions o+ law su(stantially a++e,t the rights o+ the plainti++6

BACKGROU#

!ACTS

3)%4 7he plainti++ was the appointed main ,ontra,tor +or a ,onstru,tion pro"e,t in ol ing the (uilding o+ a s,hool ,omple8 o+ three (lo,5s o+ a three#storey (uilding0 one (lo,5 ,omprising the ,anteen and ,onne,ted wor5s6 7he parties employed the Borm J!R 203 -Re ised 10/)3/ 2ontra,t6 7he Io ernment o+ Malaysia -Ja(atan !er"a Raya/ was the employer6 7he agreed ,ontra,t sum was RM301)D00)) with a ,ontra,t ,ompletion period o+ &2 wee5s ending 1) January 20016 7here were delays in the e8e,ution o+ the wor5s -a,,ording to the plainti++0 not wholly arising +rom ,auses attri(uta(le to the plainti++/6 7he plainti++ made two appli,ations +or e8tensions o+ time0 one dated 11 9e,em(er 2000 -C*7 :o 1/ +or e8tension o+ the ,ompletion date to 1' 4pril 20010 and the se,ond dated 1' Mar,h 2001 -C*7 :o 2/ +or e8tension o+ the ,ompletion date to 30 June 20016 3)74 *n 2& Be(ruary 20010 the de+endant purported to issue a noti,e o+ de+ault -.:*9./0 ie e en (e+ore a reply was re,ei ed +or C*7 :o 16 7his :*9 was re,ei ed (y the plainti++ on ' Mar,h 20016 7o ;uote this .:otis Gntu5 7u"uan Penamatan Pengam(ilan !er"a !ontra5tor.>
9u5a,ita dima5lum5an (ahawa tuan didapati tida5 men"alan5an 5er"a dengan (ersungguh#sungguh dan

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5er"a tuan di"ang5a tida5 a5an disiap5an pada 7ari5h Siap !er"a yang telah ditentu5an pada 1D Januari 20016 Berdasar5an 5epada Laporan S5ala Pengesahan Pro"e5 J!R !inta sehingga 31 Januari 20010 5er"a tuan sepatutnya sudah 100= siap tetapi 5ema"uan yang di,apai sehingga 5e tari5h 31 Januari 2001 adalah hanya &'=6

3);4 C*7 :o 1 was assessed0 and an e8tension o+ time o+ 30 days up to 1' Be(ruary 2001 was granted6 7his C*7 was granted (y ,erti+i,ate dated ' Mar,h 2001 whi,h was re,ei ed (y the plainti++ on 2& Mar,h 20016 C*7 :o 2 was not at all assessed6 3)'4 4 ,erti+i,ate o+ non#,ompletion -.2:2./ was issued dated D 4pril 20016 ?t was re,ei ed (y the plainti++ on 1& 4pril 20016 L49 was ,laimed6 3)<4 @hat +ollowed ne8t was a termination letter dated D 4pril 2001 whi,h was re,ei ed (y the plainti++ on 1& 4pril 20016 7he ground +or termination was 3 MLJ 7 at 7!3 purportedly (e,ause .didapati masih tida5 men"alan5an 5er"a dengan le(ih pesatnya.6 Re+eren,e was made to ,l '1 o+ the ,onditions o+ ,ontra,t6 3)=4 *n D 4pril 2001 the de+endant made an immediate demand on the per+orman,e (ond pro ided (y the plainti++ +or the sum o+ RM20<03030036 7he de+endant then suspended the plainti++.s li,en,e6 7here was no post#termination site inspe,tion or measurement o+ wor5s6 4,,ording to the plainti++0 it su(se;uently su(mitted its progress ,laims 12#)00 +or an alleged per,entage o+ ,ompletion o+ <2=6 7his was on 12 4pril 20016 3$(4 7he plainti++ disputed the noti,e o+ termination on 1) 4pril 20016 4 repla,ement ,ontra,tor was appointed and a unilateral +inal a,,ount +or the sum o+ RMDD30<)D632 was purportedly issued6 7his was protested to0 and the sum was su(se;uently re ised to RM3<00D)16D06 4 +urther dedu,tion was made +or the sum o+ RM1&303236)2 whi,h was a sum allegedly owing (y the plainti++ to the de+endant under another separate ,ontra,t6 TH6 SI? ISSU6S B6!OR6 TH6 ARBITRATOR 3$)4 4t the ar(itration0 the learned ar(itrator addressed si8 prin,ipal issues>
?ssue 1 @hether the 2laimant is entitled to +urther e8tension o+ time and that time +or ,ompletion is set .at large.6 ?ssue 2 @hether the issuan,e o+ the 2erti+i,ate o+ :on#2ompletion -2:2/ +or the @or5s (y the Respondent is wrong+ul and in alid and that the su(se;uent imposition o+ li;uidated as,ertained damages -L49/ is there+ore0 in alid6 ?ssue 3 @hether the Respondent.s determination o+ the 2laimant.s 2ontra,tor.s Cmployment under the 2ontra,t -7ermination o+ 2ontra,t/ is law+ul and alid6 ?ssue 3 @hether the 2laimant is entitled to see5 re,o ery o+ the per+orman,e (ond +or whi,h the Respondent demanded and en,ashed in the sum o+ RM20<03036306 ?ssue ' ?+ ?ssue :o 3 is non#a++irmati e0 whether the 2laimant is entitled to loss and damages0 in the aggregate sum o+ RM3'0&)'023<6326 ?ssue D ?+ ?ssue :o 3 is a++irmati e0 whether the Respondent is entitled to re,o er ,osts in the sum o+ RMDD30<)D632 arising +rom the Binal 4,,ounts prepared (y the Respondent in a,,ordan,e with J!R.s 2ir,ular :o 3/1<<06

Page <

3 MLJ 7 TH6 ARBITRATOR9S !I# I#GS

at 7!D

3$$4 7he +irst two issues were de,ided in the plainti++.s +a our as the ,laimant6 @ith respe,t to issue :o 10 the learned ar(itrator.s analysis o+ the +a,ts and his +indings on the main and su(# issues ,an (e +ound at paras &1#1&3 o+ the +inal award6 1e e entually held that the ,laimant was entitled to an aggregate C*7 o+ &D days0 whi,h e8tended the original date o+ ,ompletion +rom 1D January 2001#2 4pril 20016 ?n para 1&3 the learned ar(itrator held>
*n the (asis o+ e iden,e0 ? +ind +or the ,laimant and +urther hold that the time +or ,ompletion o+ the wor5s is set .at large. and that the ,laimant ,ontra,tor is o(ligated to ,omplete the remaining wor5s within a reasona(le time6.

3$84 4s regards issue :o 20 the learned ar(itrator held ery ,learly at para 1<1>
4s a general prin,iple o+ law the issuan,e o+ a alid 2:2 is a ,ondition pre,edent to the operation and imposition o+ li;uidated as,ertained damages -L49/6 Ii en my +inding that the issuan,e 2:2 was improper0 wrong+ul and in alid0 ? +urther hold that the imposition o+ L49 on the ,laimant ,ontra,tor0 is there+ore unlaw+ul in the ,ir,umstan,es6

3$%4 4t para 1)' he re+erred to the 2ourt o+ 4ppeal de,ision in ,embinaan L#L &dn (hd % &9 &tyrofoam 2M3 &dn (hd $200&% 3 MLJ 113E $200&% 3 2LJ 1)' +or the proposition that a ,erti+i,ate o+ non#,ompletion -2:2/ would (e in alid i+ an ar,hite,t had not properly assessed the ,ontra,tor.s re;uest +or e8tension o+ time so that the ar,hite,t ,ould not 5now there+ore the pre,ise ,ompletion time sin,e time would no longer (e the essen,e o+ the ,ontra,t in the ,ir,umstan,es6 4t paras 1))#1)<0 he e8pressed the iew that gi en his earlier +inding o+ the ,laimant that the time the ,ompletion o+ the wor5s or set .at large.0 the issuan,e o+ the ,erti+i,ate o+ non#,ompletion -2:2/ (y the respondent was there+ore wrong+ul and in alid in the ,ir,umstan,es6 TH6 PLAI#TI!!9S ARGUM6#TS 3$74 7he plainti++ is in total agreement with these +indings in relation to issue :o 1 and issue :o 20 (ut disputes the ar(itrator.s +inding on issue :o 30 (asi,ally on the ground that it ,ontradi,ts his earlier +indings0 is illogi,al0 not ,onsonant with the law on .time (eing at large0 and is otherwise a +inding that no reasona(le ar(itrator would ha e rea,hed6 ?n para 23) o+ the +inal award0 the learned ar(itrator ,on,luded>
*n the (asis o+ e iden,e0 ? +ind +or the respondent and there+ore hold that the respondent.s determination o+ ,laimant ,ontra,tor.s employment under the ,ontra,ts -termination o+ ,ontra,t/ is law+ul and alid6

3 MLJ 7

at 7!

3$;4 Lat,hing on this +inding on issue :o 30 the plainti++ has argued strongly that there has (een a ,lear or mani+est error o+ law on the +a,e o+ the war -arising out o+ the award/ sin,e ar(itrator had +ailed to address and apply the rele ant legal pro isions in his award despite these pro isions (eing argued (e+ore him during the ar(itral pro,eedings6 2ounsel re+ers in parti,ular to the alleged +ailure to appraise the e++e,t0 or the +ailure o+ the ar(itrator to apply his mind0 to the +indings o+ the 2ourt o+ 4ppeal in $irwana #onstruction &dn (hd % ,engarah Jabatan 9er0a 'aya $egeri &embilan "arul 9husus - Anor $200)% 3 MLJ 1'& and ,embinaan L#L &dn (hd % &9 &tyrofoam 2M3 &dn (hd $200&% 3 MLJ 113E $200&% 3 2LJ 1)'6 7he in,onsistent and illogi,al out,ome is argued as +ollows6 7he learned ar(itrator had earlier held that the ,ontra,t time was .at

Page 10 large. and there+ore the plainti++ had a reasona(le time to ,omplete the wor5s su,h that the ,ontra,t time was no longer o+ the essen,e0 and yet he upheld the noti,e o+ termination whi,h was (ased essentially on a timeline whi,h was no longer operati e6 7he termination o+ the ,ontra,t on D 4pril 2001 was tra,ea(le to the :*9 issued earlier on 2& Be(ruary 2001 whi,h e8pressly re+erred to the earlier ,ontra,t ,ompletion date6 4,,ording to ,ounsel0 in ,embinaan L#L it was said>
?t is ,rystal ,lear that the respondent had a,ted in (rea,h o+ ,ontra,t (y issuing the termination noti,e (ased on a time +rame that was no longer operati e 666 -per Iopal Sri Ram J24 at para 230 p 20) o+ the report/6

3$'4 7his0 it was argued0 was the position on the +a,ts o+ this a,tion6 7he learned ar(itrator0 in +inding the determination noti,e alid0 had relied on a ,ontra,t ,ompletion date whi,h was no longer operati e sin,e (y his own earlier +inding time had (een .set at large.6 3$<4 4s +or the +ailure to apply his mind ,orre,tly to the de,ision in $irwana #onstruction0 the +ollowing passages o+ the 2ourt o+ 4ppeal in that ,ase are emphasised>
7here appears to (e non#,omplian,e with the re;uirement o+ ,l '10 in that the noti,e did not ,ontain the pre,ise ground o+ termination6 7hus0 in itsel+ the noti,e was (ad 666 -per Fainun 4li J24 at p 1&D o+ the report/6

3$=4 ?+ ? understand the su(mission (y the plainti++.s ,ounsel ,orre,tly0 the point (eing made here is that the $irwana #onstruction de,ision re;uires the e8a,t words in ,l '1 to (e used in the noti,e o+ termination6 ?+ the e8a,t words are not use0 the noti,e in itsel+ is (ad6 7his is how the su(mission is ad an,ed in the written su(mission0 whi,h ? ;uote (elow>
3 MLJ 7 at 7!! 3&6 ?n the ,ase o+ :irwana ,onstru,tion Sdn Bhd0 it was held that the words .9u5a,ita diperhati5an (ahawa tuan didapati masih tida5 men"alan5an 5er"a#5er"a dengan le(ih pesatnya 666. -same words used in the noti,e o+ termination in the present ,ase/ were not a,,epted as a pre,ise ground termination re;uired under ,lause '1 o+ the ,onditions o+ ,ontra,t6 3)6 ?t is +urther pertinent to (ring to the attention o+ this honoura(le ,ourt that the ,ontents o+ the noti,e o+ termination in :irwana 2onstru,tion was su(stantially in the same manner and +orm as that in this ,ase6 ?t was held there (y the ,ourt o+ appeal that the noti,e was null and oid and o+ no e++e,t as it +ailed to ,omply with ,lause '1 o+ the ,ontra,t -as in this ,ase/6

IRRATIO#ALIT>@ILLOGICALIT> ARGUM6#T 38(4 7o support his argument that the ,ourt ,an set aside0 remit or ary an award on the (asis o+ illogi,ality0 strong relian,e was pla,ed on Edwards % (airstow $1<'D% 42 130 a leading Cnglish de,ision in relation to an appeal (y way o+ ,ase stated0 where Lord Rad,li++e had elo;uently stated>
@hen the ,ase ,omes (e+ore the ,ourt it is its duty to e8amine the determination ha ing regard to its 5nowledge o+ the rele ant law6 ?+ the ,ase ,ontains anything e8 +a,ie whi,h is (ad law and whi,h (ears upon the determination0 it is0 o( iously0 erroneous in point o+ law6 But without any su,h mis,on,eption appearing e8 +a,ie0 it may (e that the +a,ts +ound are su,h that no person a,ting "udi,ially and properly instru,ted as to the rele ant law ,ould ha e ,ome to the determination and the appeal6 ?n those ,ir,umstan,es0 too0 the ,ourt must inter ene 666

38)4 7he ,ourt.s attention was drawn to the 1ouse o+ Lords ,ases in .7he :ema. - ,ioneer &hipping Ltd and others % (*( *io;ide Ltd) *he $ema $1<)1% 2 4ll CR 1030/ and .7he 4ntaios. -Antaios #ia $a%iera &A % &alen 'ederierna A() *he Antaios $1<)3% 3 4ll CR 22<0 where Edwards % (airstow was ,ited with appro al6

Page 11 38$4 7he e8tent to whi,h the prin,iples in Edwards % (airstow ,an apply in ar(itration law is a matter o+ some dispute6 ?n Ma0lis Amanah 'a7yat % 9ausar #orp &dn (hd -whi,h was re+erred (y ,ounsel +or the plainti++ in su(mission/ ? ha e dis,ussed the rami+i,ations whi,h ,an result +rom a wholesale adoption o+ the Edwards prin,iples in ar(itration matters0 and ? do not propose to repeat them here6 3884 Senior +ederal ,ounsel +or the de+endant has in turn re+erred to an 4meri,an de,ision in ,er7ins 'estaurants /perating #o1 L, % 4an "en (ergh 8oods #o -1<<'/ 2&D 111 4pp 3d 30'0 and the passage reading>
666 4n illogi,al or in,onsistent de,ision on the part o+ the ar(itrator is not a su++i,ient (asis upon whi,h to o erturn an ar(itration award6

3 MLJ 7

at 7!7

38%4 ?n this regard0 senior +ederal ,ounsel has e en gone to the e8tent o+ arguing that an ar(itral tri(unal ,annot (e regarded as (eing stri,tly (ound (y "udi,ial pre,edent0 again ,iting se eral 4meri,an authorities in support6 7his argument is ta5en in re+eren,e to the plainti++.s ,ounsel relian,e on $irwana #onstruction and ,embinaan L#L6 See also "a%id M &app et al1 Appellants % Abraham (arenfeld et al1 'espondents 2&upreme #ourt of #alifornia31 33 2al 2d '1' > 4r(itrators0 unless spe,i+i,ally re;uired to a,t in ,on+ormity with rules o+ law0 may (ase their de,ision upon (road prin,iples o+ "usti,e and e;uity0 and in doing so may e8pressly or impliedly re"e,t a ,laim that a party might su,,ess+ully ha e asserted in a "udi,ial a,tion 666. -at para 12 o+ the "udgment/.6 ILL6GALIT> PRI#CIPL6 3874 4s +or Edwards % (airstow0 ? would enture to suggest that .the "ury is still out. on the issue o+ its appli,a(ility in ar(itration law0 (ut it will (e di++i,ult in a ,lear ,ase +or any ,ourt to ignore a patently ,lear instan,e o+ an illogi,al award0 howe er mu,h one would li5e to de+er to the prin,iple o+ party autonomy in the sele,tion o+ their own +orum o+ ,hoi,e6 4t least in the instan,e where an issue o+ ,onstru,tion o+ the law is re+erred to an ar(itrator to de,ide0 our Bederal 2ourt has re,ently rea++irmed the position o+ non#inter+eren,e in *he .o%ernment of +ndia % #airn Energy +ndia ,ty Ltd - Anor $2011% D MLJ 331 >
@e note that the ar(itrators were +a,ed with a ;uestion on the ,onstru,tion o+ the ,lause in an agreement6 Brom the reading o+ it0 no dou(t it ,ould (e gi en to interpretations ## one in +a our o+ the appellant and one in +a our o+ the respondents6 Bor that ery reason0 the matter was sent +or ar(itration6 7he +a,t that the learned ma"ority ar(itrators to one approa,h interpretation -whi,h was in +a our o+ the respondents/ o er the other ,annot (e ground +or ,hallenge6 4nd S,rutton LJ put it .666 ?+ you re+er a matter e8pressly to the ar(itrator and he ma5es an error o+ law you must ta5e the ,onse;uen,esE you ha e gone to an ar(itrator and i+ the ar(itrator whom he ,hose ma5es a mista5e and law that is you loo5 out +or ,hoosing the wrong ar(itratorE i+ you ,hoose to go to 2aesar you must ta5e 2aesar.s "udgment -see African - Eastern 2Malaya3 Ltd % White1 ,almer - #o Ltd 2C?3A3 666 ,ited with appro al (y the 2ourt o+ 4ppeal in "ato' *iong *ec7 9im - others % "ato' *iong *ec7 Leng $1<<D% 1 MLJ 1&) 666. -per Ri,hard Malan"um 2J -Sa(ah and Sarawa5/ at p 3D2 o+ the report/6

38;4 But the Bederal 2ourt in this ,ase has also ,omprehensi ely re+erred to the leading ,ases in Malaysia su,h as &hari7at ,emborong ,ertanian1 .anda Edible /ilsand +ntele7 *imur0 and rationalised the prin,iples6 7o inter+ere0 an award .must (e tainted with some sort o+ illegality.6 ? ;uote the pertinent passages>
7he ne8t point re;uiring to (e ,onsidered is> 3 MLJ 7 at 7!: -a/ whether the ,ases o+ .anda Edibile and +ntele7 *imur introdu,ed a ground +or ,hallenge in ,ases where a spe,i+i, re+eren,e was made +or ar(itration0 namely0 that an a,t o+ illegality has (een ,ommitted (y the ar(itrator0 su,h as de,iding on e iden,e whi,h was not admissi(le0 or on prin,iples o+ ,onstru,tion

Page 12
whi,h the law does not ,ountenan,eE and -(/ whether the ;uestion o+ ,onstru,tion o+ a ,ontra,t is a ;uestion o+ law0 whi,h i+ spe,i+i,ally re+erred to ar(itration0 ought to +all within the am(it o+ the a(o e distin,tion as laid down in 9ing % "u%een6 666 @ith re+eren,e to item -a/0 in .anda Edible /ils0 Bara5(ah S2J stated the +ollowing>

?+ a spe,i+i, ;uestion o+ law is su(mitted to the ar(itrator +or his de,ision and he de,ides it0 the +a,t that the de,ision is erroneous does not ma5e the award (ad on its +a,e so as to permit its (eing set asideE and where the ;uestion re+erred +or ar(itration is a ;uestion o+ ,onstru,tion0 whi,h is0 generally spea5ing0 a ;uestion o+ law0 the ar(itrator.s de,ision ,annot (e set aside only (e,ause the ,ourt would itsel+ ha e ,ome to a di++erent ,on,lusionE (ut i+ it appears on the +a,e o+ the award that the ar(itrator has pro,eeded illegally0 as0 +or instan,e0 (y de,iding on e iden,e whi,h was not admissi(le0 or on prin,iples o+ ,onstru,tion whi,h the law does not ,ountenan,e0 there is error in law whi,h may (e ground +or setting aside the award6

4 su(stantial portion o+ these words were reprodu,ed (y this ,ourt in +ntele7 *imur6 1owe er0 it must (e pointed out that (oth ,ases e8pressly endorsed &hari7at ,emborong6 +n our %iew the &upreme #ourt in .anda Edible /ils and the 8ederal #ourt +ntele7 *imur did not introduce any new ground for challenge= (oth cases merely reiterated a fundamental principle of law1 to wit1 that if a decision of an arbitrator is tainted with illegality1 it is always open for challenge= *hus1 e%en where a specific reference has been made to the arbitrator1 if the award subseguentl% made is tainted with illegality1 it can be set aside by the courts on the ground that an error of law had been committed= +t must be stressed here that the award must be tainted with some sort of illegality= +t must also be emphasised that the word 'may' is used here1 in that the award may be set aside= "iscretion still lies with the court as to whether to respect the award of the arbitral tribunal or to re%erse it -at p 3'& o+ the report/6

38'4 ? add the ne,essary emphasis a(o e6 Li5ewise0 on the +a,ts o+ the present ,ase it will (e o+ importan,e to esta(lish whether the award has (een tainted with .any sort o+ illegality.0 re,ognising that the ,ourt has the dis,retion to e8er,ise its "urisdi,tion whether to set aside0 ary0 remit or respe,t the de,ision o+ the learned ar(itrator6 TH6 COURT9S !I# I#GS 38<4 4t the le el o+ preliminary ,onsideration0 ? must admit the su(missions marshalled (y the plainti++.s ,ounsel ha e a ,on in,ing air to it0 (ut "udi,ial 3 MLJ 7 at 7!? dis,retion re;uires the award to (e e8plored more properly and ,omprehensi ely0 and assessed in a,,ordan,e with the settled prin,iples ? ha e earlier analysed at the outset o+ this "udgment6 @hat appears as an illogi,al ,on,lusion may upon this plat+orm o+ analysis lead to di++erent assessment when iewed +rom the perspe,ti e o+ the +indings o+ +a,t and appli,ation o+ the law6 38=4 Gpon reading the +inal award as a whole0 ? +ind the learned ar(itrator has de oted an in#depth analysis o+ issue :o 30 +rom paras 1<2#23)0 (e+ore +inally ,on,luding0 as stated earlier . /n the e%idence0 ? +ind +or the Respondent and there+ore hold that the Respondent.s 9etermination o+ 2laimant 2ontra,tor.s Cmployment under the 2ontra,t -7ermination o+ 2ontra,t/ is law+ul and alid.6 3%(4 ?t is o+ the utmost importan,e to stress that the +indings o+ the learned ar(itrator was rea,hed upon a +ull ,onsideration o+ the e iden,e in support o+ the (rea,h o+ ,l '1-a/-ii/0 reading in its material parts -in Bahasa Melayu/>
'1-a/ 7anpa men"e"as apa#apa ha5 atau remedi lain yang dipunyai oleh !era"aan0 "i5a !ontra5tor mela5u5an 5emung5iran mengenai mana#mana satu atau le(ih daripada per5ara#per5ara yang (eri5ut0 iaitu> 666

Page 13
-ii/ 0i7a ia papal menerus7an 9er0a dengan mengi7ut aturan dan te7unnya === ma5a P6P6 (oleh mem(eri 5epadanya suatu notis yang dihantar dengan pos (erda+tar atau dengan serah#hantaran menyata5an 5emung5iran itu0 dan "i5a !ontra5tor samada menerus5an 5emung5iran itu selama empat (elas -13/ hari selepas penerimaan notis itu atau pada (ila#(ila masa selepas itu mengulangi 5emung5iran itu -samada pernah diulangi dahulu atau tida5/0 ma5a !era"aan (oleh dengan demi5ian itu melalui suatu notis yang dihantar dengan pos (erda+tar atau dengan serah#hantaran yang dire5od5an menamat5an pengam(ilan 5er"a !ontra5tor di(awah !ontra5 ini6

3%)4 ? +ind the learned ar(itrator had ,onsidered the e iden,e in relation to the +ailure to .pro,eed regularly and diligently with the @or5s. +rom paras 1<2#2&D0 and ,ame to +irm +indings o+ +a,t on the e iden,e that the :*9 and the su(se;uent termination was not mala +ide0 un,ons,iona(le or wrong+ul6 1e also +irmly ,on,luded> ? there+ore +ind the ,laimant.s argument that .the 2:2 itsel+ would ha e superseded the e ent ,omplained o+ in the :oti,e o+ 9e+ault. untena(le as they are (oth di++erent and unrelated pro isions in the 2ontra,t -para 222/6 3%$4 See also other important +indings o+ +a,t in para 211>
3 MLJ 7 at 77A Brom the a(o e trail o+ letters0 ser ing as warning and reminder letters to the 2laimant 2ontra,tor on the la,5 o+ progress and unsatis+a,tory wor5s on site0 ? B?:90 on the (alan,e o+ pro(a(ilities +or the Respondent and +urther 1*L9 that the :oti,e o+ 9e+ault -:oti,e o+ 9etermination o+ 2ontra,tor.s Cmployment/0 as in 226D30 was not e8atious nor unreasona(le (ut properly issued in the ,ir,umstan,es6

3%84 4s +or the alleged +ailure not to ha e ,onsidered or applied his mind to $irwana #onstruction0 the short point is0 he did6 See paras 232#23&6 4t para 23&0 the learned ar(itrator ,on,luded>
? disagree with the ,laimant.s su(mission and ? B?:9 the reason stated in para 2 o+ 226'' +alls within the am(it o+ ,l '1-a/-ii/ o+ the ,ontra,t on ground o+ .+ailure to pro,eed regularly and diligently with the @or5s.6 ?n addition0 the respondent has right to terminate the ,ontra,t under ,ommon law i+ the progress o+ wor5s is unsatis+a,torily slow with inade;uate resour,es and wor5ers on site6

3%%4 Juite apart +rom the e8press re+eren,e to the ,ase in the +inal award0 ? ha e also ,onsidered and e aluated the prin,iple su(mitted to (e the prin,iple esta(lished (y this 2ourt o+ 4ppeal de,ision0 as argued (y the plainti++.s ,ounsel0 ie0 as earlier ;uoted>
7here appears to (e non#,omplian,e with the re;uirement o+ ,lause '10 in that the noti,e did not ,ontain the pre,ise ground o+ termination6 7hus0 in itsel+ the noti,e was (ad 666

3%74 @ith all due respe,t0 a+ter perusing the entirety o+ the "udgment0 the passage ;uoted (y ,ounsel is no authority to support a prin,iple o+ sla ish adheren,e to the e8a,t wording o+ ,l '16 Mu,h turns on the pre,ise +a,ts and on the su(stan,e o+ the rele ant termination letter6 7he ,orresponden,e in $irwana #onstruction did not show on what pre,ise ground the termination was made6 7his is not the ,ase on the present +a,ts here6 3%;4 7here is there+ore no pressing need to ,onsider whether an ar(itrator ,an disregard "udi,ial pre,edent0 sin,e he is not part o+ the "udi,ial institution6 ? would howe er enture to suggest that i+ he (e so (old as to ignore ,lear ,ase authority0 this would (e a ,lassi, ,ase o+ interpreting the law on prin,iples not ,ountenan,ed (y the law0 whi,h in any e ent is an a,,epted and esta(lished +a,et o+ error o+ law on the +a,e o+ the award6 3%'4 Seen in its entirety0 ? do not +ind the +indings in the +inal award illogi,al or in,onsistent6 7he learned ar(itrator has ,ome to de+inite +indings on the e iden,e and has +ound the issues o+ 2:2 and C*7 to (e separate +rom the issue o+ +ailure to pro,eed regularly and diligently with the wor5s whi,h 3 MLJ 7 at 77C

Page 13 a++orded a ,ause +or termination under ,l '1 o+ the ,ontra,t6 7here ,annot (e said to (e any illegality or irrationality in the Edwards % (airstow sense0 e en on the assumption it applies6 ?t ,annot (e plausi(le ,on,luded that on the present +a,ts no reasona(le ar(itrator would ha e rea,hed the same ,on,lusions6 @hile one ,an a,,ept the prin,iple that .there ,annot (e one law +or ar(itrators and another +or the ,ourt.0 and .there is one law +or all.0 su,h that i+ a ,ontra,t is illegal .then ar(itrators must de,line to award upon it "ust as the ,ourt would do. -per Lord 9enning LJ0 as he then was0 in "a%id *aylor - &on Ltd % (arnett *rading #o $1<'3% 1 @LR 'D2/0 it is e;ually important to realise the limits o+ the ,ourt.s "urisdi,tion in these matters0 whi,h is limited to the ,orre,tion o+ .ar(itral. not .appellate. errors6 3%<4 ?n this ,onne,tion0 the pronoun,ements o+ the "udi,ial ,ommittee in ,upu7e &er%ice &tation Ltd % #alte; /il 2$53 Ltd $2000% :FLR 33) -in,luded as an appendi8 in the .old - 'esource "e%elopment 2$53 Ltd % "ough 6ood Ltd $2000% 3 :FLR 31) ,ase0 whi,h ? ,ited earlier in Ma0lis Amanah 'a7yat % 9ausar #orp &dn (hd/0 deser e to (e re#;uoted>
4r(itration is a ,ontra,tual method o+ resol ing disputes6 By their ,ontra,t parties agreed to entrust the di++eren,es (etween them to the de,ision o+ an ar(itrator or panel o+ ar(itrators0 to the e8,lusion o+ the ,ourts0 and they (ind themsel es to a,,ept that de,ision0 on,e made0 whether or not they thin5 it right6 ?n prospe,t0 this method o+ten seems attra,ti e6 ?n retrospe,t0 this is not always so6 1a ing agreed at the outset to ta5e his disputes away +rom the ,ourt the losing party may a+terwards (e tempted to thin5 (etter o+ it0 and as5 the ,ourt to inter+ere (e,ause the ar(itrator has misunderstood the issues0 (elie ed un,on in,ing witness0 de,ided against the weight o+ e iden,e0 or otherwise arri ed at a wrong ,on,lusion6 4ll de elop systems o+ ar(itration law ha e in prin,iple set their +a,e against a,,ommodating su,h a ,hange o+ mind6 7he parties ha e made the ,hoi,e0 and must a(ide (y it6 7his general prin,iple is0 howe er0 applied in di++erent ways under di++erent systems0 a,,ording to the nature o+ the ,omplaint6

3%=4 So it should (e in the total ,ir,umstan,es o+ the present ,ase0 +or there is no error o+ law on the +a,e o+ the award0 or arising out o+ the award0 esta(lished6 CO#CLUSIO# 37(4 By way o+ ,on,lusion there+ore0 the ;uestions to (e determined as listed in 4ppendi8 4 are answered in the negati e in respe,t o+ Juestions 1#36 7here are no errors o+ law arising out o+ the +inal award6 Juestion '0 (eing dependent on an a++irmati e answer to ;uestions 1#30 (e,omes irrele ant6 4s +or Juestion D0 and ,onse;uent to the negati e answers to Juestions 1#30 the answer to Juestion D is also in the negati eE there is no error o+ law arising out o+ the award sin,e the matters spe,i+ied in Juestion D tou,h and ,on,ern in+eren,es +rom the e iden,e and are not .ar(itral errors.6 3 MLJ 7 at 77@ 37)4 7he plainti++.s ,laim0 as parti,ularised in 4ppendi8 B0 is hen,e dismissed with +i8ed ,osts RM100000 to (e paid (y the plainti++ to the de+endant6 #laim dismissed with costs=

Reported (y 4sho5 !umar

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