MALAYSIAN SOCIETYOF ADJUDICATORS

NEwSLETTER . vOLUME ONE . ISSUE NO 2 JULY - DECEMbER 2014

Published by

THE MALAYSIAN SOCIETY OF ADJUDICATORS

Kuala Lumpur Regional Centre for ArbitrationBangunan SulaimanJalan Sultan Hishamuddin50000 Kuala Lumpur, Malaysia

Tel: +603.2271.1000 Fax: +603.2271.1010

This Newsletter is periodically published for distribution to its members and to those who are interested in the adjudication of disputes under the Construction Industry Payment & Adjudication Act of 2012 (CIPAA 2012). The logo of the MSA symbolizes the functions and constraints of adjudication: three arches represent a simpler, cheaper, and faster summary passage through the payment dispute resolution process via adjudication; grey signifies the integrity, independence, and impartiality of the adjudicator; and blue stands for the adjudicators fair-minded, open, and even approach towards the parties, mindful of justice, perseverance, and vigilance.

The Newsletter is intended to serve as the leading forum for the thoughtful review, analysis, and improvement of adjudication under CIPAA 2012. Accordingly, submissions of articles and information are invited. The views presented in the Newsletter are those of the individual authors, and do not necessarily represent the views of the MSA, which takes no responsibility for any statement or opinion in this Newsletter. That being said, the MSA makes no representation, express or implied, that the contents are accurate, complete, or correct, and similarly disclaims all liability whatsoever for the content in the Newsletter. Submissions may be made by email to enquiries@klrca.org

Permit Number: PP18529/07/2014 (033945)

CONTENTS

MALAYSIAN SOCIETYOF ADJUDICATORS

i

PRESIDENTS PAGE

ADJUDICATORS CORNER

IN FOCUS

SIDEBAR

HAPPENINGS

EDITORS DESK

ADJUDICATORS CORNER

IN FOCUS

SIDEBAR

HAPPENINGS

PODIUM

ADJUDICATORS CORNER

HAPPENINGS

IN FOCUS

DECISION NOTES

HAPPENINGS

1

36

9

52

63

2

40

14

56

64

4

49

61

26

60

65

The Presidents Message

Aligning with CIPAA 2012!

Five Questions - Four Respondents Chang Wei Mun, Rodney Gomez, Suriana Abdul Hamid, Tai Choon Seng

Judicial Review of Adjudication Under CIPAA An Australian Perspective on The Obligation of An Adjudicator to Comply with Natural Justice by John K. Arthur

Issues in Construction Adjudication in Singapore Lessons and Challenges for CIPAA by S. Magintharan

Mansource Interior Pty Ltd v Citiwall Safety Glass Pte Ltd [2014] SGHC 87: Natural Justice: Re-Balancing the Rights of the Parties under the Building and Construction Industry Security of Payment Act (Chapter 30 B) by Timothy Ng Wai Keong

Adjudicators Jurisdiction and Natural Justice in Adjudication in Singapore by Lawrence Tan Shien Loon and Teo Yi Hui

Capitol Avenue Development Sdn Bhd v. Bauer (M) Sdn Bhd (24C-5-09/2014) and UDA Holdings Bhd v. Bisraya Construction Sdn Bhd (24C-06-09/2014)

Being An Adjudicator: Are You Up to the Mark? by Daniel Tan Chun Hao

KLRCA CIPAA Circular 02 (Amended 1st August 2014)

CIPAA The Magic Wand of Payment Woes? by Tan Swee Im

Bayview Hotel, Penang / 15 August 2014 Construction Industry Payment & Adjudication Act 2012 (CIPAA 2012) Talk

The Timely CIPAA Adjudication Decision: Mission Impossible? by John Wong

Renaissance Hotel, Kuala Lumpur / 5 July 2014 #1 Practical Drafting & Defending of Adjudication Claims

The Journey Towards Security of Payment Legislation in Hong Kong by Christopher To

MSA Newsletter Vol. 1

Issue 2

JULY - DEC 2014

KLRCA CIPAA Circular 1A (11 November 2014)

CONTENTS

ii

Dear Members,

5 July 2014 marks the first year of the existence of the Malaysian Society of Adjudicators (MSA). The MSA was set up to promote adjudication as a means of dispute resolution for the construction industry.

Accordingly earlier this year, the MSA collaborated with the Kuala Lumpur Regional Centre for Arbitration (KLRCA) to organise two well-received Construction Industry Payment & Adjudication Act (CIPAA 2012) Conferences in Kuala Lumpur. The first annual general meeting of the MSA was held in June 2014 in conjunction with the second CIPAA 2012 Conference.

Contemporaneously with the first annual meeting and the June 2012 CIPAA Conference, the inaugural edition of the Newsletter of the MSA was published and distributed to the participants of the June 2014 CIPAA 2012 Conference and to the members of the MSA.

There have been several watershed events in 2014 for the construction adjudication community. The first was the triggering of the operative date for CIPAA 2012 on 15 April 2014. This accelerated the movement towards alignment by all stakeholders with CIPAA 2012. As of 3 November 2014, one consequence has been the submission of more than a dozen notices to the Director of the KLRCA to register adjudications under CIPAA 2012 and the filing of three actions in the Kuala Lumpur High Court relating to adjudication matters under CIPAA 2012. On 31 October 2014 the High Court orally ruled that CIPAA 2012 has a retrospective effect with section 41 applying only to limit its applicability to exclude proceedings that had been commenced in any court or arbitration before 15 April 2014. This landmark decision makes CIPAA 2012 applicable to a payment claim notwithstanding when the construction contract was signed or when a payment dispute crystallised or otherwise occurred. This ruling significantly expands the reach of CIPAA 2012 beyond the scope provided for in KLRCA CIPAA Circular 01.

As shown by the Contents page in this Newsletter, in-depth examinations of principles of natural justice and judicial review in the context of CIPAA and other forms of statutory construction adjudications are found in the In Focus section. Submissions on several questions and issues that have arisen or may arise under CIPAA 2012 are set forth in responses by four adjudicators to five questions in the Podium section. The articles in the Adjudicators Corner and in the Sidebar sections offer insights from adjudicators writing from several different professional and national experiences and perspectives. We are privileged to have in this issue the writings of adjudicators from Australia, Hong Kong, Malaysia, and Singapore.

I trust and hope that you will enjoy reading the informative and relevant articles in this Newsletter and look forward to an exciting 2015 as the adjudication and construction communities continue to align practices and procedures with the mandates of CIPAA 2012 that are designed to facilitate regular and timely payment, to provide a mechanism for speedy dispute resolution through adjudication, to provide remedies for the recovery of payment in the construction industry and to provide for connected and incidental matters.

Datuk Professor Sundra RajooPresidentMalaysian Society of Adjudicators

A WORD FROM THE PRESIDENT

PRESIDENTS PAGE

01

Aligning with CIPAA 2012! is the title of the second issue of the MSA Newsletter. It was selected to stress the predominant dynamic of the phase of CIPAA 2012 that started on 15 April 2014. True, the process of aligning operations, practices, procedures, and contractual documentation with CIPAA 2012 began in earnest with the enactment of CIPAA in 2012. But this process was a comparatively measured one, due in large part to the conceptual structure of section 1(2) authorising the Minister of Works to appoint a future date to bring CIPAA 2012 into operation.

Unsurprisingly, quite a few questions were voiced during the initial phases of preparing and training for the implementation of CIPAA 2012. Some questions turned on interpretations of the statutorily defined scope and content of payment claims under section 5 (such as, for one example, whether costs relating to extensions of time should be cognizable pursuant to section 5). Similarly questions regarding appropriate grounds for exemptions pursuant to section 40 were extensively mooted. Likewise, considerable energy was invested in analyzing questions on the application of CIPAA 2012 to contracts or payment disputes commenced before the operative date to be set by the Minister. Relatedly, the language of the savings provision in section 41 was minutely examined. In the absence of an operative date, however, these questions lacked the bite of an immediate reality.

On 15 April 2014, the Minister of Works established 15 April 2014 as the operative date, promulgated CIPA Regulations 2014, and issued CIPA [Exemption] Order 2014. This provoked a new urgency to align operations, practices, procedures, and contractual documents with the requirements of CIPAA 2012, CIPA Regulations 2014, and the CIPA [Exemption] Order 2014. In this context, hypotheticals yielded to concrete controversies as payment claims and notices of adjudication were served by parties to written construction contracts.

Between 15 April 2014 and 31 October 2014, a dozen plus notices to register adjudications were lodged with the Director of the KLRCA. Most of the notices were registered and adjudicators appointed. But the Director declined to register payment disputes that did not arise under a construction contract on or after 15.4.2014. In these instances, the Directors interpretation of CIPAA 2012 adhered to Circular 01.

Compared to positions taken by some observers that CIPAA 2012 should apply only to construction contracts signed after 15 April 2014, the Directors position reflected in Circular 01 was broader. Conversely, the Directors view on the applicability of CIPAA 2012 was narrower than the stance advocated by commentators who argued that CIPAA 2012 should apply to all payment disputes brought within the period of limitations that were not the subject of a proceeding in court or arbitration commenced before 15 April 2014. The existence of discordant positions on the important question of the applicability of CIPAA 2012 to payment disputes and contracts pre-dating 15 April 2014 meant that ultimately the different views would have to be resolved by judicial decision. This occurred when an important oral ruling on CIPAA 2012 was issued by the High Court in Kuala Lumpur (Commercial Division) on 31 October 2014. This decision is the subject of Decision Notes.

On 11 November 2014, the KLRCA announced that it would comply with and administer adjudication cases in accordance with the decision of the High Court and therefore issued Circular 1A to supersede Circular 01. Circular 1A is included in Happenings with the permission of the KLRCA. To start this issue, the Podium sets forth five highly relevant and pressing questions that were put to four accomplished members of the adjudication and construction community to obtain the benefits of

EDITORS DESKBy Michael Heihre

EDITORS PAGE

02

their insights. Their views were obtained before the 31 October 2014 oral ruling by the High Court and consequently do not reflect that development. The questions touch upon issues arising from the meaning of payment and Government used in section 4, CIPAA 2012, and in CIPA [Exemption] Order 2014. The Podium also solicited views from the four participants on the interpretation and scope of section 41, CIPAA 2012.

In Focus and Sidebar, the Newsletter offers thoughtful articles that suggest relevant lessons from Australia and Singapore - jurisdictions that preceded Malaysia by earlier adopting statutory schemes with aims similar to CIPAA 2012. Special attention is given in these articles to one of the anchoring principles of adjudication - natural justice. From Hong Kong, there is an article discussing the genesis and emergence of a regime of statutory adjudication of construction disputes that is featured in Sidebar. With its vibrant construction industry, adjudication in Hong Kong should provide valuable experiences for other jurisdictions with statutory adjudication schemes to consult for guidance and information.

The Adjudicators Corner in this issue concentrates on practical suggestions for adjudicators to improve the process of adjudication.

In Happenings, highlights of CIPAA related activities in the second half of 2014 are featured. For a timely and convenient reference, KLRCA Circular 1A issued on 11 November 2014 is included in this section of the Newsletter.

As noted in the first issue, this Newsletter is written to inform, stimulate interest, provoke thought, and contribute to the betterment of adjudication practice and procedure under CIPAA 2012. We hope that you find that this issue furthers those goals and leads readers to submit articles that contribute to the success of CIPAA 2012.

EDITORS PAGE

03

FIVE QUESTIONS Four respondents

No, because the current definition of payment in section 4 only refers to work done or services rendered under the express terms of a construction contract. In contrast, loss and expense, loss of profit, prolongation and delay costs, and extensions of time are costs that are related to the works or services rendered which the contractor may be entitled to claim as a result of certain events under the construction contract, but they are not categories of compensable items payable directly for work done or services rendered. Therefore, in this context it would be reasonable to include these items in the definition of payment under CIPAA by legislatively amending the present definition of payment in section 4. Otherwise, it is my reading of section 4 that these categories do not presently fall within the plain meaning of payment as used in CIPAA 2012.

Suriana abdul Hamid:

Generally, I agree that the definition of payment should include loss and expense, loss of profit, prolongation and delay costs because time is money and vice versa. However, because CIPAAs main objective is to ease obstacles to cash flow in the construction industry, the definition of payment should not include claims for time related losses. Furthermore, I dont think the Adjudicator has sufficient time to evaluate the time related losses due to the time limitations to resolve claims provided in CIPAA.

Tai CHoon Seng:

Yes, it should provided the construction contract expressly provides for the aforesaid items.

rodney gomez:

No. CIPAA is meant to be a quick fix with temporary finality to improve cash flow by dealing with simple claims for payment for work done or services rendered (see definition of payment in section 4). It should not be used to deal with complex claims needing more mature considerations. Provisional Sum and Contingent Sum claims should be included as long as they are claims in respect of work done or services rendered under the express terms of a written construction contract.

CHang Wei mun:

PODIUM

QUESTION 1:

In your view, should the definition of payment used in CIPAA 2012 be read to include: loss and expense, loss of profit, prolongation and delay costs, extensions of time, provisional sum items, and contingent sum items?

04

Yes. Although disputes arising from claims for loss and expense, loss of profit, prolongation and delay costs and extensions of time often require lengthy negotiation and time-consuming examination of voluminuous supporting documentation, the amount of money in controversy is similarly large. For this reason, they comprise an important component of the cash flow demands arising from a project. Since the CIPAA is aimed at facilitating regular and timely cash flows by providing a mechanism for speedy dispute resolution and rough justice, expanding the scope of payment disputes to include these items should provide additional options for contractors and consultants to choose for resolution of important cash flow issues depending on the particular nature of a dispute.

The inclusion of these items in the definition of payment may have the added benefits of widening the pool of adjudicators to attract individuals with significant construction and consultancy backgrounds and experiences. These individuals are often more familiar than many lawyers with these types of construction related disputes. This potentially greater expertise may lead to faster and more accurate adjudication decisions. In turn, this should result in a dispute resolution environment that is more encouraging and less intimidating to participants,

particularly smaller scale contractors. At the same time, the larger scale contractors who are more experienced in formal dispute resolution processes would have the option to go straight to arbitration or litigation.

Furthermore, payment disputes relating to variation order works can sum up to 15 to 20% of the monthly interim amount claimed by a contractor. Contractors may have no choice but to carry out the variation works before the rates for the variation can be agreed. It is not uncommon for there to be no agreement on rates even though the works have been completed and no payment received by the contractor for the variation work. Under these circumstances, most contractors would prefer to have the payment definition in CIPAA enlarged to include the extended categories of claims referenced in this question.

In any event, it is my view that section 7 and related provisions of the CIPAA should be further improved by providing clearer wording. This would help to minimize costly legal arguments over whether these items are covered and focus the parties on the cash flow issues rather than on the meaning of words used in the legislation intended to resolve cash flow problems.

Suriana abdul Hamid:

No. We should test the effectiveness of CIPAA in operation first before making any amendments.

Tai CHoon Seng:There is no need to amend as CIPAA 2012 has clearly provided what falls within the ambit of payment, i.e. the same must be expressly provided for in the contract.

rodney gomez:

No, and for the same reasons stated above in my response to question 1. The definition of payment in section 4, which will apply to sections 5, 6 and 27 to limit the type of claims that can be made, should remain as it is.

CHang Wei mun:

PODIUM

QUESTION 2:

In your view, as a matter of sound public policy, should CIPAA 2012 be legislatively amended to expand the scope of a payment dispute to include those items referenced in the preceding question or any difference between the parties to a construction contract or a construction consultancy contract along the lines of the Housing Grants, Construction and Regeneration Act (1996) as amended?

05

Yes, because these related contracts and agreements serve to achieve the purposes of the Government construction contracts that have been exempted and the exemption could be frustrated or cause unnecessary confusion if part of the process is exempt and other parts are not exempt.

Suriana abdul Hamid:

Yes. This is because logically any exemption pertaining to the Main Contract should have the same effect on the related subcontracts. Otherwise, it is not fair to the Main Contractor. Furthermore, some good intentions reflected in CIPAA i.e. stop work due to non-payment, requests for direct payment from the principal, etc. may not work practically if the exemption is only given to the Main Contractor.

Tai CHoon Seng:

No. In my view, the Exemption should not include related subcontracts, supply agreements, labour agreements and construction consultancy contracts as such interpretation would limit the application of CIPAA 2012.

rodney gomez:

Yes. That would be the fair thing to do. Otherwise, the burden of not being able to adjudicate will lie solely with the Main Contractor. The Exemption Order is not clear as to whether the exemption extends to related contracts.

CHang Wei mun:

PODIUM

QUESTION 3:

In your view, should the exemption given to a Government construction contract as specified in the First Schedule of the Construction Industry Payment and Adjudication [Exemption] Order 2014 be read to include related subcontracts, supply agreements, labour agreements, and construction consultancy contracts?

06

Wei Mun practices law as a partner of Messrs Raja, Darryl & Loh where he heads the construction and energy practice group. He is an accredited adjudicator and an experienced arbitrator. He has been involved in the dispute resolution process involving international airports, oil, gas and petrochemical facilities, dams and power stations, water treatment plants, and many other major projects. He is listed as a recommended lawyer for construction work in Asia Pacific Legal 500, Chambers Asia and Asialaw Profiles.

No, because a GLC is considered to be a private company in many respects. A GLC may be considered to be the Governments investment company, but nevertheless, it is not the same as being the Government. My interpretation of Government in CIPAA is that it should be limited to

the State Governments and the Federal Government. Additionally, there will be too many exemptions for CIPAA to have the intended beneficial consequences for the construction industry if GLCs are considered to be entitled to the status of the Government under CIPAA.

Tai CHoon Seng:

QUESTION 4:

Should the word Government as defined in section 4, CIPAA 2012 and as used in in CIPA [Exemption] Order 2014 be read to include government linked companies, government owned companies, and statutory bodies of the Government?

In general, no. The current definition of Government appears to be very broad, covering both the Federal and State Government. It would be useful to list exactly the identities of the relevant government bodies or agencies included in the definition of Government in the CIPAA. Preferrably, the definition of Government should not include government linked companies, government owned companies, or statutory bodies and local councils. This is because a significant portion of public infrastructure, built environment, and facilities/maintenance works in Malaysia are tendered out through these agencies.

The value of works out-sourced for tenders through these agencies allows for participation by various classes of contractors from Class A (> RM10 million) down to Class F (below RM200k) involving bumiputra

contractors. The latter class of contractors frequently are the most vulnerable to non-payment disputes owing to lack of understanding of contract provisions and poor documentation. If these agencies are included within the meaning of Government, the main objective of easing cashflow problems in the construction industry may not be achieved in the long run and the most needy elements of the industry may not be effectively assisted by the CIPAA.In my view, an expansive definition of Government should not be adopted. Instead, it should be sufficient to use the Governments power under section 40 to issue exemptions on a case by case basis taking into consideration the primary objective of the CIPAA to facilite regular and timely payment.

Suriana abdul Hamid:

No. In my view, government linked companies, government owned companies or statutory bodies of the government should not be included as this would restrict the application of CIPAA 2012.

rodney gomez:

The exemption should not apply to Companies incorporated under the Companies Act irrespective of who owns or controls them. However, I am not sure whether the exemption should apply to statutory bodies since some of them do play a direct governmental/administrative role e.g. local authorities.

CHang Wei mun:

PODIUM

Rodney Gomez is an accredited adjudicator with the Kuala Lumpur Regional Centre for Arbitration. He is a partner in Messrs Shearn Delamore & Co and specializes in building and construction law. He has appeared as counsel in arbitration, mediation, adjudication and Court proceedings.

07

QUESTION 5:

In your view, should CIPAA 2012 be read to apply to construction contracts and construction consultancy contracts made before 15 April 2014?

Suriana is the Head of Procurement and Contract Division of OPUS International (M) Bhd, a project management consultancy and asset management company. She has over 20 years of experience in project management and construction contract administration. She is a Quantity Surveyor (QS) registered with the Malaysian Board of Surveyors and a member of the Royal Institute of Surveyors Malaysia, the Australian institute of Quantity Surveyors, Australian Institute of Building and the Malaysian Institute of Management. She is also on the KLRCAs panel of Mediators and Adjudicators and a CIDB accredited Mediator.

Tai Choon Seng, MBA (Finance) Dip. Tech (Building), is an accredited adjudicator with Kuala Lumpur Regional Centre for Arbitration. He is the Project Director of Desa Parkcity Kuala Lumpur Office and a specialist in property development and project management.

Yes, as mooted by KLRCA in its circulars, CIPAA should apply to disputes arising after 15 April 2014 regardless of whether the contract was made before or after 15 April 2014 provided such contracts have not expired at the time of the start of the adjudication process. Otherwise, going for arbitration or litigation may be the better option, especially once the project is completed because the contractors interim cashflow would no longer be the driving factor for completion at that stage.

Suriana abdul Hamid:

Yes. CIPAA was approved by Parliament in 2012. In my opinion, CIPAA benefits the construction industry in many aspects and it is intended to remedy significant deficiencies in the present payment system. For these reasons, CIPAA should be enforced as early and as broadly as possible.

Tai CHoon Seng:

Yes it would apply. The problem is whether the Act actually applies to a payment dispute that may be subject to an arbitration or court proceedings before the coming into operation of the Act. This is unclear. If there was no arbitration or court proceedings then, it is clear that CIPAA still applies.

rodney gomez:

Yes and No. The procedural aspects should have retrospective effect. Those aspects that affect substantive rights (i.e. the abolition of the pay when paid clause) should not.

CHang Wei mun:

PODIUM

08

INTRODUCTION

1. Under the new Malaysian Construction Industry Payment and Adjudication Act 2012 (CIPAA) parties to construction contracts will be subject to compulsory statutory adjudication1. The policy of (CIPAA) is pay first, argue later in order to facilitate payment and cash flow in the construction industry2. CIPAA, and the various Australian models of security of payment legislation, as well as the New Zealand, Singapore, UK and other Commonwealth models3 seek to achieve similar objects, through similar legislative means, although there are also distinct differences4. For instance, unlike most of the jurisdictions which have adopted security of payment legislation, in Malaysia an aggrieved party to adjudication proceedings under CIPAA is given express recourse to apply to the High Court to set aside an adjudication decision on one or more of the grounds set out in s. 15 (a)-(d) CIPAA5. In Western Australia and the Northern Territory, rather than granting the contractor a statutory entitlement to progress payments6, the legislation implies terms into construction contracts dealing with a contractors entitlement to claim progress payments in absence of express provision.7 There are many other differences between the various Acts8.

2. In most jurisdictions, absent an express right of recourse to the courts, an aggrieved party must primarily rely on internal review by a review adjudication if provided for under the adjudication legislation9, or judicial review (seeking relief or remedy in the nature of certiorari, mandamus, prohibition or quo warranto), and if the legislation concerned permits, resisting enforcement of adjudication decisions on equivalent grounds10.

3. As the Malaysian Act gives an express right of recourse against the adjudication decision under s. 15 CIPAA, it remains to be seen whether Malaysian courts will be willing to admit a separate right to seek judicial review under O. 53 of the Rules of Court 2012, or in resisting enforcement of adjudication decisions under s. 28 CIPAA.

4. Subject to the distinct nature of CIPAA and its differences with the Australian and other models of security of payment legislation in the Commonwealth, the Australian experience over the past decade or more with statutory adjudication may provide helpful guidance to Malaysian courts and practitioners by way of comparison and analogy in interpreting and applying the Malaysian legislation.

IN FOCUS

JUDICIAL REVIEW OF ADJUDICATION UNDER CIPAA An AustrAliAn perspective on the obligAtion oF An AdjudicAtor to comply with nAturAl justiceBy John K. Arthur

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JUDICIAL REVIEW IN THE AUSTRALIAN CONTExT

5. Under the Australian legislation (except for limited rights under the WA and NT legislation), there are no express legislative rights of recourse to the courts. In the context of the statutory adjudication model, there are several important factors which suggest that full judicial review should not be available. The legislation was intended to provide a relatively quick and inexpensive process11 for the recovery of progress payments by persons who carry out work or supply goods or services in the construction industry.12 Significantly, the statutory regime was designed to operate on an interim basis and therefore may be adjusted or even reversed in further or other proceedings in a court, or arbitral tribunal or other form of dispute resolution under the contract13.

6. Despite these factors, it has been held in Australia that judicial review of an adjudication determination made under the legislation is available14:

(a) by certiorari15 on all of the grounds available under the writ, including for jurisdictional error, or error on the face of the record, and such relief is not excluded either expressly or by implication16;

(b) where the basic and essential requirements of the Act for a valid determination are not met (which may be equated with jurisdictional error);

(c) if it is not a bona fide attempt to exercise power under the Act17; and

(d) where there has been a substantial denial of the standard of procedural fairness which is required under the Act (which is also a jurisdictional error).

THE OBLIGATIONS OF AN ADJUDICATOR UNDER CIPAA TO COMPLY WITH NATURAL JUSTICE

7. One of the principal grounds relied upon by Australian courts for setting aside an adjudication determination is where a substantial denial of the measure of natural justice required under the Act18 is established.

8. Clearly an adjudicator under CIPAA has a duty to

comply with the principles of natural justice19. 9. Under the Malaysian Act, at the time of acceptance

of appointment, an adjudicator must make a written declaration that there is no conflict of interest in respect of his appointment20, that he shall act independently, impartially and in a timely manner and avoid incurring unnecessary expense21, he shall comply with the principles of natural justice22 and there are no circumstances likely to give rise to justifiable doubts as to the adjudicators impartiality and independence23.

10. Where there has been a denial of natural justice, or the

adjudicator has not acted independently or impartially, an aggrieved party has an express right to apply to the High Court to set aside an adjudication decision24. There may be a further right to resist enforcement under s. 28 CIPAA on the same grounds that would give a right to relief by way of judicial review (that the adjudicator exceeded his jurisdiction and failed to comply with the rules of natural justice)25, and ordinary judicial review may also be available.

IN FOCUS

10

WHAT ARE THE PRINCIPLES OF NATURAL JUSTICE WHICH APPLY TO STATUTORY ADJUDICATIONS IN AUSTRALIA?

11. While, unlike CIPAA, there is no express reference to the rules or principles of natural justice in any of the Australian models of security of payment legislation26, it has been held by courts around Australia that an adjudicator is under a duty to comply with the principles of natural justice27, taking into account the purpose and provisions of the various Australian Acts. While this is the case28:

(a) the particular content of the rules that will apply is derived from the context of the legislative regime established by the legislation enactments, including taking into consideration the truncated timetable in which the determination must be made29; and

(b) the denial of natural justice in each case must be material or substantial in the sense that it must have made a difference to the outcome30.

12. In South Australia the position is that an adjudicator

is required to afford natural justice to the parties and a failure to do so will result in the adjudication determination being a nullity31. The position is to the same effect in Queensland32, in Tasmania33 and in Western Australia34.

WHAT IS THE CONTENT OF THE REQUIREMENT TO AFFORD NATURAL JUSTICE IN ADJUDICATION PROCEEDINGS?

13. There are many examples of the requirement to afford natural justice in an adjudication context35 which are illustrative of the measure required:

(a) if an adjudicator is contemplating making a determination on a different basis from how the parties conducted the case, the adjudicator must inform the parties of that prospect so they have an opportunity to address any new issue, and a failure to do so will ordinarily result in a denial of natural justice or procedural fairness36;

(b) a failure by an adjudicator to have regard to relevant facts may amount to a denial of natural justice as the concern of the law is to avoid practical injustice37;

(c) if an adjudicator does not read the parties submissions at all38, or does not consider the adjudication response39, or possibly when the adjudicator fails to mention a critical issue40, there will be a denial of natural justice;

(d) a party is not permitted to add new claims, adduce new evidence or arise new arguments when the other side has no opportunity to respond41;

(e) the adjudicator has no jurisdiction to reach a decision that was not responsive to the issues referred in the adjudication or decide matters that were not referred,42 or was on a basis which was not advanced by either party43, or on the basis of evidence that was not before the parties44;

(f) the adjudicator may draw on the adjudicators own knowledge and expertise (see, s. 25(d) CIPAA), but must notify the parties of this intention and give them equal opportunity to comment and a failure to do so will be a breach of natural justice45;

(g) there is no requirement to hold a hearing46.

WHAT ARE THE CONSEQUENCES OF A FINDING THAT THE PRINCIPLES OF NATURAL JUSTICE HAVE BEEN CONTRAVENED?

14. If the principles of natural justice are contravened in respect of a particular adjudication, the court may:

(a) refuse relief on the basis that the denial of natural justice could not possibly have made a difference to the outcome47, or the party asserting a denial of natural justice had created the confusion which resulted in the alleged unfairness48; or

(b) find that the adjudication determination is invalid, and make a declaration of invalidity, or grant relief in the nature of certiorari to quash the adjudication determination or decision. The court may also remit the matter back to the adjudicator to be determined in accordance with law49.

CONCLUSION:

15. With the recent commencement of CIPAA, practitioners, stakeholders, and interested observers will need to wait to see to what extent Malaysian Courts are prepared to intervene in the adjudication process, what principles and tests will be applied in relation to setting aside, judicial review, and/or refusal of enforcement, of adjudication decisions, and how this will work for the operation of CIPAA. Given the commonalities between the various models of security of payment legislation and subject to their respective differences, it is to be expected (or at least hoped) that a distinct regional/Commonwealth jurisprudence will emerge which will assist practitioners and stakeholders across the region. The next step . . . harmonisation?50

IN FOCUS

11

1. KLRCA Adjudication Training Programme Training Manual Units 1 and 2, p. 5.

2. Ibid.

3. In Australia there are 8 different legislative models owing to the federal nature of the Australian legal system. There are stated to be 15 Commonwealth jurisdictions which have enacted statutory adjudication regimes: Best Practice in Construction Disputes, P Gerber and BJ Ong, LexisNexis, Aust., 2013 at para [16.14]. New South Wales was the first state to enact security of payment legislation in 1999 with the Building and Construction Industry Security of Payment Act 1999 (NSW) which was based on the adjudication provisions of the Housing Grants, Construction and Regeneration Act 1996 (UK) which grew out of the report by Latham, M. (July 1994) Constructing the Team - Final report of the government/industry review of procurement and contractual arrangements in the UK construction industry, The Department of the Environment, HMSO. The other legislation which followed was: Building and Construction Industry Security of Payment Act 2002 (Vic); Building and Construction Industry Payments Act 2004 (Qld); Construction Contracts (Security of Payments) Act 2004 (NT); Construction Contracts Act 2004 (WA); Building and Construction Industry Security of Payment Act 2009 (Tas); Building and Construction Industry Security of Payment Act 2009 (ACT); Building and Construction Industry Security of Payment Act 2009 (SA). Note also the Construction Contracts Act 2002 (NZ) and the Building and Construction Industry Security of Payment Act 2004 (Singapore). See Security of Payment Legislation in Australia, Differences between the States Vive la Diffrence? Hon. Justice Peter Vickery, Building Dispute Practitioners Society 12 October 2011; and Towards Harmonisation of Construction Industry Payment Legislation: A Consideration of the Success Afforded by the East and West Coast Models in Australia plus Addendum, Australasian Journal of Construction Economics and Building, 10 (3) 14-35, Coggins, J; Elliott, RF; Bell, M. See Statutory Adjudication Under Nine Commonwealth JurisdictionsA Users Perspective on Legislative Drafting Style by N A N Ameer Ali and Associate Professor Dr. S. Wilkinson, see http://www.opc.gov.au/calc/docs/Loophole_papers/Ali_Dec2010.pdf. For a summary of the Victorian Act, see Building and Construction Industry Security of Payment Act 2002 What Does it Do and How Does it Work? Available at http://www.gordonandjackson.com.au/ online-library. For general reference, see Security of Payment in New South Wales and Victoria, J. Wilson, Lexis Nexis, 2014 and Adjudication in the Building Industry by Phillip Davenport, 3rd Ed., The Federation Press, 2010.

4. CIPAA is economically contained in 41 sections (27 pages), but for example, the Victorian Act has 53 sections (and is spread over 76 pages). The NSW Act is spread over an economical 38 sections in 31 pages. The definition of construction work under CIPAA is seemingly broader under than under the Victorian or NSW Acts. Under the latter acts the definition of construction work does not include drilling for, or extraction of, oil or natural gas (s. 5(2) of each act). In Victoria, once the adjudicator accepts the nomination (s. 20(1), the adjudicator has the capacity to determine facts which go to his or her jurisdiction except for the case where the basic and essential requirements of the Act for a valid determination are not met, or where the determination is not a bona fide attempt to exercise the power granted under the act, ibid, Grocon Constructors v Planit Cocciardi Joint Venture (No 2) [2009] VSC 426; 26 VR 172 at 203) he or she has 10 business days (or up to 15 business days if the claimant agrees) to determine the adjudication application (the amount of the progress payment to be paid the respondent (if any) and the date when it is payable, and the rate of interest payable under s. 12(2): s. 23). Under CIPAA, the adjudicator has 45 days from the service of the adjudication response, or reply to such response, whichever is the later, or 45 days from the expiry of the prescribed period for service of the adjudication response if none is submitted: s. 12(2) CIPAA. The differences between acts in the various Commonwealth jurisdictions have been subject to adverse comment and a push towards harmonisation: see n. 2, Coggins, J; Elliott, RF; Bell, M. For a table of the differences in the Australian Acts, see, ibid Hon. Justice Peter Vickery, n. 3.

5. This is also the case in Singapore, see s. 27(5) Building and Construction Industry Security of Payment Act (SG) although the grounds are not expressly stated. See Sungdo Engineering & Construction (S) Pte Ltd v Italcor Pte Ltd [2010] SGHC 105.

6. Eg s 5 Singapore Act; s. 16 NZ Act; S. 9 Victorian Act; s. 8 NSW Act; s. 12 Qld Act; s. 12 Tas Act; s, 8 SA Act cf s. 36 CIPAA unless otherwise agreed right to progress payment.

7. S. 15 WA Act; s. 18 NT Act.

8. For a table of the differences between the Australian Acts, see, ibid Hon. Justice Peter Vickery, n. 3; and between the NSW and Victorian Acts, see , ibid, J. Wilson, n. 3.

9. By another adjudicator in an expeditious manner, eg Part 3, Div 2A of the Victorian Act.

10. See for example, Cantillon Ltd v Urvasco Ltd [2008] EWHC 282 (TCC) (Akenhead J), para [55]ff.

11. Which is free from excessive legal formality, and not bedevilled by unnecessary technicality: Hickory Developments Pty Ltd v Schiavello (Vic) Pty Ltd (2009) 26VR 112; [2009] VSC 156 at [46], and Grocon (No 2) ibid at n. 5, [112] cited with approved in Pearl Hill Pty Ltd v Concorp Construction Group (Vic) Pty Ltd [2011] VSCA 99 at [11].

12. The view has been expressed by one commentator that while the underlying intent of the act was to provide a simple means of facilitating cashflow, it is by no means a straight-forward task to navigate the legislation and its judicial consideration, Security of Payment in Victoria An Update, Vicbar and Commercial Bar Assoc, Construction Law Section, 13 Sept., 2010, by Matthew Bell, p. 12. The problem is compounded for practitioners operating across states and territories in Australia, ibid.

13. See s. 47(2), (3) and Grocon (No. 2), ibid, n. 5 at [110]-[111] cited with approval in Pearl Hill , n. 11 at [16]-[17].

14. See Maxstra Constructions Pty Ltd v Gilbert & Ors [2013] VSC 243 per Vickery J, [15] stating the law under the Victorian Act which subject to the differences in legislation between the Australian states and territories may be taken to apply Australia wide mutatis mutandis.

15. Ibid, Hon Justice Peter Vickery, at [61] citing ibid, Grocon (No 2) at n

5. The view has been expressed that Grocon (No 2) does not change the legal landscape much, as reviewable jurisdictional error derived from Brodyn Pty Ltd (t/as Time, Cost and Quality) v Davenport (2004) 61 NSWLR 421 and other cases already encompass the adjudicators failure to comply with the basic and essential requirements to make a bona fide attempt to exercise the power granted under the act or to accord natural justice: ibid, Matthew Bell at p. 8 referring to T. Shnookal, Security of payments in Victoria its use as an effective payment tool (2010) 38 Building Dispute Practitioners Society Newsletter 18.

16. The relief is sought under the local rules of court in each jurisdiction that are equivalent to O. 53 of the Malaysian Rules of Court 2012; See, ibid, Hon Justice Peter Vickery at [50] citing Hickory Developments and Grocon (No 2) at n. 5. Subsequently confirmed in Metacorp Australia Pty Ltd v Andeco Construction Group Pty Ltd (2010) 30 VR 141; [2010] VSC 255. And see Maxstra Constructions Pty Ltd v Gilbert & Ors [2013] VSC 243 per Vickery J, [15]. In New South Wales since Chase Oyster Bar Pty Ltd v Hamo Industries Pty Ltd (2010) 78 NSWLR 393, certiorari is available to set aside an adjudicators determination on the ground of jurisdictional error (which overturned Brodyn Pty Ltd, ibid at n. 14, largely applying Grocon (No 2) at n. 5). The situation is similar in other States, see eg. A J Lucas Operations Pty Ltd v Mac-Attack Equipment Hire Pty Ltd [2009] NTCA; Perrinepod Pty Ltd v Georgiou Building Pty Ltd [2011] WASCA 217 at [96], [113]; Northbuild Construction Pty Ltd v Central Interior Linings Pty Ltd [2012] 1 Qd R 525; Built Environs Pty Ltd v Tali Engineering Pty Ltd and Ors [2013] SASC 84 at [209]; Skilltech Consulting Services Pty Ltd v Bold Vision Pty Ltd [2013] TASSC 3 at [7].

17. Ibid, Brodyn Pty Ltd at n. 14 part of which decision was applied by Vickery J in Hickory; and Grocon (No 2) at n. 5, [166], ibid. See, Building balances into progress payments, by Ben Patrick (2010) 85 LIJ 28. See also Asian Pacific Building Corporation Pty Ltd v Aircon Duct Fabrication Pty Ltd [2010] VSC 300 at [25]; Claude Neon Pty Ltd v Rhino Signmakers Pty Ltd [2010] VSC 619; and Maxstra Constructions, ibid at n. 15, [15] where availability of judicial review and of associated remedies in respect of adjudication determinations made under the Act is summarised. The availability of judicial review and of associated remedies for adjudication determinations made under the security of payment legislation in Victoria have been authoritatively stated in Maxstra Constructions , ibid at [15].

18. Ibid, Maxstra Constructions Pty Ltd v Gilbert & Ors at n. 15.

19. S. 24(c) CIPAA.

20. R. 3(c) Kuala Lumpur Regional Centre for Arbitration Adjudication Rules and Procedure (revised 1 August, 2014); Reg. 5(4) Construction Industry Payment and Adjudication Regulations 2014.

21. S. 24 (b) CIPAA.

22. S. 24 (c) CIPAA.

23. S. 24 (d) CIPAA.

24. S. 15(b), (c) CIPAA.

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25. Which is the case in the UK, see for example, Cantillon Ltd v Urvasco Ltd [2008] EWHC 282 (TCC) (Akenhead J), para [55]ff. For Singapore position, see n. 5 above.

26. Adjudication in the Building Industry by Phillip Davenport, 3rd Ed., The Federation Press, 2010 at p. 238.

27. For example, Brodyn, ibid at n. 14; [2004] NSWCA 394 per Hodgson JA at [55]; Reiby Street Apartments Pty Ltd v Winterton Constructions Pty Ltd [2005] NSWSC 545 per Macready AsJ at [22]; Metacorp Australia, ibid at n. 15; Allpro Building Services Pty Limited v Micos Architectural Division Pty Limited & Ors [2010] NSWSC 474. The right to seek to have an adjudication decision reviewed for breach of natural justice has been subject to criticism from at least one commentator who has argued that as an adjudicators role is that of essentially a certifier, there is no reason why the principles of natural justice should apply. It is argued that each of the Australian Acts has a provision similar or identical to s. 22(2) of the NSW Act which provides that in determining an adjudication application, the adjudicator is to consider certain matters only including the provisions of the act, the provisions of the relevant construction contract, the relevant payment claim, together with all submissions (including relevant documentation) that have been duly provided by the parties and the results of any inspection carried out by the adjudicator of any matter to which the claim relates. It is argued that courts have no need to go further than these principles in determining an adjudication application: Ibid, Davenport at p. 238.

28. The rules of natural justice also generally apply to adjudication under the UK legislation: Amec Group Limited v Thames Water Utilities Limited [2010] EWHC 419 (TCC) at [21], [54] (per Coulson J) citing see Discain Project Services Limited v. Opecprime Developments Limited [2001] BLR 287 and RSL (South West) Limited v. Stansell Limited [2003] EWHC 1390 (TCC).

29. Watpac Construction (NSW) Pty Ltd v Austin Corp Pty Ltd [2010] NSWSC 168 at [142] per McDougall J. According to a recent authority from New South Wales provided there has been a bona fide attempt by the adjudicator to exercise the relevant power and no substantial denial of natural justice of the kind required by the Act, the courts approach should be not to apply an overzealous analysis to the determination of an adjudicator, but rather to take a practical approach, concentrating on the effect of the determination and the reasons of the adjudicator: Maxstra NSW Pty Ltd v Blacklabel Services Pty Ltd [2013] NSWSC 406 per Rothman J (at [79] also see Grocon No. 2, ibid at n. 5 at [143]; Watpac Constructions, ibid , [147].

30. John Holland Pty Ltd v TAC Pacific Pty Ltd [2009] QSC 205 ; [2010] 1 Qd R 302 (at [40]) per Applegarth J relying upon Stead v State Government Insurance Commission and Ex parte Aala; Trysams Pty Ltd v Club Constructions (NSW) Pty Ltd [2008] NSWSC 399 per McDougall J at [52]; Maxstra NSW , ibid at n. 28at [79]. Recently in Anderson Street Banksmeadow Pty Ltd v JCM Contracting Pty Ltd [2014], Ball J. summarised the relevant principles (at [46]).

31. Built Environs Pty Ltd v Tali Engineering Pty Ltd and Ors [2013] SASC 84 , [128] (Blue J) citing by way of example, John Holland Pty Ltd v Cardno MBK (NSW) Pty Ltd [2004] NSWSC 258 at [10], [40][41] per Einstein J; Brodyn , ibid at n. 14 at [57]; Grocon (No 2) at n. 5 at [133][139] per Vickery J.

32. James Trowse Constructions Pty Ltd v ASAP Plasterers Pty Ltd and Ors [2011] QSC 145, [45] relying upon David & Gai Spankie & Northern

Investment Holdings Pty Ltd v James Trowse Constructions Pty Ltd (No 2) [2010] QSC 166 at [10].

33. Skilltech ibid at n 15, [26]ff.

34. MRCN Pty Ltd (t/as Westforce Constructions) v ABB Australia Pty Ltd [2014] WASAT 59 at [48].

35. Sourced from KLRCA Adjudication Training Programme Training Manual Unit 1 and 2, pp. 16-17.

36. Musico v Davenport [2003] NSWSC 977, [107]-[108]; Seltsam Pty Ltd v Ghaleb [2005] NSWCA 208, [78]-[79] per Ipp JA with Mason P agreeing, referred to in Skilltech ibid at n. 15at [24]-[26].

37. Procorp Civil Pty Ltd v Napoli Excavations and Contracting Pty Ltd [2006] NSWSC 205 at [10], point (xiv).

38. Timwin Construction Pty Ltd v Faade Innovations Pty Ltd (2005) 21 BCL 383 [2005] NSWSC 548 cited in Skilltech, ibid at n 15, [76].

39. Reiby Street Apartments v Winterton Constructions [2006] NSWSC 375 cited in Skilltech, ibid at n 15.

40. Brook Hollow Pty Ltd v R & R Consultants Pty Ltd [2006] NSWSC 1, [57]-[58] cited in Skilltech, ibid at n 15.

41. McAlpine PPS Pipeline Systems Joint Venture v Transco Plc [2004] EWHC 2030 (TCC); [2004] BLR 352 at 356, per Judge Toulmin GMG QC; London and Amsterdam Properties Ltd v Waterman Partnership Ltd [2003] EWHC 3059 (TCC); [2004] BLR 179 at 201 per Judge Wilcox.

42. Principle referred to in McAlpine PPS Pipeline Systems Joint Venture at n. 40.

43. Ardmore Construction Ltd v Taylor Woodrow Construction Ltd [2006] CSOH 3.

44. See Hyder Consulting (UK) Ltd v Carillion Constructions Ltd [2011] EWHC 1810 (TCC); and for a similar Australian decision, see Metacorp Australia, ibid at n 15 where there was found to be a breach of natural justice by the adjudicator when claimant raised new issue; respondent requested opportunity to respond and the adjudicator refused. The new matter was material to the adjudicators decision. See also TQM Design & Construct Pty Ltd v Dasen Constructions Pty Ltd [2004] NSWSC 1216 at [26]-[31].

45. Carillion Utility Services Ltd v SP Power Systems Ltd [2011] CSOH 139; Hyder Consulting (UK) Ltd v Carillion Constructions Ltd [2011] EWHC 1810 (TCC).

46. ROK Building Ltd v Celtic Composting Systems Ltd [2009] EWHC 2664 (TCC).

47. Eg Shorten v David Hurest Constructions Pty Ltd Ltd [2008] NSWSC 546 at [23] and see Watpac, ibid at [147].

48. Veolia Water Solutions v Kruger Engineering [2007] NSWSC 46 at [53].

49. Metacorp, ibid at n. 15.

50. See ibid, Coggins, J; Elliott, RF; Bell, M at n. 4.

John K. Arthur, BA, LLB, DipICArb, FCIArb, Barrister, Isaacs Chambers, Melbourne, is a Fellow of CIArb and ACICA, and empanelled on the KLRCAs arbitration, adjudication and mediation panels. John is a member of the Victorian Bar of over 24 years standing. His principal area of practice is general commercial litigation including contracts, sale of land, property, equity, corporations, and estates. He is a Nationally Accredited Mediator (ACDC) and a trained adjudicator (KLRCA). For his full profile, go to: http://www.vicbar.com.au/Profile?2419. John is keen for lawyers to embrace harmonisation of Australian law and ADR, especially international and domestic commercial arbitration, and to reach out to, and build professional, cultural and personal links with Asia.

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INTRODUCTION

Construction adjudication was adopted by Singapore in 2004 with the Singapore Parliament enacting the Building and Construction Industry Security of Payment Act [Cap 30B (hereinafter referred to as SOPA]1. SOPA was modelled after the New South Wales Act, Australia2 which in turn found its inspiration in the English SOP [E] Act3. Malaysia is the most recent jurisdiction to accept construction adjudication with the enactment of the Construction Industry Payment & Adjudication Act 2012 [CIPAA]4 by the Malaysian Parliament on 22 June 2012 and the establishment of an operative date of 15 April 2014.5

However, the provisions of SOPA are not pari materia that is, read as one - with the statutory adjudication schemes of the SOP [NSW] and/or the SOP [E] and/or CIPAA and since its enactment there have been significant legal issues raised relating to the validity of payment claims and jurisdictional challenges resulting in divergent views expressed in the Singapore High Courts.5 On 2 November 2012, the Singapore Court of Appeal in Lee Wee Lick Terence v Chua Say Eng [hereinafter referred to as Chua Say Eng]6 sought to resolve these divergent and conflicting views which had persisted for several years in Singapore and laid down important principles with significant implications for construction adjudication in Singapore. This article summarizes the legal issues encountered in Singapore with regard to its statutory construction adjudication scheme and from this history highlights lessons and potential challenges under CIPAA.

SIGNIFICANT ISSUES PRIOR TO THE SINGAPORE COURT OF APPEALS DECISION IN CHUA SAY ENG

Prior to the Singapore Court of Appeals decision in Chua Say Eng, there were five [5] main areas of controversy in construction adjudication in Singapore:7 1. The first significant issue concerned the question

as to whether the High Court had the jurisdiction to determine if there was a valid payment claim and to set aside an adjudication determination. Justice Judith Prakash in a trilogy of cases in the High Court of Singapore8 held that whether there was a valid payment claim was a question only for the adjudicator to decide and was not a subject for the High Court to review. On the contrary, Lee Sieu Kin J in Sungdo Engineering & Construction (S) Pte Ltd v Italcor Pte Ltd9 (hereinafter referred to as Sungdo) disagreed and held that it was a question for the High Court to determine and review and the decision was subject to judicial review.

2. The second issue was whether the application for setting aside or a challenge to the adjudication award in the High Court was to be determined by a High Court Judge or by an Assistant Registrar of the High Court10. Both the SOPA and its Regulations do not provide any indication on the nature and process for setting aside an adjudication determination by the High Court [ what and how, if not why ] albeit there is an express provision for an unique11 review procedure to challenge the merits of the adjudicators decision before an adjudication review tribunal. Even Order 95 Rule 3 of the Rules of Court, Singapore12, which was introduced to facilitate the applications to enforce and setting aside adjudication determination to the High Court under SOPA, is unclear as to whether the application is in the nature of a judicial review and whether it should be heard by a High Court judge thereby contributing to the unsatisfactory practice of setting aside applications continuing to be heard in the first instances by Assistant Registrars of the High Court instead of the High Court Judges.

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ISSUES IN CONSTRUCTION ADJUDICATION IN SINGAPORE lessons And chAllenges For cipAA*By S. Magintharan

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3. The third significant issue concerned the controversy as to whether there was a requirement under the SOPA for the claimant to subjectively communicate to the respondent that the payment claim was issued under the SOPA. This issue arose because SOPA, unlike its model SOP [NSW]13, did not expressly mandate that the Claimant shall state in the payment claim [as opposed to a progress claim] that it was a payment claim under the SOPA. In Sungdo, Lee J laid down, as part of the Sungdo principles14 that even though the SOPA did not have such a stipulation, the claimant had to subjectively communicate to the respondents that the payment claim is in fact a payment claim under the SOPA in order to prevent the SOPA from being used as an instrument of oppression15. Tay J at the first instance in the Singapore High Court in Chua Say Eng disagreed with the view that there was a need for the claimant to subjectively communicate to the respondent that the payment claim was under the SOPA for it was not expressly mandated by Parliament16.

4. The fourth controversy was whether s.10 [2] (b) SOPA read with SOPA Reg. 5[1] imposed a one-month limitation period on the claimant to serve the payment claim for works done (unless a contrary provision is contained in the construction contract) in relation to works in the previous month by the last day of each month following the month in which the contract was made, failing which the claimant was barred from making any payment claim for the works done in respect for the same period.17 The High Court in Chua Say Eng disagreed with the decision of the Assistant Registrar in refusing to set aside the payment claim on the basis that the payment claim was served later than the one-month limitation period18.

5. The fifth controversy concerned what amounted to a

repeat claim under the SOPA and therefore debarred under s.10 [1] SOPA. Section 10 [1] SOPA expressly provided that a claimant may serve one payment claim in respect of a progress payment and section 10 [2] SOPA provided that the payment claim shall be served at such time specified or determined in accordance with the terms or if the contract did not provide such a provision, at such a time as may be prescribed. In Doo Ree Engineering & Trading Pte Ltd v Taisei Corp19, the Assistant Registrar of the Singapore High Court was of the view that the payment claim was a repeat claim under the SOPA even though the previous payment claim was not adjudicated upon20.

BRIEF FACTS OF CHUA SAY ENG

Chua Say Eng (C) was a civil engineering contractor. Lee Wee Lick Terence (L) was the owner of a property. L employed C to convert his two-storey house into a three-storey house. Disputes arose which resulted in L terminating the contract on 26 April 2010. In 2 June 2010, C served a document described as Payment Claim No: 6 (PC 6) on L claiming the sum of S$140,450.40 for work done for the period June 2009 to 26 April 2010. There was no reference in PC 6 that it was a payment claim made, or served under the SOPA. L did not serve a payment response as required under s. 11 SOPA. C then applied for adjudication under s.13 SOPA on the ground that there was no payment response and under s.15 (3) SOPA, L was precluded and the adjudicator prohibited from considering any of Ls reason for withholding any amount, including but not limited to any cross-claim and set-off since L had failed to serve the mandated payment response.21 The adjudicator, who was appointed under s.14 SOPA, made an adjudication determination in favour of C in the sum of S$125,450.40. L did not pay the adjudication amount and C applied under s. 27 (1) SOPA for leave to enforce the said determination. L on the other hand commenced an application to set aside the adjudication determination on, inter alia, the grounds that (a) PC 6 was not a valid payment claim under the Act and (b) PC 6 was served out of time.

The application to set aside the adjudication determination came before the Assistant Registrar of the High Court of Singapore but was dismissed22. L appealed against the decision of the Assistant Registrar to the High Court and reiterated his arguments that:

a. PC 6 was not a valid payment claim under the SOPA because:

i. PC 6 was not a valid payment claim under the SOPA for it did not expressly state that it was a payment claim under the Act and

ii. C had not subjectively communicated to L the intention to make a payment claim under the SOPA23.

b. PC 6 was served out time because it was not served within the limitation period of one month from the last day of each month following the month in which the contract is made under s.10(2) SOPA, read with Reg. 5(1).

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THE DECISION OF THE SINGAPORE HIGH COURT IN CHUA SAY ENG24

Ls appeal came before Justice Tay Yong Kwong [Tay J]. His Honour, inter alia, held as follows in allowing Ls appeal in part:

a. At the outset, his Honour considered the preliminary issue: What should the court review? and the controversy as to whether the High Court had the jurisdiction to review and set aside adjudicators determination if there was no valid payment claim . Tay J agreed with and followed the view expressed by Lee J in Sungdo Engineering that High Court had the jurisdiction to review the decision of the adjudicator as to the validity of a payment claim25. However, recognising conflicting views in the High Court, the Learned Judge26 granted leave for the parties to appeal to the Court of Appeal in order to clarify the law.

b. On the issue as to whether PC 6 was a valid payment claim under the SOPA the Learned Judge dismissed Ls appeal on the ground that:

i. PC 6 was a valid payment claim and that under the SOPA the payment claim does not need to contain a stipulation that it was a payment claim under the SOPA.

ii. There was no statutory requirement under the SOPA for the claimant to subjectively communicate to the respondent that the intention was to make a payment under the SOPA27.

c. On the limitation period, the Learned Judge allowed

Ls appeal for he interpreted s.10 (2) (b) SOPA and SOPA Reg. 5 (1) as imposing a one-month limitation period on the claimant to serve the payment claim by the last day of each month following the month in which the contract was made. On the facts of Chua Say Eng, the Learned Judge held that the construction contract was made on 31 November 2008 and as such Cs payment claim for work done in April 2010 should be served not later than 31 May 2010. The Learned Judge held that, on the facts, since the payment claim was only served on 2 June 2010, it was served out of time for the April 2010 claim and therefore out of time.

Both parties appealed to the Court of Appeal, with leave, from the decision of the High Court. L appealed against the High Courts decision that PC 6 was a valid payment claim and C appealed against the High Courts decision that held that PC 6 was served out of time.

THE DECISION OF THE SINGAPORE COURT OF APPEAL AND RELEVANCE TO CIPAA

The Singapore Court of Appeal heard full arguments on 17 October 2011; took time to deliberate on the important issues with reference to the SOPA model of SOP [NSW] and the New South Wales Court of Appeal decisions of Brody Pty Ltd v Davenport28 and Chase Oyster. The Court of Appeal delivered its judgment on 2 November 201229 setting out the following significant principles governing construction adjudication in Singapore.

[1] Resolution of divergent views on whether the High Court had jurisdiction to review the decision of the adjudicator

The Court of Appeal at the outset sought to resolve the conflicting approaches adopted by the Singapore High Court in Chip Hup Hup Kee and Sungdo Engineering. The Court of Appeal reconciled the different approaches adopted by the High Courts on the legal basis that they dealt with different issues and therefore were both correct for the following reasons:

a. The Court of Appeal held that the approach taken by the High Court in Sungdo Engineering concerned the validity of a payment claim which went to the appointment of the adjudicator and thus a jurisdictional issue and therefore the High Court had the jurisdiction to review the adjudicators determination30.

b. Whereas, the Court of Appeal held, that the approach taken by the High Court in Chip Hup Hup Kee [and the related cases] concerned a situation where there was a valid payment claim but the payment claim was defective for non-compliance with the requirements of the Act which the Court of Appeal held goes to the validity of the adjudication determination [merits of the adjudication] and therefore was not a jurisdiction question reviewable by the High Court31.

c. The Court of Appeal held that when there is a challenge to the validity of the appointment of an adjudicator [including whether there was a valid payment claim], such questions were jurisdictional issues and only the High Court [and not the adjudicator] had the power and duty to review the adjudication proceedings. On the other hand, the Court of Appeal held that in the case of the challenge to the validity to the adjudication determination [merits], then the issue was not one that went to the jurisdiction of the adjudicator and therefore one for only the adjudicator to decide [subject to review to the review tribunal] and not one for the High Court to review32.

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This aspect of Chua Say Eng was quickly embraced and applied by the Singapore High Courts and the Singapore Court of Appeal in WY Steel Construction Pte Ltd v Osko Pte Ltd33.

In Admin Construction Pte Ltd v Vivaldi (S) Pte Ltd34, Quentin Loh J, reiterated and applied the principles set out by the Court of Appeal in Chua Say Eng and set aside an adjudication determination on the basis, inter alia, that the payment claim upon which the adjudication determination was made was invalid because there was no existing construction contract at the time the payment claim was served for the parties had entered into and compromised all their claims prior to the payment claim. The Learned Judge held that the compromised agreement, which was ex facie valid at the time the payment claim was served, extinguished all the claimants claims under the construction contract and as such the claimant had no legal right to invoke the SOPA and the adjudicator no jurisdiction to make any adjudication determination under the SOPA. The Learned Judge held that the question as to whether there was an existing construction contract was a jurisdictional question to be determined by the High Court and not the adjudicator. The decision of the Singapore High Court was affirmed in the Court of Appeal35.

Similarly, in the recent case of YTL Construction (S) Pte Ltd v Balanced Engineering & Construction Pte Ltd36, Tan Siong Thye J, the Singapore High Court applied the principles stated by the Court of Appeal in Chua Say Eng and set aside an adjudication determination on the basis, inter alia, that the payment claim was invalid for it did not state the amount claimed by reference to the period to which the payment related [as required under s.10 (3) (a) SOPA] and that such irregularity could not be waived as it was jurisdictional37. The High Court also held that an adjudicator under s.16 (2) (a) SOPA was bound to reject an adjudication application which was commenced out of time38.

Unlike the SOPA, the role of the High Court in setting aside the adjudication determination is much clearer under the CIPAA. Section 15 CIPAA expressly provides for an aggrieved party to apply to the High Court to set aside an adjudication decision on four [4] grounds39 all of which are public law and jurisdictional grounds. It follows therefore that under CIPAA the role of the High Court is similar to that under SOPA - supervisory, prerogative and the process is by way of judicial review. It is respectfully submitted that the principles laid by the Singapore Court of Appeal in Chua Say Eng that the High Court will only decide jurisdictional challenges [including validity of payment claim and payment response] and not the merits of the adjudication determination [unless it falls within Wednesbury unreasonableness] would equally apply to an application to set aside an adjudicators determination under the CIPAA.

[2] Roles of the adjudicator nominating body [ANB], adjudicator, and the high court clarified

Treating the case before it as a test case, the Singapore Court of Appeal proceeded to clarify and limit the roles of the ANB, Adjudicator, and the High Court as follows:

a. The Court of Appeal limited the role of the ANB to merely administrative in nature when appointing an adjudicator. The ANB merely served as an administrative body under the SOPA40 for the receipt of the adjudication application, appointment of the adjudicator and the adjudication process. The Singapore Court of Appeal emphatically stated that the ANB had no legal obligation to consider the validity of the payment claim or process in the following terms41 :

The ANB has no obligation to consider the bona fides of the claimants request by looking into or questioning whether the payment claim is intended to be a payment claim, whether it has been served or properly served on the respondent, or whether it complies with all the requirements of the Act [Emphasis mine]

The essential role played by the KLRCA under CIPAA is similar to that of the ANB in Singapore and serves merely as an administrative body in the appointment of adjudicators and administering of the adjudication process rather than in any judicial or quasi-judicial capacity. In the premises, it is respectfully submitted that the dicta of the Singapore Court of Appeal in Chua Say Eng on the limited role of the ANB in Singapore is equally applicable to the limited role of the KLRCA under the CIPAA. In particular, it is submitted that it is certainly not the role of the KLRCA to consider the validity of the payment claim/payment response. b. The Singapore Court of Appeals clarification on the role

of the adjudicator under SOPA is rather controversial42 for the following reasons:

i. The Court of Appeal held that the function of the adjudicator under the SOPA was limited to:

[1] deciding whether the adjudication application in question was made in accordance with section 13 [3] (a) to (c) SOPA.

[2] that if the adjudication application complied with the requirements under s.13 (3) (a) (c) SOPA, to determine the adjudication application in accordance with s.17 (2) SOPA.

ii. The Court of Appeal held that the adjudicator was not competent to decide whether he was validly appointed to adjudicate the matter and that such argument should be made to the court43.

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The present author respectfully reiterates his submission elsewhere (see endnote 42) that the Singapore Court of Appeals ruling that the adjudicator was not competent and did not have the jurisdiction to decide on the validity of the payment claim/payment response and consequently, his appointment, is wrong for the adjudicator is mandated under 17 (3) (a) (h) SOPA to decide such questions which are the basic and essential conditions imposed by SOPA.44

The stance taken by the Singapore Court of Appeal is also, it is respectfully submitted, contrary to the role of the adjudicator under CIPAA. The jurisdiction of the adjudicator under the CIPAA is clearly set out in s.27 CIPAA and it is mandated that the adjudicator jurisdiction is limited to adjudicating on the payment claim [under section 5 CIPAA] and payment response [under section 6 CIPAA] unless the jurisdiction is extended in writing under section 27 [2] CIPAA by the parties. It is therefore submitted that, unlike the position in SOPA [as set out in Chua Say Eng], under CIPAA the adjudicator has the jurisdiction to decide on the validity of the payment claim and the payment response. It is submitted that under CIPAA, the validity of the payment claim and the payment response are basic and essential conditions which have to be decided by the adjudicator, failing which the adjudication decision will be void and not voidable [as per Hodgson JA in Brodyn Pty Ltd v Davenport [2004] NSWCA 394 at [52] [55]). However, unlike the SOPA and SOP [NSW], CIPAA, under section 27 [3], expressly bestows on the adjudicator a statutory discretion not to decide the jurisdictional challenge [including the validity of the payment claim and the payment response] and to proceed with and complete the adjudication proceedings despite the jurisdictional challenge. As such, it follows that under section 27 (3) CIPAA the adjudicator is not bound to decide the basic and essential conditions as to the validity of the payment claim and payment response. It is respectfully submitted that section 27 (3) CIPAA is a very unusual provision indeed. Although the clear intention behind section 27 (3) CIPAA, is to reiterate the underlying purpose of CIPAA to provide a speedy and low cost adjudication, it is respectfully submitted that, it will be counter-productive to the whole intention of CIPAA and a complete waste of costs to the parties for an adjudicator to exercise his discretion not to decide on the validity of the payment claim and/or the payment response and to proceed with and complete an adjudication application when it is clear from the evidence at the outset that the payment claim is invalid. It is further respectfully submitted that the prudent and proper exercise of discretion will be for the adjudicator to decide any jurisdictional challenge on the validity of the payment claim and/or response or any other jurisdictional issues under s 27 [1] CIPAA and only to proceed with the adjudication when such challenges are unsubstantiated or invalid or unclear. Finally on this point, it is respectfully submitted that a deliberate refusal by an adjudicator under CIPAA to consider whether to exercise the statutory discretion may by itself amount to a fettering of the adjudicators statutory discretion and be

subject to judicial review in the High Court.

c. The Singapore Court of Appeal held45 that the High Courts role in setting-aside an adjudicators determination is as follows:

i. The High Court should not review the merits of the adjudicators determination.

ii. The High Court has the power [and duty] to decide matters which go to the jurisdiction of the adjudicator and affect the validity of the adjudicators appointment in particular where there is no payment claim or service of the payment claim, the appointment of the adjudicator will be invalid, and the resulting adjudication determination would be null and void.46

It is respectfully submitted that for reasons stated above, the principles laid by the Singapore Court of Appeal in Chua Say Eng that the High Court will only decide jurisdictional challenges [including validity of payment claim & payment response] and not the merits of the adjudication determination [unless it falls within Wednesbury unreasonableness] are relevant and equally applicable in setting aside the adjudicators determination under section 15 of the CIPAA for it is by way of a judicial review and it is trite law that the role of the High Court in a judicial review is only to review the legality of the decision and not its merits.

[3] The gloss on the Sungdo Principles

The Singapore Court of Appeal considered the Sungdo Principles holding that, despite the lack of an express stipulation in the SOPA [unlike the SOP (NSW) and CIPAA], the claimant was required to communicate the subjective intention to the respondent that the claim served on the respondent is in fact a payment claim under the SOPA.47 The Singapore Court of Appeal recognized that the lack of a stipulation or communication in the payment claim would result in a certain amount of inconveniences and even hardship on potential respondents who are considering what action to be taken to protect their interest in the context of the Act48. Notwithstanding the potential hardship to the respondent, the Court of Appeal refused to approve the Sungdo principles; instead holding that since Parliament had deliberately omitted49 to impose such a requirement on the claimant, the respondent is to treat every claim submitted to the claimant that satisfies the requirement of the Act as a payment claim and respond accordingly50. The Singapore Court of Appeal imposed a gloss on the Sungdo principles and limited their application to its own peculiar facts where the court is seeking to prevent unscrupulous contractors who take advantage of the legislative scheme.

The decision of the Court of Appeal is very unfortunate51, especially since the respondent under section 15 [3] SOPA [and s 15(4) & 20 SOP (NSW)] is subject to the draconian

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consequence of not being able to raise any defence, set-off, cross-claim for withholding payment unless it is contained in the payment response served within the strict time-lines under the SOPA. This draconian effect is further exasperated by the recent Singapore Court of Appeal decision in WY Steel Construction Pte Ltd v Osko Pte Ltd52 which confirmed that the respondents failure to serve a payment response is a jurisdictional issue and held that respondent is precluded from raising and the adjudicator had no jurisdiction to consider any defence, cross-claim or set-off not raised by the respondent in the payment response.

The draconian consequences to respondents under s 15 [3] SOPA [SOP [NSW] & SOP [E]) is thankfully anticipated and avoided under the CIPAA by the express stipulation under s 5 (d) CIPAA that the payment claim shall include a statement that it is made under the Act [as in the case of s. 13(3) (c) SOP [NSW]), the unusual provision of s.6(4) CIPAA which expressly provides [unlike the SOP [E], SOP [NSW] & SOPA] that a non-paying party who fails to respond to a payment claim in the manner provided under this section is deemed to have disputed the entire payment claim [emphasis mine] and the glaring absence of the equivalent draconian provision contained in of s 15[3] SOPA, s 15(4) & 20 SOP (NSW) & s 111 SOP (E) in the CIPAA.

[4] The was no one month limitation period for the service of a payment claim under the SOPA

The Singapore Court of Appeal then considered Cs appeal against the High Courts interpretation of section 10 (2) (b) SOPA and SOPA Reg. 5 that imposed a limitation period53 on the claimant and the claimant had to serve the payment claim for monthly works by the last day of each month following the month failing which the claimant was debarred from making a claim for preceding months construction works carried out. The Court of Appeal disagreed54 with the High Court that Cs payment claim was debarred and served out of time for the following reasons:

a. On the facts, the Court of Appeal held55 that the High Court Judge had erred in failing to take into consideration the supplemental agreement dated 3 Dec 2008 which determined the reference period for the following months of claim under s 10 (2) (b) SOPA and SOPA Reg. 5. The Court of Appeal held that the effective date was the date of the supplemental agreement and the last date for the claimant to serve the payment for works carried out in April 2010 was 3 June 2010 and not 31 May 2010 as held by the Learned Judge. Consequently, since on the facts C had served the payment claim on 2 June 2010, the claim was served within time and valid.

b. The Court of Appeal interpreted s 10 (2) (b) SOPA and

reg. 5 and held that these provisions did not impose any obligation on the claimant to make monthly claims by the last day of each month following the month and therefore there was no limitation period imposed by s 10 (2) SOPA and reg. 5 as held by the Learned Judge. The Court of Appeal held that 10 (2) (b) SOPA did not compel a claimant to make monthly payment claims for work done in the previous month, whether he wants to or not56. It therefore follows that in Singapore there is no definite period within which a claimant must make a monthly payment claim and a claimant can refrain from making a prompt payment claim for works carried out and commence an application under the SOPA long after the contract is completed57.

Section 10 (2) (b) & SOPA Reg 5 was clearly intended to provide a statutory time-line for the service of the payment claim when the construction contract failed to specify the same. However, the decision of the Singapore Court of Appeal in Chua Say Eng renders the statutory time-lime for the service of the payment claim otiose for there is no compulsion on the claimant to make monthly claims. The claimant is allowed to serve a payment claim for previous claims long after the works are carried out - so long it is within the Limitation period.

Unlike s 10 (2) (b) & Reg 5 SOPA, s 5 (1) CIPAA does not seek to impose any statutory limitation period and delegates the date of service of the payment claim to the parties under the construction contract. Section 5 [1] CIPAA expressly stipulates that the service of the payment claim shall be pursuant to a construction contract and under section 5 [2] CIPAA the payment claim shall include the due date for the payment claimed.58 However, the provision under s 5(1) CIPAA begs the question: what if there was no due date for the service of the payment claim provided under the construction contract? There is a clear lacuna in the CIPAA in this regard bearing in mind that most construction contracts under which sub-contractors are engaged [at least in Singapore] are not Standard Form Contracts and may not contain the due dates for service of payment claims. The Regulations under the CIPAA also do not provide for any specific time-frame for the service of the payment claim [as stipulated by Reg 5 SOPA]. In fact, it is respectfully submitted that any attempt to resolve this lacuna will require an express amendment to the CIPAA and inclusion in s 5 CIPAA for the Rules to prescribe such time-line [as in the case of S 10[2] (b) SOPA and SOPA Reg 5] for it is questionable whether the Regulations under CIPAA could impose any such limitation when the parent Act [s 5 CIPAA] does not provide as in the case of s 10[2] (b) SOPA] any such limitation period. It is further respectfully submitted that there is an urgent need to amend CIPAA to stipulate a prescribed time-line for the Claimant to serve the payment claim if the construction contract does not contain such specific time-frame failing which claimants will be in the dilemma when to serve the payment claim under the CIPAA. The alternative and default position, as

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held by the Singapore Court of Appeal in Chua Say Eng, is that the claimant can serve their payment claim at any time so long as it is within the Limitation period.

[5] Repeat claims clarified Doo Ree Engineering & Trading Pte Ltd v Taisei Corporation overruled.

In the course of its decision, the Singapore Court of Appeal considered the issue of what amounted to a repeat claim prohibited under the SOPA. Section 10 (1) SOPA provided that A claimant may serve one payment claim in respect of a progress payment. (Emphasis mine]

In Doo Ree Engineering & Trading Pte Ltd v Taisei Corporation, the High Court Assistant Registrar held that service of a payment claim which was similar to and/or substantially similar to a non-adjudicated previous payment claim was a repeat claim prohibited under the SOPA. The Court of Appeal in Chua Say Eng reviewed and overruled Doo Ree Engineering59 The Court of Appeal interpreted ss 10 (1) & 10(4) SOPA and defined a repeat claim as a subsequent payment claim for amounts already previously adjudicated upon under the SOPA. The Court of Appeal held that the SOPA only prohibited a claimant from serving a payment claim which was the same and/or substantially the same as one which was previously adjudicated. The Court of Appeal held that the SOPA did not prohibit a claimant from including in a payment claim under SOPA claims for unpaid or partially paid amounts contained in previous claims, provided the previous claims were not adjudicated under the SOPA and inclusion of such unpaid or partially unpaid did not amount to repeat claim.60 The provisions of ss 10 (1) & 10(4) SOPA are materially different from that contained in section 5 CIPAA. In particular, CIPAA does not have the rolled-up provision as contained in section 10(4) SOPA, which was instrumental to the Singapore Court of Appeals holding that the claimant was not prohibited from including in a payment claim unpaid and partially unpaid amounts contained in previous payment claims.

Section 5 [1] CIPAA however, does provide that an unpaid party may serve a payment claim on the non-paying party for payment pursuant to a construction contract unlike the clearer provision under section 10 [1] SOPA which provides that A claimant may serve one payment

claim in respect of a progress payment...61 [Emphasis mine]. The situation under section 5 CIPAA begs two questions: [a] Is the claimant limited to serve one [1] payment claim for a period for works for which it is due under the construction contract and [b] Can the claimant make a rolled-up claim in and/or consisting of an adjudicated amount?

With respect to first question, it is submitted that even though CIPAA does not contain the clear prohibition contained in s.13 (5) SOP [NSW] and/or s 10[1] SOPA, the reference to the claimants right under section 5(1) CIPAA to serve a payment claim limits the claimant to only one payment claim for work carried out for each reference period [or progress claim] under the construction contract. This interpretation accords with the principles applied under the SOPA and SOP [NSW] prohibiting a claimant from issuing more than one payment claim for each period of work done and avoids repeat claims that would be tantamount to an abuse of the CIPAA62.

With respect to the second question, it is respectfully submitted that even though CIPAA does not contain any express provision allowing roll-up claims as in the case of s. 10(4) SOPA and s.13 (6) SOP [NSW], CIPAA does not prohibit the claimant from making a rolled-up claim against the respondent, including claims not previously paid or partially paid. In fact, support for CIPAA allowing a rolled-up claim [despite section 5] is contained in the definition of unpaid party [s.4 CIPAA] which is defined as a party who claims payment of a sum which has not been paid in whole or in part under a construction contract. [Emphasis added]. Nevertheless, the definition of a repeat claim by the Singapore Court of Appeal in Chua Say Eng [derived from the NSWCA decision of Dualcorp Pty Ltd v Remo Construction Pty Ltd [2009] NSWCA at [53]), consisting of a claim for a sum previously adjudicated upon amounted to a repeat claim and is prohibited should be applicable under the CIPAA. It is respectfully submitted that for a claimant to make a payment claim under s. 5 CIPAA, either in the form of a rolled-up claim or a new claim consisting of amounts which have already been adjudicated upon clearly amounts to an abuse of the CIPAA and is a repeat claim prohibited by CIPAA.

It is further respectfully submitted that the prudent and proper exercise of discretion will b