Ingenieur Vol.70 Apr-June 2017 ingenieur Apr-June 2017-FA | Page 74

INGENIEUR ADJUDICATING PAYMENT DISPUTES UNDER CIPAA 2012: THE ESSENTIAL STEPS IN PRACTICE By Ir. Harbans Singh K.S P.E, C.Eng, C.Arb, Advocate & Solicitor (Non-practising) T he Construction Industry Payment and Adjudication Act 2012 (Act 746) (CIPAA) together with its Regulations (CIPAA Regulations 2014) as well as the Exemption Order (CIPAA Exemption Order 2014) came into operation on April 15, 2014. CIPAA has been subsequently held by the High Court and the Court of Appeal to apply retrospectively as well as prospectively. The Act covers “payment” disputes in the construction industry for all construction contracts (inclusive of consultancy contracts) made in writing for construction work done either wholly, or partly in Malaysia both for the private as well as the public sector subject to stipulated exemptions and non-applications. To date the appointing authority under the Act i.e. the Kuala Lumpur Regional Centre for Arbitration (KLRCA) has reported an exponential increase in the number of payment disputes being referred and adjudicated with a very high success rate in favour of “unpaid parties”. This short article is not a legal treatise nor an attempt to delve deeper into the legalities or intricacies of the Act but merely deals with the basic steps that a practitioner needs to be aware of when prosecuting, or defending a typical payment claim under CIPAA. Since CIPAA encourages and in fact by way of some of its relevant provisions e.g. Section 8(3), stipulates “lay” participation at all stages of the adjudication process, the KLRCA has developed and published some standard Templates, or Forms which are available in the public domain and which can be used as a sample by practitioners at almost all stages of the adjudication process. The 6 72 VOL 2017 VOL 70 55 APRIL-JUNE JUNE 2013 Forms are contained in Schedule 1 of the KLRCA Adjudication Rules & Procedures (Rev. 14 May 2014). There are sixteen Forms in total and are at the moment in English and Bahasa Malaysia, although the Mandarin version is in the process of being drafted. The said Forms can be downloaded from the KLRCA’s website at www.klrca.org and can be modified as necessary by the parties to suit their particular needs and/or circumstances of their case. In view of these Forms being mere samples and intended to be used for guidance purposes only, the parties should use them with care and should seek proper legal advice as necessary since KLRCA does not admit any liability for the correctness or suitability of the same. Be that as it may, the basic steps in the adjudication process and the relevant Forms that may be employed in each instance are listed below in brief. STEP 1: PREMINARY REQUIREMENTS ● ● ● ● Is Section 2 CIPAA satisfied? > > Is the construction contract “in writing”? > > Does it relate to construction work carried out “wholly or partly in Malaysia”? Is it not applicable/exempted under CIPAA? > > Does it fall under the Non-applications in Section 3? > > Does it fall under the Exemption Order 2014?