MS Elevators Engineering Sdn Bhd v Fairview International School Nusajaya Sdn Bhd

Appellant(s): Xxxx

Respondent(s): Fairview International School Nusajaya Sdn Bhd

• YA Datuk Supang Lian
• YA Dato' Azmi Bin Ariffin
• YA Datuk Ismail Bin Brahim

• The plaintiff, an international school, engaged the defendant to supply, install, test, commission, and maintain three lifts for its new campus, under a Letter of Award (LOA) specifying a six-month completion period and daily liquidated ascertained damages (LAD).
• The defendant failed to complete the works by the agreed deadline of 28 February 2015, and although JKKP certificates were issued on 2 June 2015, the lifts remained defective and unsafe for use.
• The plaintiff subsequently engaged third-party contractors to rectify the defects and sought damages for delay, rectification costs, and nominal damages for loss of student intake, while the defendant counterclaimed for unpaid works.

• Whether the defendant breached the contract by failing to complete the lift works by the stipulated date and deliver lifts fit for purpose, thereby entitling the plaintiff to LAD.
• Whether the plaintiff was justified in engaging third-party contractors for rectification works and claiming the associated costs, and if the defendant was entitled to suspend works for non-payment.
• Whether the LAD amount should be capped at 5% of the contract sum as per general conditions or at the daily rate specified in the LOA, and if the defendant's counterclaim for unpaid works was valid.

• The Court affirmed the High Court's decision, holding that the defendant breached the contract by failing to complete the works by the deadline and deliver safe, functional lifts, thus entitling the plaintiff to LAD.
• The Court found that the defendant was not entitled to suspend works for non-payment as there was no contractual provision allowing it, and the plaintiff was justified in engaging third parties for rectification given the defendant's refusal to remedy defects.
• The Court ruled that the LAD clause in the LOA, specifying a daily rate, took precedence over any general conditions, and dismissed the defendant's counterclaim for unpaid works due to non-completion as per contract and lack of valid certification.