Q1. Can the unpaid party initiate CIPAA proceeding if the relevant contract was signed before CIPAA came into enforcement?
Answer: CIPAA applies to a Payment Dispute which arose under a construction contract on or after 15.4.2014. Hence, CIPAA applies prospectively and cannot be applied to contract that was signed before the enforcement of CIPAA. (Bauer v Jack In Pile: CIVIL APPEAL NO: B-02(C)(A)-1187-06/2017 referred)
Q2. Can the unpaid party initiate CIPAA proceeding if there is no signed contract between the parties?
Answer: Definition of Construction Contract In Writing (AIAC Circular no. 3 dated 28.04.2014)
(I) There is a contract in writing:-
(a) if the contract is made in writing (whether or not it is signed by the parties);
(b) if the contract is made by exchange of communications in writing; or
(c) if the contract is evidenced in writing.
As long as there is a Construction Contract In Writing as defined by AIAC Circular no. 3, the unpaid party can initiate CIPAA proceeding.
Q3. What if the Non-Paying Party ignored the Payment and Adjudication claim serves to them?
Answer: A non-paying party who fails to respond to a Payment Claim is deemed to have disputed the entire claim S6(4), and the claimant may proceed with the adjudication after the expiry of the time if the Respondent fails to serve adjudication response S10(3).
Q4. How do I enforce an adjudication decision?
a) Party who obtained the adjudication decision in his favour may make a written request for payment of the adjudicated amount directly from the respondent or principal of the party against whom the adjudication decision was made (S30).
b) Apply adjudication decision as High court judgment or order (S28). The enforcement via the High Court including writ of seizure and sale, winding-up proceeding, debtor summons and likely garnishee order, is available by the winning unpaid party to enforce the decision obtained at adjudication.
Q5. What is the Fees & Expenses and who pay for the adjudication process?
a) Registration of Adjudication Fees is RM250 + SST.
b) Appoint adjudicator by AIAC is RM400 + SST.
c) Adjudicator’s fees and expenses based on the AIAC Standard fees (about 1 to 3% of the disputed amount)
d) Party to party fees (Claim Consultant / Advisor)
e) S18 (1) Costs follow event (Loser Party pays the fees – all of (a), (b) & (c) and partial or full amount of (d) as directed by the adjudicator)