The company, however, succeeded in getting the court to issue an Erinford injunction pending an appeal to the Court of Appeal against the decision.
The Erinford order, made by Justice Lim Chong Fong to maintain the status quo, will be valid until June 24, when it will automatically expire unless extended by the Court of Appeal.
It followed Lim’s refusal to prevent the government from terminating a RM4.475 billion contract for track maintenance previously awarded to Dhaya Maju-LTAT.
The suit, commenced by Dhaya Maju-LTAT in October last year, seeks to declare the termination illegal, unlawful and a violation of a settlement agreement previously entered into with the government.
Also named in the suit were transport minister Wee Ka Siong, consultant company Opus Consultants and Keretapi Tanah Melayu Bhd (KTMB).
Lim had on April 30 heard arguments by Khoo Guan Huat, acting for Dhaya-Maju LTAT, and senior federal counsel Asliza Ali, who appeared for Wee and the government, on the applicability of Section 29 of the Government Proceedings Act 1956 (Act 356).
Section 29 stipulates that no injunction may be issued against the government and public servants for carrying out their duties.
Reacting to the decision, Dhaya Maju-LTAT’s CEO, Mohamed Razeek Hussain, accepted that the argument against the application of Section 29 was “daunting” and the outcome was, therefore, “not unexpected”.
“We know that this may be an uphill battle, but we strongly believe in our right to defend the sanctity of the contract which the government has entered into,” he said.
Razeek explained that Dhaya Maju-LTAT had diligently performed its obligations since it was awarded the contract two years ago and that the attempt by the government to terminate it was unfair and untimely.
“Any new tender for a project this large may take a few years before a new contractor can commence works,” he said.
It is in the public’s interest that the project continues expeditiously, he said, and bearing this in mind, his company remains willing to negotiate a settlement which will allow them to complete the project on mutually acceptable terms.
“We are waiting for the government’s decision on this, which we believe is forthcoming,” he said.