Econpile Holdings Berhad has informed that its has received an RM89 million notice of claim by the SUKE highway contractor Gabungan Strategij Sdn Bhd GSSB for what it deemed as unlawful termination of the contract by the group and its partner China Communication Construction.
The Notice of Termination of Sub-Contract was for the Execution and Completion of Foundation, Substructures and Other Ancillary Works, Package CA3 of Projek Penswastaan Lebuhraya Bertingkat Sungai Besi-Ulu Kelang. GBSSB had awarded the contract back in 2016 to CCCC and EMSB for the sum of RM389 million. Both CCCC and EMSB formed a jv company to undertake the construction work with each defining each party’s roles, responsibilities and scope of work for the purpose of the Sub-Contract, with CCCC taking the leading role.
On 7 January 2022, CCCC issued a Notice of Termination to GSSB for, amongst others, GSSB’s fundamental breach and/or refusal to perform their fundamental obligations under the Sub Contract. On 12 January 2022, GSSB has responded to the Notice of Termination, accepting the Termination and reserved their rights, amongst others, to damages.
CCCC and EMSB then submitted the final claim for the work done under the Sub-Contract amounting to RM485.9 million with balance due amounting to RM143.3 million and requested payment.
Econpile said GSSB is now alleging that it has suffered loss and damage by reason of the wrongful termination of the Sub-contract and has served a notice of arbitration seeking, amongst other reliefs, damages.
