Asian International Arbitration Centre is not immune from Judicial Review when acting as the Adjudication Authority
Case Updates

In the recently released grounds of judgment dated 26 September 2023, the Court of Appeal unanimously ruled that when acting as the construction industry adjudication authority under the Construction Industry Payment and Adjudication Act 2012 (“CIPAA 2012”), Asian International Arbitration Centre (“AIAC”) is not immune from judicial review.

Background

Judicial Review was commenced by One Amerin Residence Sdn Bhd (“One Amerin”) in the High Court to challenge inter-alia (a) the appointment of an adjudicator by AIAC; (b) the legality of the AIAC Adjudication Rules & Procedure; and (c) the imposition of administrative fees purportedly under CIPAA 2012 by AIAC. These acts and decisions were made AIAC in its capacity as the statutory adjudication authority.

By way of an interlocutory application, AIAC raised the plea of immunity and asserted immunity under paragraph 1 of the 1st Schedule to the International Organization (Privileges & Immunities) Act 1992 :

  1. Immunity of the organization, and of the property and assets of, or in the custody of, or administered by, the organization, from suit and from other legal process.

AIAC also asserted immunity based on section 34(1) of CIPAA 2012, which provides :

Immunity of adjudicator and AIAC

34(1) No action or suit shall be instituted or maintained in any court against an adjudicator or the AIAC or its officers for any act or omission done in good faith in the performance of his or its functions under this Act.

On 25 April 2019, the High Court allowed the application and removed AIAC as party to the Judicial Review. Dissatisfied with the decision of the High Court, One Amerin appealed to the Court of Appeal. The appeal was argued before Datuk Abdul Karim bin Abdul Jalil FCJ, Dato’ Haji 2 Ghazali bin Haji Cha JCA and Datuk Supang Lian JCA on 6 September 2021.

The Decision of the Court of Appeal

On 25 January 2022, the Court of Appeal allowed One Amerin’s appeal and overturned the High Court’s decision. In the written grounds of judgment released on 26 September 2023, the Court of Appeal agreed with the counsel for One Amerin and held as follows.

First, the immunities under the 1 st Schedule to the International Organization (Privileges & Immunities) Act 1992 are not applicable to Judicial Review that seeks to question acts and decisions made by AIAC in its capacity as the statutory adjudication authority under CIPAA 2012.

The Court of Appeal referred to section 11(5) of the International Organization (Privileges & Immunities) Act 1992 stipulating that immunities conferred under the Act shall not be greater in extent than those which are or are required to be conferred on the organisation “in order to give effect to any international agreement”, and noted that the Judicial Review does not question the functions of AIAC as an international arbitration centre that promotes and facilitates arbitration. The Court of Appeal further held that immunities conferred upon AIAC are not absolute but are confined to acts done in execution of its functions mandated under international agreement.

Secondly, the words “action or suit” in section 34(1) of CIPAA 2012 do not include a judicial review; and the immunity under section 34(1) is not absolute given the good faith qualification in the provision.

Significance of the Decision

This case highlights the expanding role of an international organization in the administration of domestic law and how the courts have addressed the scope of judicial scrutiny over an international organization with domestic statutory role.

This decision endorses the doctrine of restrictive and functional immunity in the context of an international organisation with domestic statutory role. When purporting to act as the statutory adjudication authority under CIPAA 2012, AIAC is not performing its functions mandated under any international agreement or as an international organisation and is not 3 immune from judicial review.

The administration of CIPAA 2012 by AIAC is thus amenable to judicial review. This decision is consistent with the rule of law in that every public / statutory authority is subject to the supervisory jurisdiction of the High Court through judicial review.