74 LAWYER MONTHLY ADR AWARDS 2024 Arbitration Lawyer of the Year MALAYSIA Could you explain the ADR process in Malaysia and how it integrates within the broader legal system? In Malaysia, the Alternative Dispute Resolution (“ADR”) process is an integral component of the broader legal system, designed to offer efficient and harmonious methods for resolving disputes outside of traditional court proceedings. Historically, Malaysia’s ADR methods were influenced by the cultural practices of its major ethnic groups - Malays, Chinese, and Indians. The formal introduction of ADR in the 19th century drew on models from the US, UK, and Australia, but these foreign methods initially lacked alignment with local traditions, leading to limited recognition. Following Malaysia’s independence in 1957, the country developed its own legal system that blends common law with local statutes. Within this complex legal framework, ADR processes such as arbitration, mediation, and conciliation offer alternative routes for dispute resolution. Arbitration involves a neutral arbitrator making binding decisions, while mediation and conciliation focus on facilitating negotiations and maintaining relationships between parties. These ADR methods are supported by institutions like the Asian International Arbitration Centre (AIAC) and the Malaysian Mediation Centre (MMC), which promote their use in both international trade and domestic conflicts. The integration of ADR within Malaysia’s legal system enhances the efficiency of dispute resolution by providing less formal and more flexible alternatives to litigation. This approach aligns with Malaysia’s broader legal strategy, which also includes specialized tribunals for industrial relations, competition law, income tax and customs law, reflecting a comprehensive commitment to addressing disputes effectively and equitably. How has Malaysia’s legal framework adapted to accommodate and promote ADR methods in recent years? Malaysia’s legal framework has undergone several adaptations and enhancements to accommodate and promote ADR methods in recent years. (a) Legislative Developments Several pieces of legislation have been enacted and bring into force to accommodate and promote ADR, including but not limited to, Arbitration Act 2005 (Revised 2011, 2018 and 2024) and Mediation Act 2012. (b) Institutional Support The AIAC has expanded its services to include comprehensive ADR options, including arbitration, mediation, and adjudication. (c) Judicial Initiatives The judiciary has issued practice directions encouraging or mandating mediation in certain cases, particularly in civil and commercial disputes. Furthermore, Mediation centres have been established within court premises to facilitate the process. In the premises, Malaysia’s legal framework has adapted significantly to accommodate and promote ADR methods. Legislative amendments, judicial initiatives and institutional support have collectively contributed to a robust and evolving ADR environment in Malaysia. These efforts aim to provide efficient, cost-effective, and amicable dispute resolution alternatives, complementing the traditional litigation process. Can you describe a landmark ADR case handled by Steven Thiru & Sudhar Partnership that had significant implications for the practice in Malaysia? The Firm recently acted for the Employer in Damai City Sdn Bhd v. MCC Overseas (M) Sdn Bhd & 2 Ors [2023] 1 MLJ 258, where the rights and interests in a performance bond had been assigned to the guarantor banks. Following a demand on the performance bond, the Contractor applied for an interim injunction in the High Court to restrain the payment and/or the receipt of payment of the guaranteed sum under the performance bond on the ground of Q Q Q
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