SHAH ALAM (Dec 17): MTD-ACPI Engineering Bhd had failed to sign the deed on a mutual termination of its subcontract with Gerbang Perdana Sdn Bhd as it was allegedly trying to "take advantage" and seek a larger claim from works conducted on the controversial 'crooked bridge' project, the Shah Alam High Court heard today.

MTD-ACPI, IC&E Group Sdn Bhd and Gerbang Perdana had initially agreed to a mutual termination of its subcontract for piling, underground, pillars and related works on the Malaysia-Singapore Integrated Gateway project (which involved the bridge project) after meetings between top representatives of the three companies were held on Feb 10 and 13, 2006.

The termination of the subcontract was effective on Feb 15, 2006.

MTD-ACPI and IC&E Group had entered into a joint venture (JV) called ACPI-IC&E JV to conduct subcontract construction work for the project.

While reading her witness statement, Gerbang Perdana general manager Nurul Huda Hashim said the subcontractor was "trying its luck" to make larger claims for its work as the mutual termination of the subcontract was just two months earlier than the government's issued order for the bridge project to be scrapped.

"This opportunity to twist the argument was made possible because the date of the termination of the bridge project, issued in a letter dated April 12, 2006, was close to the mutual agreement to terminate the subcontract on Feb 15, 2006," she said.

She also claimed that Gerbang Perdana had found that MTD-ACPI did not qualify for any payments as test reports on fulfilment of structural and engineering specifications for a majority of the precast moulds produced by the company for the project was not submitted to Gerbang Perdana.

Nurul Huda also revealed that upon agreement to mutually terminate the subcontract, terms were put forth by Gerbang Perdana to the subcontractor.

The terms were:– joint valuation of all work conducted and materials delivered,
– ACPI and IC&E Group to complete its work under new separate subcontracts,
– valuation of preliminaries and work done, including exchange of new performance bonds and retention sum to be worked out,
– IC&E Group to pay Gerbang Perdana RM3 million for incurring additional costs as Gerbang Perdana had to take over some scope of the works. The amount will be deducted from the retaining sum held by Gerbang Perdana, and;
– no claims whatsoever to be made in the final settlement of contract between parties including any antecedents pertaining to the subcontract.

She said upon correspondence between all three parties, the subcontractor was in the midst of adhering to the terms when the government terminated the bridge project.

Nurul Huda said Gerbang Perdana then received an email from MTD-ACPI noting that since the government had terminated the bridge project, it rendered certain figures and conclusion of terms under the mutual termination of the subcontract "redundant."

However, Nurul Huda said Gerbang Perdana was "taken by surprise" by the government's decision and had sought confirmation.

Therefore, she said a stop work order to the subcontractor was issued on April 14, 2006 and a second letter dated April 18, 2006 was delivered to the subcontractor, calling for a stop to fabrication of precast moulds.

A final letter dated May 5, 2006 was delivered to the subcontractor noting that the project was terminated by the government.

She also said Gerbang Perdana found that MTD-ACPI did not qualify for any payments as tests confirming fulfilment of structural and engineering specifications on a majority of the precast moulds produced by the company for the project was not conducted.

Yesterday, The Edge Financial Daily had reported Nurul Huda as saying that the subcontractor had "misled" Gerbang Perdana on its work progress when its production rate of moulds did not meet critical deadlines.

Gerbang Perdana had taken the subcontractor to court over its right to claims for compensation after the project was terminated by the government, of which the latter's was denied by Gerbang Perdana.

Judge Datuk Azimah Omar is presiding over the case. Hearing resumes on Feb 23.