VKPT Sdn Bhd v LLC Infra Sdn Bhd

Appellant(s): Vkpt Sdn Bhd

Respondent(s): Llc Infra Sdn Bhd

• YA Datuk Seri Mohd Firuz Bin Jaffril
• YA Dato' Ong Chee Kwan
• YA Tuan Dean Wayne Daly

• The appellant, a main contractor, engaged the respondent as sub-subcontractor for LRT3 trackwork; after the respondent terminated the sub-subcontract citing default, the appellant commenced CIPAA adjudication, which was dismissed in full with adjudication costs of RM98,300 awarded against the appellant, which it did not challenge by way of set-aside application and did not pay.
• The respondent separately obtained a costs order against the appellant in judicial management proceedings, and combined both unpaid cost sums to serve a statutory demand under s.466(1)(a) of the Companies Act 2016, followed by a winding-up petition after the demand went unsatisfied.
• The appellant resisted the petition, asserting an intention to litigate the underlying construction dispute, and eventually filed a High Court suit for final determination of the dispute shortly before the petition hearing; the High Court nonetheless granted the winding-up order, prompting this appeal.

• Whether an adjudication decision under CIPAA becomes an "indisputable" debt for winding-up purposes immediately upon delivery, or only upon registration as a judgment under s.28 of CIPAA.
• Whether a costs order made by an adjudicator upon dismissal of a claim (as opposed to a costs order following withdrawal of adjudication proceedings) constitutes an "adjudication decision" within s.13 of CIPAA, attracting the full statutory regime of set-aside, stay, registration and extinguishment.
• What test governs whether a company facing a winding-up petition founded on an unregistered adjudication decision has raised a genuine dispute on substantial grounds, and how the pendency of court proceedings for final determination of the underlying dispute bears on that test.

• The Court held that registration under s.28 of CIPAA is not a precondition to presenting a winding-up petition, but it is the "legal watershed" that converts a merely persuasive, temporarily-final adjudicated debt into an indisputable judgment debt; absent registration, the debtor may resist the petition by showing a genuine dispute on substantial grounds, applying the Sian Participation/V Medical Services standard rather than treating the adjudicated sum as automatically indisputable, thereby confining Bludream to cases involving registered decisions.
• The Court found that a costs order made by an adjudicator after determining and dismissing a claim on its merits (unlike a bare procedural costs order following withdrawal, as in Multazam) is an integral part of the adjudication decision itself, subject to set-aside, stay, registration, and automatic extinguishment under s.13(c) upon final determination of the underlying dispute by a court or arbitral tribunal.
• The Court held that the appellant's filing of a suit for final determination of the underlying construction dispute constituted a genuine and substantial challenge to the unregistered adjudication costs debt, and that the respondent had not shown this suit to be a mala fide device to stifle the petition; the winding-up order was accordingly set aside and the appeal allowed with costs of RM30,000.