Zelan Berhad (“Company”) would like to announce that its wholly-owned subsidiary, Zelan Construction Sdn Bhd (“the Claimant”) has initiated arbitration proceedings against NRY Architects Sdn Bhd (“the Respondent”) on 8 March 2019 in respect of the disputes and differences arising between the Claimant and the Respondent in relation to a project known as Cadangan Pembangunan Pusat Asasi Universiti Islam Antarabangsa Malaysia (“IIUM”) Di Mukim Hulu Lepar, Daerah Kuantan, Pahang Darul Makmur Fasa 3 – Bangunan-Bangunan Akademik Dan Kolej-Kolej Kediaman (“Project”). 

The Claimant claims against the Respondent is premised on breach of contract by the Respondent under the Consultancy Services Agreement dated 9 May 2013 (“Contract”) entered into between the Claimant and the Respondent. The Claimant, inter alia, seeks the following reliefs as against the Respondent:-

(a) declaration that the Respondent has breached the Contract by failing to carry out its obligation under the Contract;

(b) payment for the refund on value of cost savings for Deviation Items amounting to RM5,969,352.20 that results from the breaches committed by the Respondent;

(c) payment for IIUM claims for rental of temporary facilities, utilities bills and other costs from January 2016 until 30 June 2018 amounting to RM38,307,666.66 that results from the breaches committed by the Respondent;

(d) payment for the Claimant’s loss of income from January 2016 until 30 June 2018 arising from availability charges, asset management services charges and compounding interest charges from the financial institution amounting to RM261,121,652.12 that results from the breaches committed by the Respondent;

(e) general damages to be assessed or such a sum deemed reasonable by the Tribunal;

(f) liquidated damages or such a sum assessed by the Tribunal;

(g) all costs of this arbitration, including pre-Award interest and to reimburse all the arbitration and legal costs incurred by the Claimant on a full indemnity basis; and

(h) any other further directions, order and/or other reliefs that Tribunal deems appropriate.

Notwithstanding the above, pursuant to clause 28.2 of the said Contract, both parties have 90 days from the date of the said initiation of arbitration to settle the disputes and differences amicably. 

This Announcement is dated 11 March 2019.