KUALA LUMPUR (March 11): Protasco Bhd has filed a legal suit against its former sub-contractor Kuasatek (M) Sdn Bhd for an alleged breach of contract.
Its claims include a full refund of RM2.96 million that Protasco’s unit HCM Engineering Sdn Bhd had been ordered to pay to Kuasatek, after an adjudication decision in July 2018.
According to a stock exchange filing, HCM filed the suit at the High Court today, alleging a breach of contract by Kuasatek, pursuant to a March 2016 letter of appointment for mechanical and electrical (M&E) works packages.
The work package had previously been awarded to HCM, with Kuasatek appointed the M&E works sub-contractor, for the construction of a four-storey office building with basement car parks at Bukit Jalil, Kuala Lumpur. The office building was for the Asian Football Confederation (AFC), the governing body of Asian football.
Protasco’s claims include a declaration that the contract dated May 13, 2016 is for the sum of RM9.5 million and that Kuasatek had breached the contract.
It is also seeking RM288,205 as costs to rectify the defective works; RM930,000 as liquid ascertained damages; RM12,889 to be paid by Kuasatek to HCM; and RM930,000 to be withheld by HCM as the performance bond until the issuance of the certificate of making good defects by AFC.
Protasco is also demanding for Kuasatek to refund RM106,572 being the sum paid for legal costs, adjudication costs and expenses, as well as general damages and interest at a rate of 5% per annum.
“Protasco wishes to state that the legal proceeding it has initiated has no significant immediate adverse impact on the current financial position of the group,” it said.
Shares of Protasco closed down 0.5 sen at 24 sen today, leaving the group with a RM121.37 million market capitalisation.