DB LECTURE 8

PART 1: THE ‘CONTRACT PERIOD’

Contract Period:
• Commencement Date establishes the contractual timeline ... the start of the
Contract Period within which the Works are to be completed ...
• and Site Possession is an actual event where, as a fact, the Contractor takes over
possession of the Site (and takes on responsibility for it) ...
• SIA Contract ties the two together through the provision that:
• Cl. 10: the Contractor shall be entitled on the Contractual Commencement Date to
free and uninterrupted possession of the whole of the area of the Site.
(even the presence of a tree has to be claimed)

• Note: The 9th Edn's “Contract Period” is simply the ‘contractual’ period within which the
Works must be commenced, carried out and completed.
• SIA BC 2016 now calls it: "Construction Period"
• It is NOT the period of ‘existence’ or ‘operation’ of the Contract per se.
• The Contract per se is made (starts) upon the Mutual Assent, ie agreement of the Parties (usually by a
communicated acceptance of offer)—unless the agreement includes a condition of ‘subject to contract’ (eg a
formal requirement of execution under signature).
• LOA can either effect the agreement, or record a prior agreement.
• The contract will start to ‘operate’ automatically upon the contract being made, unless there is a condition-
precedent.

See Clause 10:

the Contract Period and Date for Completion … shall respectively
commence upon and be calculated from [the Contract Commencement
Date].
See Clause 4(2): Approval of Programme does not change the Contractor’s
obligations in relation to the contractual Date of Completion

... Commencement Date:

is typically:
• A particular Date stated in the Tender Documents, or
• By formula set-out in the Tender Documents and LOA
» eg, ‘particular date, or issuance of Permit, whichever later ’ type of clause.

... Mobilisation Period:

• Not contractual provision, but common in practice.
» Period for Contractor to arrange the following, as necessary before physical works can
be allowed to commence: (2 weeks/>, set up things like drainage, hoarding,etc.)
• Permit to carry out structural works
• MOM worksite registration / factory permit
• Insurances (and Performance Bond, if applicable)
• Set-up the Site
» Typically a period allowed before Contractual Commencement Date takes effect, as this
exercise is not entirely within the Contractor’s control.
» Some projects will consider / allow some time for mobilisation-type activities, but
contained within the Contract Period.
Include in Letter of Acceptance – mobilisation period “_ to _”, construction period “_ to _”
But in some govt. constructions, all included in construction period, no mobilisation period.
Note on Programme and Make-up of Prices:
A period for ‘mobilisation’ – between the LOA and the start of work -- also correlates to
contractual provisions:
Clause 4(1) and 5(3) and 8(2) respectively require that the Contractor will not be permitted
to commence work until 14 days after submission of;
» a sufficiently detailed programme
» a sufficient breakdown of prices
» a setting out and levelling proposal
This is notwithstanding the passing of the stipulated Contract Commencement Date,
and no extension of time shall be given in respect of any delay so caused.
PART 2: COMPLETION, HANDOVER, T.O.P
What is the obligation of the Contractor?
Clause 22(1) requires that the Contractor “shall
complete the Works on or before the Date of
Completion” [as stated in the Appendix]

Similarly, Article 1 (“Contractor’s Obligations”)

expresses that, as core to the contract, the
Contractor agrees “to carry out, bring to
completion, and maintain for the Employer the
building …”
Further, Clause 1(1) reiterates that the
Contractor “shall at all times carry out, bring
to completion, and maintain the Works ... in
accordance with the Contract …”

Clause 3(1) provides that the design and/or

specification of the Works will be provided on
behalf of the Employer and the Contractor’s
responsibility “ shall be limited to bringing the
Works to full and satisfactory completion…”

Clause 21 requires that “the Contractor shall

proceed with the Works diligently and with due
expedition at all times until completion.”

So when, why and how does the Architect

certify completion?
Clause 22(2) provides that a ‘Completion
Certificate’ shall be issued by the Architect
when “the Works appear to be complete and to
comply with the Contract in all respects.”

What ‘Works’ does the Contractor need to

complete?
» Note: Article 1 defines “Works” through
stating the Contractor’s obligations -
“The Contractor hereby agrees with the
Employer to carry out, bring to completion, and
maintain for the Employer the building and other
works … [as described] … (which together with
such variations as may be required by the
Architect and all temporary works needed
satisfactorily to construct the permanent works,
are hereinafter called “the Works”)…”
Clause 22(5) further provides that
… if any minor works are outstanding which can be
completed
(A) following the removal of the Contractor’s site
organisation and all major plant or equipment, and
(B) without unreasonable disturbance of the
Employer’s full enjoyment and occupation of the
property,
... then the Architect may issue a Completion
Certificate, which shall record such outstanding
work by way of a schedule attached to the
certificate.
We generally refer to this as "minor outstanding work". (PRACTICAL COMPLETION)

What should the 'schedule' attached to the

Completion Certificate contain?
1. Record any 'minor outstanding work'
2. Terms of agreement for their completion
3. Including terms for withholding and releasing retention
monies (see 31(9) – although in any case, work should
not be paid for until it is completed).
Consider:
- Dates for completion
- Scheduling & access arrangements to do work when the building
is occupied / in use (and any special care / arrangements /
considerations / restrictions)

Note: in other forms of building contracts the

following terms might be used:
• 'Practical' Completion
• 'Substantial' Completion [e.g. PSSCOC]
These terms generally mean the same as certified
'completion' under the SIA form:
The Works are complete/finished/done and comply with
the contract in all respects, save for minor outstanding
works that would not compromise safe and enjoyable
use and enjoyment (occupancy) of the building!

• Note that Clause 3(6) ….

… does not just give definition that “‘completion’ shall mean the
completion certified by the Architect in his Completion
Certificate under Clause 22(2)…” – [when “the Works appear to
be complete and to comply with the Contract in all respects”],
but also …
… elaborates that completion shall also mean
the “subsequent completion and acceptance”
of “outstanding work” under Clause 24(5).

What are “minor works?”

#1. Can the works be completed without the use
of “site organisation, and all major plant or
equipment..?”

#2. Do the works avoid causing “unreasonable

disturbance of … full enjoyment and
occupation..?”

What does “site organisation, and all major plant

or equipment..” involve?
Eg:
» Cranes, Scaffolding, Hoists, Lifts, etc
» Site Office, Yards, Hoarding
» Temporary Works and facilities (eg Site Drainage,
ECM, etc)

What does “unreasonable disturbance of … full

enjoyment and occupation..” involve?
1. Rectification / completion activities will not
cause ‘unreasonable disturbance.’
» Consider modes of disturbance, such as;
• noise, dust, privacy, security, access restrictions, etc
• partial and temporary loss of use of a function / facility, etc

» What is ‘reasonable’ disturbance – eg what is‘intolerable’?

Architect to determine / reason!
• Question: Are different developments considered
differently - eg sensitivity to disruption?
– Clean Rooms cf Schools
– Labs cf Residential
– Supermarkets cf Common Areas
• Question: Should availablity of ‘times’ to complete
works be a matter for consideration?
• Question: Should works akin to ‘maintenance’ be
considered minor? *(e.g. painting scaffolding that is same as what would be used every 5
years & not require occupants to move out  can be considered as minor works)

What does “unreasonable disturbance of … full enjoyment

and occupation..” involve?
2. Incomplete/missing works itself, and any
activities of rectification and completion, will
not compromise ‘full enjoyment and
occupation.’
Eg:
» All areas and facilities of the development must be
available for use, at all times.
» Operability of building systems (eg air-conditioning &
ventilation commissioned, water & sanitary)
» Consider what leads to ‘enjoyment’ - ambience,
thermal comfort, lighting levels, functional intent, etc?

Points to note on Completion Certificate and

Minor Outstanding Works:
• “...Works appear to be complete and comply…”
» Expectation of the Architect to do reasonable checks
on completeness and compliance, eg;
• Pre-completion inspections of the Works
• Testing & commissioning reports from Contractor
(eg waterproofing)
• Feedback, reports and inspection records from Site
Supervision Staff (eg Clerk of Works, Resident
Architect, etc)
• Feedback from Quantity Surveyor on % of
compliant work assessed as complete (although
Architect remains responsible to determine
whether any works are deemed ‘non-compliant’)

» May need to check with other consultants on the

status of works under their respective design &
supervision responsibilities, eg;
• M&E Engineer, assisted by M&E Site Supervision
Staff, should feedback to Architect on status of
M&E Systems (eg ACMV, fire-protection, water,
gas, electrical, etc) - typically testing &
commissioning status
• Structural inspection reports in order?
• Other Consultants: Acoustics, Landscaping,
Interior Design, etc

» Employers would assume that proper ‘supervision’ of

the Works has occurred, so the Architect is familiar
with the Works and their status.
• Site Supervision Staff (eg Clerk of Works) - often
referred to as the ‘eyes and ears of the Architect
on Site.’
• Inspection of the Works at appropriate times to
verify compliance (including mockups, samples,
off-site fabrication, etc)
• Review of technical proposal submissions (shop
drawings, method statements)
• Random tests and inspections
• Site Progress Meetings, etc

» Although ‘reasonable’ supervision (including

inspections* through observation, testing &
investigations, etc) would be expected - the Architect
does not 'warrant' that the Works are free of defects
(as the Contractor is primarily responsible & liable for
the Works he builds) so “appears” infers a reasonable
standard of assessment.
• *Note common law position on contract administration in regard
to the required standard of supervision of works: inspection vs
standing / constant supervision.

(architect doesn’t have to be constantly on site, only there for impt duties, ensuring standard of works, verifying
materials, etc. – can hire site supervision staff, etc.)

• What are “… all respects …” of the Contract?

» Consideration should be given to:
• Correctness of work type
• Extent / quantity of work
• Quality / specification of work
• Turn-on / Testing and commissioning of work (ie
verification of operability or performance)
Note that Clause 11(1) sets a quality standard:
… that “all materials, goods and workmanship comprised in the
Works shall … be the best of their described kinds and shall in
all cases be in exact conformity with any contractual
description or specification and of good quality.”

» The scope of “all” of the works comprising the

“Works” -
• Original Contract descriptions
• Variations
– Ordered [see Cl. 12(1), 1(1)],or
– Sanctioned [see Cl. 12(1) and 11(4)], or
– Authorised [see Cl. 12(1)], or
– Deemed [see Cl. 7(2)]

• Are defects considered ‘outstanding’

(incomplete) works?
» FIRSTLY: What are ‘defects’?
• generally taken to mean any non-compliance with
a contractual requirement (eg a required standard
of quality) for a part of the permanent works that is
'done' (ie not omissions),
... c.f. "defects, omission & other faults".
• hence consider 11(1) which is broad and also
involves requirement for conformity the
specifications (in regard to materials/goods and
workmanship).

» It can be argued that ‘patent’ (as distinct to ‘latent’)

defects render those parts of the Works as currently
‘non-compliant’ works under Cl. 11(3), and hence their
removal and replacement is pending - and is therefore
not complete.
» Note: Contractors will often seek patent defects to be
treated as ‘defects to be addressed in the
Maintenance Period' - so their pending rectification
does not hold up issuing the Completion Certificate -
» HOWEVER; the Architect should consider whether
such pending remedy of a ‘patent defect’ can be
considered ‘minor’ outstanding work?

» Also remember that progress payments indicate an

acceptance by the Architect that that part of the
Works does indeed appear to be complete;
» ie progress / interim payment is on account of the full
Contract Sum being paid upon the whole of the Works
being completed,
» and therefore that part of the Works is not ‘rejected’
(which would require payment for that part of the
Works to be withheld),
» ie that part of the Works is complete and complies
with the contract in all respects, therefore that it is
‘apparently’ free of defects.

» Sub-Clause 31(3) provides that, for stage payment,

payment shall be made upon 'completion' of a stage of
work ... assuming complete and comply in all
respects!
» Sub-Clause 31(2) requires that, for periodic payment,
valuation of amounts due for payment shall be of
"work properly carried out" with deduction of "a fair
allowance in respect of any defective or incomplete
work … of which the Architect is aware at the time of
the certificate …"
» Sub-clause 11(3) provides for rejection & replacement
of non-compliant work ... hence replacement is
pending!

Is T.O.P. a criteria for completion?

No, not directly; completion only relates to the
Contract Scope (as defined by the Contract
Documents) but:
» The work and completeness required for T.O.P. needs
to be secured through the Contract, so if ‘extra’ work
is required to comply with T.O.P. requirements, an
Instruction can be given (possibly with an EOT) to
bring the T.O.P. requirements back into the Contract
Scope.
» The Works will therefore generally be 'ready' for T.O.P.
at the time they can be considered ‘complete’ for the
purposes of the Contract.

(but many paper works. Contractor is not in control of bureaucratic control of the TOP
paper work. )  (physical readiness for TOP is ok)

» Note that the Conditions of Contract refers to ‘full

enjoyment and occupation’ - thus incomplete works
cannot be considered ‘minor’ if they would
compromise obtaining T.O.P. - as such incomplete
works would therefore be preventing ‘occupation.’
» Note other similarities and relationships between
T.O.P. and contractual completion:
• T.O.P. also requires that the Contractor has moved
out Plant, Site facilities, scaffolding, hoarding etc
from the Site
• T.O.P. is for ‘occupation’ - similar to ‘enjoyment
and occupation’ sought under the Conditions.

» Also note that: T.O.P. requires application processing

time, inspections, etc by Authorities, which are not
under the control of the Contractor, and are not
grounds for extension of time.
» Consider:
Ser Kim Koi v GTMS Construction Pte Ltd [2016] SGCA 7
Architect 'fraudulently' issued a Completion
Certificate: he could not have genuinely believed the
Works were complete (or recklessly disregarded the
incomplete work)
... including that the T.O.P. inspection had been
rejected, pending rectification of non-conformities.

Why is ‘completion’ important?

• Cl. 24(2)&(4) - Liquidated Damages
» LD can be accrued and recovered by Employer if
Contractor doesn’t complete on time.
• Cl. 19 & 20 - Insurance
» Insurance policy validity (covering Work Site
activities) needs to be extended (at Contractor’s
expense) if Works are not completed on time.
• Cl. 16 - Plant & Equipment
» Remain the Employer’s property and may not be
removed from Site (unless Architect’s consent is
given) until completion.

• Cl. 16 - Materials & Goods

» Remain the Employer’s property and may not be
removed from Site until completion, including any
surplus quantities.
• Cl. 31(3) - Milestone Instalments
» Interim Payment in line with completion of respective
milestones.

• Cl. 31(7) - First Release of Retention Monies

» One half of the Retention Monies shall be certified as
due for payment to Contractor upon certified
completion.
• Cl. 27 - Maintenance, and Cl. 31 - Final
Payments
» The Maintenance Period shall commence upon the
issuance of the Completion Certificate.
» 2nd release of Retention Monies and Final Payments
timelines therefore follow-on from certified
completion.

NOTE:
• As Completion is important … it is important
that the Contractor is given the full period of
time and full access to achieve completion …
• Hence: Cl. 10 provides that:
1. “The Contractor shall commence Works on the Contract
Commencement date”.
2. “if the date … becomes invalidated … [it] shall be
appropriately modified or re-calculated”.
3. “the Contractor shall be entitled … to free and
uninterrupted possession of the whole of the area of the
Site”.

Date for Completion v. Programme

» Regarding Cl. 4(2), the Guidance Notes advise that the
programme is “primarily concerned with order and
sequence as opposed to actual dates [eg interim
milestones].”
Cl. 4(2) states that “Approval of the programme by the
Architect … shall not otherwise change the
contractual obligations of either party in relation to
the Date of Completion…”
» Therefore, the Contractor is not in default (for delay)
until the contract Date of Completion is exceeded -
NOT for failing to meet desired milestone dates!

» The programme is “primarily concerned with order and

sequence as opposed to actual dates.”
ie no standard requirement for
- critical path network
- milestone events
ie no contentions on ‘who owns the float’
[This is different to the PSSCOC]
[But may be written into Contract Documents]
» Therefore, the Programme may be for:
- verification that the Works are properly planned
- reference as to whether the Contractor is proceeding
with diligence & due expedition (Clause 21)
- general reference in determining EOT

What is ‘handover?’
Handover is typically an event
... after completion
... where the Employer is provided with the
access & items required for occupancy.
Handover is often soon after actually getting TOP
(i.e. so the Employer can 'legally' occupy the
building).

Up to SIA A&CBC 9th edn:

Handover was not included in the standard terms
of contract, but might become contractual by
inclusions in the Contract Documents.
However, in SIA BC 2016: Clause 22(3)&(4)
provide for a "Period for handing / taking over
the Works"
– to be stated in the Completion Certificate.

Principal Contractor’s responsibilities for the

Works (eg the Site) until 'handover':
• Indemnity liability, and insurance coverage
• Safety:
(eg Building Control Act, WSH Act, Fire Safety Act, etc)
• Access Controls & Security
(note Cl. 9 giving access to Architect)
(note Cl. 17 giving access for artists, tradesmen & other contractors)
• Environmental Measures
(eg mosquitos & pests, ECM, noise, etc)

Handover is often ‘progressive’:

1. ‘practical handover’ – for occupancy …
»Keys / Security System & Access Controls
»Building Systems controls
2. ‘cleaning’ & ‘upkeep’
» eg briefing/instructions to cleaning staff
3. ‘maintenance & servicing’
» OMM (operation & maintenance manual) & As-built Drawings (& briefings)
» Collateral Warranties & Servicing Contracts (e.g. landscaping works)
» Suppliers & Materials register

Handover – ‘practical handover’ (where the

Employer is provided with the main items
required for occupancy...
... is important for INSURANCE:
The Employer’s property damage insurance usually only
starts upon handover, whereas the Contractor’s
insurances (CAR and PL) usually relates to “contractual
completion” – thus ‘bridging’ period of construction related
insurance coverage is often specified.

Points to consider in ‘handover:’

» Upon or after contractual completion, but …
» … typically after T.O.P. (allowing actual occupancy)
» The ‘construction-related’ mode of C.A.R. insurance
and Public Indemnity covering the activities of a Work
Site usually ‘stops’ upon the certified date of
completion, but some policies give +14d (or more) to
‘bridge’ the coverage til handover, because …
» … Occupant’s ‘contents’ insurance only starts upon
the time of handover / move-in, and ...
» … Employers desire the Contractor to possess and
remain responsible for the Site / Works until handover
(eg security, maintenance and operating of systems,
environmental and health measures, etc).

Phased / Stage Completion

Clause 25 provides for where the Works involve
different “Phases” or “Stages”
“Phases” / “Stages” are distinguished from general 'phases'
/ 'stages'.
General 'phases'/'stages' involve a stipulated timeframe to
carry-out (or postpone) parts of the Works, and can be as
described in the Contract Documents (eg a phasing plan
or schedule).

“Phases” / “Stages” are a special kind of phase/stage that

are ‘defined’ by provision of :
• being stated and identified in the Appendix
• and are attributed “different Commencement and
Completion Dates” (as stated or determined)
• and have “different and separate liquidated damages”.

What are “Phases” & “Stages” under Cl. 25 ?

1. Phases/Stages generally refer to parts of the Works ...
... definable by virtue that the work can be ‘completed’
(eg area/zone/portion or set/network/system of the permanent Works; temporary work; process
- eg test &/or commissioning; mobilization (?); handover(?); as-built records(?); warranties (?))
2. A ‘milestone’ for payment would constitute a “Stage” under Cl.25 if it is
also provided with its own “Contractual Date for Completion” and
“different and separate liquidated damages”, and is presented as such in
the Appendix
3. There may be various ‘milestones’ (w/o LD) for payment instalments
within a particular “Phase”
4. Hence “Phases” can relate to ‘periodic progress payment’,
or contain ‘milestones’ for payment by instalments.
5. The Construction Period may contain multiple “Phases” / “Stages” or
comprise a single “Phase” / “Stage”, and
6. “Phases” / “Stages” may run sequentially, concurrently or overlapping /
gaps (lead & lag time).

What are “Phases” & “Stages” ?

In comparison, SIA MWC is helpful in explaining a concept
of Phases & Stages (only applicable to the MWC)
... by adopting the following definitions:
• “’Phase’ means that distinct part or area of the Works as
identified in the Appendix, and may form the basis for
interim payments by fixed instalment”.
• “’Stage’ means that stage in the process of construction
as identified in the Appendix to form the basis for interim
payments by fixed instalments”.

(contractually separate)

Why Phases ?
Eg – Where a ‘part’ of the building can be occupied
earlier and thus
(i) operator’s commercial activities,
(ii) developer’s rental or property sales, etc,
can proceed (hence LD relates to loss of rental or sales)
Eg - Supermarket renovation in stages so only part is
closed down at any particular time (ie business
continuity).

Eg - where the various Works parts comprise a multilocation

Site (so late possession / EOT, or imposition of
LD on one Site doesn’t affect the other Sites).
Eg – where part of the building / development Works is
needed earlier (eg to install equipment, where 3 rd-party
supplier will charge storage fees if not delivered directly
to site – ie so that LD can offset the costs incurred if
delayed) ....

... and so that any e.o.t. for a discrete part of the Works
doesn’t give e.o.t. for the whole of the works ...
... Further consider the essential contract requirement that the Contractor is to
always proceed with diligence and due expedition (see Cl. 21) ...
... It is so important that it is also a ground for ‘termination’ (see Cl. 32(3))!!
Also eg see CAA v HP [2015] SGHC 32 ... where progress of work is slow relative to
achieving completion by the [latest] date for completion [incl. e.o.t.] - eg measured
against ‘revised’ programme + key/milestone dates.
... THUS phasing arrangements should promote that ALL parts of the Works are
always needing to be proceeded with diligently and expeditiously – ie realistic
timeframes relative to a good rate of work!
Note: ‘slow’ rate of progress of the work might lead to unnecessary additional
preliminaries costs being incurred by the Employer!

» If a part of the Works needs to be completed earlier

than the rest, it should be defined as a separate Phase
or Stage.
- BUT ... Electrical Sub-Stations need to be handed
over to Powergrid for fit-out ??
… typically not a separate Phase or Stage (although it could be
a ‘stage’ for payment) because a requirement to allow a period
of time for the 3rd party to fit-out and energise the ESS may be
specified as a requirement / obligation of the Works to be
carried out / provided ‘within’ the stipulated timeframe, so is
already covered by the Liquidated Damages provision for that
Contract Period / Phase / Stage that it is ‘within.’

Note: Each Phase or Stage has separate;

» Completion Certificates
» LD
» insurance
» maintenance
» release of Retention Monies
» [but not Final Certificate]
(applied mutatis mutandis as if each Phase or
Stage was the subject of a separate and
distinct contract- see Clause 25)

... as if each Phase or Stage was the subject of a

separate and distinct contract ...
THUS the Phase “commencement date” needs to
be defined:
1. A stipulated date
2. As determined from formula ...
... (based on events)
3. As determined from formula ...
... (based on sequences of precedent Phases, eg upon
handover of the precedent Phase).

Partial Re-occupation
Either:
(a) Cl. 26(1)&(2) - Occupation of Part with consent, or
(b) Cl. 26(3) - Occupation of Part without consent

Differs from Contract / Phase Period:

... Contract / Phase Period is typically stipulated
in tender/contract documents.
whereas ...
... Partial re-occupation occurs as an opportunity
while the Works are being carried out.
... and partial re-occupation applies to Contract /
Phase Period (not in lieu).

Occupation of Part with Consent: Cl. 26(1)&(2)

• If before completion of the Works [and whether
or not the Contractor is in delay] the Employer
with the agreement of the Contractor takes
possession and occupies any part of the Works
» This part of the Works need not be complete (it is the
Employer’s choice to occupy).

» Architect to issue ‘Certificate of Partial Occupation’

• Any agreed terms / arrangements for use,
possession & access
• Valuation of the occupied part
• List of outstanding works
» Proportionate amount of Retention Monies to be
released
» Maintenance Period for the Occupied Part shall
commence upon the date of re-entry (and involves a
separate Maintenance Certificate)
» Value of Works remaining to be insured can be
reduced by the value of the Occupied Part
» Proportionate reduction in LD

Occupation of Part without consent Cl. 26(3)

• If before completion of the whole of the Works
beneficial occupation and use of a part of the
Works by the Employer can be effected without
any unreasonable disturbance of the
Contractor’s arrangements for completing the
remainder of the Works [and only if a Delay
Certificate has been issued, ie the Contractor
has not completed the Works on time] the
Employer may without the consent or
agreement of the Contractor re-enter and
occupy the relevant part of the Works

» Delay Certificate must be operative

» Architect to issue a ‘Certificate of Partial Re-entry’
• Any agreed terms / arrangements for use,
possession & access
• Other provisions as if ‘Certificate of Partial
Occupation’
» Additional payment / compensation if Contractor
incurs additional expenditure as a result of the reentry

Question: Any expectation for the Employer to reenter

so as to mitigate damages?
eg if only a small portion of the Works (that does not constitute
‘minor outstanding work’) remains incomplete at the Date for
Completion, can the Employer insist upon full completion, then
reap his entitlement to Liquidated Damages? Or is there an
expectation / legal obligation to ‘mitigate’ LD by exercising a
discretionary right to partially take possession and occupy part
of the Works?
- this may be a case-by-case matter, as full completion may be
required eg for commercial operations
- a legal question, as the terms of LD (unlike general damages)
are agreed by the parties up-front, so do not need to be
substantiated / proven beyond general reasonableness (eg not
acting as a penalty)

Extending the Date for Completion (EOT)

Clause 23 allows for the Contract Period / date
for Completion to be extended.
» Only if delaying factors are within the grounds set-out
in Sub-clauses 23(2)(a)to(q).
PART 3: MAINTENANCE (DEFECTS LIABILITY) PERIOD
(Clause 27):
27(1): The “Maintenance Period shall commence
upon the issue of a Completion Certificate”.
(or rather, upon the date of completion)
(AND ... remember that Maintenance Certificate is issued for
each Phase / Stage, and for each Occupied Part, if any)

It is my opinion that the MP commences upon the certified date of

completion—consistent with:
» 26(2) provision of MP commencing “upon the ... date of re-entry”.
» 3(6) reference to “completion certified by the Architect” and 24(4)
provision of the “completion as certified in the Completion
Certificate” and the SIA Specimens suggestion that the certification
should state the material Date on which Completion was attained.
» Common sense that Contractor should not be liable for LD for delays
attributable the procedural act of ‘issuing’ the Completion Certificate
late (after the actual time that the Works actually achieved a
completed status).

During a Maintenance Period:

• Contractor is to complete any outstanding
works (ie as listed in the Schedule to the
Completion Certificate)
• Architect may issue directions (or instructions,
if defect is not Contractor's fault) requiring the
Contractor to make good any defects
(inclusive of omissions and other faults) in the
Works.

• SIA form of Contract refers to a “Maintenance Period”

• PSSCOC refers to a ‘Defects Liability Period’
• JCT refers to a ‘Defects Rectification Period’
All similar and generally address the same intents and purposes:
for rectification of Defects in the permanent works.
Note: Some commentators don’t like the term ‘Maintenance’ to describe
the period as it may have (misleading and incorrect) connotations of
involving activities to keep the permanent works in a good condition
and/or a pristine state.
‘Defects Liability’ may be misunderstood to exclude / limit liability
outside of this period (such as liabilities under general law) – which could
be the case, but only if the terms of contract expressly and validly
provide for it to be so.

• Note: defects, omissions, or other faults

includes for the parts of the Works by NSC/S
and DSC/S.
• If the defects, omissions, or other faults in the
Works is not due to the Contractor’s default, an
instruction should be issued as the Contractor
will be entitled to payment to rectify the
defects.
• Eg fault in Architect’s design (not workmanship or
Contractor’s design / selection of materials)
• Eg faults due to Employer’s directly-engaged artists,
tradesmen and contractors

• During the Maintenance Period, the Architect

also may issue AI/AD for:
» Investigation of Defects (same as in Cl. 11(2)
» Reconstruction or replacement of non-compliant
works (same as in Cl. 11(3)
» Vary the works in lieu of reconstruction or
replacement (same as in Cl. 11(4)

Why a Maintenance Period?

Because buildings are one-off projects, there are no
'prototypes' for testing etc ...
... not made in controlled environments such as goods produced in a
factory, so eg not a pure application of ISO9001 quality processes,
which is more 'goods'/'products' production line manufacturing
based ...
(ie less 'controlled' design development, validation and postproduction
quality monitoring/measuring)
(although "pre-fab" & automated "umbrella" methods trying to
address this)

1. Design Development:
Although Architects may have 'standard' specs & details ...
... the 'assembly' of the unique building is 'one-off', 'bespoke'
and 'un-tested‘ (ie without a full-scale 'prototype').
... they are applied by different builders for different
projects.

2. Validation & Quality Monitoring/Measurement:

Although there is usually standard 'testing &
commissioning' protocols applied on particular elements,
materials & systems (to verify 'fitness for occupancy') ...
... only 'patent' defects can be identified, and 'latent'
defects often manifest later (during occupancy).
... and access to some areas of a building is restricted, so
some 'patent defects' might only be discovered later during
maintenance/servicing exercises.

... hence a post-completion period is stipulated within which

such residual defects can be identified
(with contractual provisions to oblige the Contractor to
return to the Works to remedy/rectify defects as they are
discovered).
... and practice/norms have established an expectation for
"substantial" completion to be achieved, ie a condition that
safely allows the Employer to occupy/use the building ASAP,
thus allow minor outstanding works (including works to
rectify defects) during occupancy/use.

POINT_1.
Prevents the Contractor limiting liability for defects:
It is a provision through an expressed term of contract, therefore it
prevents the Contractor from having an ‘exclusion clause’ limiting
or avoiding liability for defects, ie
(i) it sets the allocation of liability and risk, and
(ii) the drafting protects the Employer’s commercial interests (as in
most ‘standard’ forms of building contract).

POINT_2.
For Convenience / benefit of the Employer:
2.(1) If there was no contractual provision, then; defects would
technically be a breach of contract to which Employer would have
to pursue legal rights for remedy (ie an action under breach of
contract), and each defect would need to be dealt with separately either:
(A) For rectifying the defect; either
(i) to order the Contractor to perform the rectification of defect, or
(ii) to recover costs of engaging another contractor to rectify, or.
(B) For diminution of value (ie reduced market value) of the development due
to defects (non-compliant work) that are retained without rectification.z

POINT_3.
‘Protects’ the Contractor by giving a ‘privilege’ to
return to the site to attend to his defective work:
The contractor’s liability does not end at the

The JCT Minor Works form of Contract – David Chappell

POINT_4.
A practical mechanism; allows more economical and
practical arrangements for deployment of resources
to attend to defects, and to have insurance coverage,
etc.
4.(1)_Hence can rectify defects at own (usually lower) costs,
through (1) not being subject to recovery of (higher) costs of other
contractors, (2) Contractor can manage the arrangements /scheme
of rectification (contractors, scheduling, etc) so it can be done
effectively and efficiently.
4.(2)_Hence avoids having to go through lawsuits/ADR for breach of
contract.

POINT_5.
General Considerations:
5. (1)_Efficiency: (1) of Contractor's personnel who are familiar with
the ins-and-outs of the Works, (2) of resources, ie defect
rectification can use retained or left-over equipment and materials,
etc. Both are even more relevant where the Contractor is nearby for
subsequent phases of the Works.
5. (2)_Efficiency of Insurance coverage (rather than individual
insurances by other contractors).

5. (3)_ A definite 'period' for defect rectification obligations allows

surety (eg retention, performance bond, security deposit, etc).
5. (4)_Generally Contractor can defend claims for costs of other
contractors on principles of mitigation: ie where the Contractor had
not been given opportunity to rectify: costs can only be at the level
as if the Contractor had done the rectification work himself. Where
the Contractor failed/refused to rectify a defective work properly;
then at the 'reasonable' cost (eg at established market rates) of
only 'necessary' rectification works.

POINT_6.
Contract Administrator:
6.(1)_Addressing defect rectification thru the Contract promotes the
role of a knowledgeable and impartial Contract Administrator:
6.(2)_ Promote an effective and efficient process.
6.(3)_ Advise on cost issues.

6.(4)_ To understand the technical contractual requirements /

designs, and thus to (1) identify/recognise and declare works that
do not comply, are defective, and (2) advise the Employer on the
extent and nature of rectification works required, so that the
Contractor does not claim for 'extra' costs, and (3) confirm that
rectification works are complete and acceptable (ie that the Works
are brought into full compliance with the Contract requirements) -
which may inform on the release of surety (eg retention,
performance bond, security deposit, etc).

How long is the Maintenance Period?

• Default in Appendix = 6 months
• What considerations?
• Weather ‘seasons’ that may ‘test’ the building and affect defects
becoming manifest / apparent
• Type of ‘operation / use’ of the building for which time may be
required to ‘test’ the performance of the building materials and
systems (eg the fitness for purpose).
• Developer’s obligations for defects rectification under sales &
purchase agreements (eg Housing Developer’s Act)
• Singapore Standard on handover of buildings
• In-house handover processes and procedures
• Size of development relative to resources to inspect the completed
Works

"Schedule of Defects" (Cl. 27(2):

... is not to be confused with general ‘lists’ of defects
issued during the Maintenance Period ...
The Schedule is issued not later than 14d after the expiry of
the Maintenance Period
Lists out all remaining defects, omissions and other
faults
Subsequent AI/AD is required to order making good of
defects recorded in the Schedule

Maintenance Certificate (Clause 27(4):

The Architect shall issue the Maintenance
Certificate once all defects are dealt with, ie:
» made good,** or
» allowance for defect (under 27(3))
**Note: making good includes ‘in lieu’ provisions:
(i) the rights of Employer under 1(6) to employ other
contractors if the Contractor fails to comply with a
direction, such as a direction to make good defects
(ii) allowance for defects under 11(3)

… discharges the Contractor from any further physical

attendance upon the Works for the purpose of making
good defects.
» Note: Maintenance Certificate discharges the Contractor, not
the ‘end’ of the Maintenance Period
» Maintenance Certificate does not “prejudice the rights of the
Employer in regard to defective work, or any other breaches
of contract whether previously or subsequently discovered.”
» Note: compare with the ‘Limitation Act’ which limits a
Contractor’s liability under common (general) law for ‘patent
defects’ to 6 years and ‘latent defects’ to 15 years.

Allowance for Defect (Clause 27(3):

Where the Contractor does not make good a
defect within the stipulated period (84 day
default) immediately following the issuance of
the Schedule of Defects, there shall
mandatorily be an Architect's Direction for a
reduction in the Contract Sum in lieu of making
good (for all such defects remaining
unremedied).

» This allows the maintenance obligations to be closed

out in a determined timeframe (and allows the
Contractor to submit the Final Payment Claim).

Considerations regarding ‘mandatory’ allowance

for Defect under 27(3):
» Is the defect of a nature that it can be left as is and
allowed for by a cost deduction under 27(3)?
» What if it is important to have it fixed (eg watertightness of roof or
façade), such as where a Developer cannot handover a defective
building to the Purchaser / MCST?
» Consider using 1(6) to have another contractor rectify
a defect rather than allowing the defect under 27(3).

» But what if the works are ‘specialised’ or proprietary, so no other

contractor can really repair / rectify or modify those works?
» Therefore, consider together with the risk of Contractor defaulting on
guarantee and/or making good under maintenance obligations when
specifying ‘specialised’ or proprietary building products / systems in
the first place.

» If using 1(6) to have another contractor rectify a

defect rather than allowing the defect to remain
unremedied (with cost deduction) under 27(4) …
» … what of the status of any ‘warranty’ on that part of the works
affected or replaced by the other contractor?
» Therefore the deduction under 1(6) may need to include the cost of a
superseding guarantee from the new contractor?

Liability for Defects - Generally

• The contractor’s liability for breach of contract [eg
defects] is limited by way of the Limitation Act
(eg 6 years)
• Contractor may be liable in tort as well as contract,
although the process is typically more onerous.
PART 4: COLLATERAL WARRANTIES & SERVICE AGREEMENTS

Collateral Warranties
A collateral warranty generally defines an agreement
ancillary [ie operating collaterally] to another principal
contract :
In construction the word “warranty” tends to be referred to as a
separate contract placing a party to an existing contract under
an independent obligation to another person. Such a warranty
may, for example, place an obligation on a sub-contractor to a
land owner or developer. Warranties may be used to protect a
purchaser against latent defects caused by a sub-contractor.
Without such a warranty, the purchaser may not have an action in
contract [as they are not privy to the Contract].
[A collateral warranty will also typically last longer than the DLP
under the Contract].

UK's JCT states:

Collateral warranties are used as a supporting document to a
primary contract where an agreement needs to be put in
place with a third party outside of the primary contract.
Sometimes an architect, contractor, or sub-contractor will need
to warrant to a funder, tenant or purchaser that it has fulfilled its
duties under a building contract.
Collateral warranties often contain obligations that affect the
consultant or contractor, such as using materials of an
appropriate quality, and carrying out work in a professional,
workmanlike manner. It can also provide the third-party
contractual rights enabling it to claim for losses which would
not otherwise be recoverable.

In Singapore, you may come across three names:

• Warranty
• Guarantee
• Indemnity
Although 'warranty' and 'guarantee' have similar etymological roots
(and are thus often used interchangeably); in many modern legal
environments the term 'guarantee' actually refers to a promise to
stand behind the undertaking of another (ie as a 3 rd party
guarantor), while in construction usage most provisions labelled
"guarantee" are in fact promises to stand behind one's own work
and thus are actually "warranties".

In Singapore, Collateral Warranties will often be

referred to as a 'Guarantees'
e.g. in the Unfair Contracts Terms Act, in regard to 'consumer goods'
"anything in writing is a guarantee if it contains or purports to contain
some promise or assurance (however worded or presented) that defects
will be made good by complete or partial replacement, or by repair,
monetary compensation or otherwise"

Note that Collateral Warranties / Guarantees are

not expressly called for under the SIA Conditions,
… but may be required under other Contract
Documents.
In practice, those other Contract Documents may state whether
submission of the further Collateral Warranties / Guarantees documents
is required for issuance of the Completion Certificate (and for payments
for the corresponding works be certified), or whether they can be
considered as ‘minor works.’

• Benefits: (btw employer <-> specialist sub contractor)

- Collateral Warranties’ purpose is to create legal relationships
that would not otherwise exist (or to clarify a relationship
created by implication of law) – eg overcomes issues of ‘privity
of contract’ and exclusions of ‘Contracts (Rights of Third Parties)
Act’ :
…. (i) eg where a Contractor and Sub-Contractor (3rd Party)
execute a Warranty / Guarantee document ‘jointly and severally’
so that the ‘specialist’ Sub-Contractor is brought into the
warranty

…. (ii) eg to execute a Warranty / Guarantee document that can

be 'assigned' / 'transferred' eg from Developer to Purchasers
(who would not otherwise have contractual links to the
Contractor, and therefore could only rely on the relatively more
difficult action in tort as remedy to defects).
(consider the difficulty of claiming in tort for ‘pure economic loss’ – ie the
cost of rectifying a defect, as distinct to claiming for damages for
damage, loss or injury / harm / death to persons or other property caused
by the defective permanent works)

- useful in extending the assurance (liability) beyond the

statutory time limits - ie to overcome the Limitations Act;
… 6 years for patent defects, except extended in some
jurisdictions if warranty is executed under seal (as a deed)
(Statute of warranty is 6 years) ->
overcome that, make it 10 years w collateral warranties.
… 12 years for latent defects
- useful in defining defects (eg based on deficiency in
performance, eg watertightness) to overcome contentions that
the fault is caused by wear & tear, weathering, natural aging and
lifespan of a material, etc.

Also note;
Trebor Bassett Holdings Ltd and The Cadbury UK Partnership v ADT Fire
and Security plc [2012] EWCA Civ 1158
Statutory or Common Law implication of warranty of 'fitness for purpose'
on 'goods' (ie proprietary products sold for a purpose) does not include
'bespoke systems' (ie custom-made systems made-up of goods &
materials, such as under a design & construct arrangement), which are
considered the output of a 'service'.
HENCE, without ‘implied’ warranty of fitness …
… there is need for expressed 'contract' and/or
'collateral' warranty rights for defect repairs on bespoke
systems.

EXAMPLES:
• JCT standard forms – Collateral Warranties
• UK’s Property Care Association - Guarantees
• notes by ICE on collateral warranties
• compare with USA states’ schemes of warranties
• Note reference to “contractual warranties” in Woolcock Street
Investments Pty Ltd v. CDG Pty Ltd

Warranties
- vs Service Agreements
• Note the difference between Warranty / Guarantee vs
‘servicing’ agreements ...
• Supplementary requirements for servicing might be included in the
Contract Documents;
- typically known as service agreement, a service contract, or a
maintenance agreement (similar to ‘extended warranty’ for products)
- & might become a ‘term’ contract
- & might be integrated as part of Warranties (& vice versa)
- might cover faults in a product’s materials & workmanship
- may involve replenishment of consumables
- may address wear & tear / weathering
- may be at call or a regular / periodic servicing schedule
- may involve preventative inspections
- may involve re-tuning, re-balancing, etc
• Servicing air-conditioners, Lifts, other building services
• Watering and cutting / pruning planting
PART 5: EXTENSION OF TIME
In regard to completion ...
Extension of Time (EOT) and Delay occurs
when the Works …
… are not completed by the contractual Date of Completion
… ie not completed within the Contract Period;

Note:

Building contracts typically are not with “time of the

essence” ie delay in completion will not …
… cause material harm /
… render the agreement meaningless /
… render it impossible for the principal purpose or the
performance of obligations (ie the building) to be
accomplished
...... i.e. the time to complete can be extended!

Clause 25 provides for where the Works involve

different “Phases” or “Stages”
Each Phase or Stage has separate Completion Certificates
… and LD, insurance, maintenance, release of Retention
Monies, [but not Final Certificate])
… applied mutatis mutandis “as if each Phase or Stage
was the subject of a separate and distinct contract”

Clause 26 provides for where the Employer wants

to occupy ‘part’ of the Works …
… which is sufficiently complete, but
… before the whole of the Works (or Phase of
Works) are actually completed
Note: Each Occupied Part has separate;
» completion and maintenance
» LD
» insurance
» release of Retention Monies

Revised Date for Completion

Architect to issue ‘Certificate of Revised
Contract Commencement Date’ if
requested by contractor.
- postpones (shifts-back) the commencement of contract
period, not an extension of the contract period.
- compared with failure of Employer to afford proper
possession of the Site despite the Commencement Date,
which is covered by EOT (See 23(2)(i) with 10(2))

Thus; changing the Time for Completion –

3 modes :
• Revised Date for Completion - Clause 10(1)
» A ‘shifting’ of the timeframe to do the works (the
Contract Period) due to Revised Commencement Date
• Extension of Time - Clause 23
» A longer time within which to complete the Works
(an extension of the Contract Period)
• Further Extension of Time - Clause 24(3)
» Further time within which to complete the Works
(a period between termination of certified delay and
certified completion or certified further delay)

Extending the Contract/Phase Period &

recalculation of Date for Completion (EOT)
Requirements for EOT:

IN_PRINCIPLE ENTITLEMENT:
1) Subject to the Contractor giving ‘notice’ [see Subclause
23(3)].
2) Only if delaying factors are within the grounds set-out
in Sub-clauses 23(2)(a)to(q).
3) Subject to the matters / events causing real delay to
the completion of the Works. (cannot be hypothetical)

QUANTUM: (how much EOT)

4) Subject to “due diligence and the taking of all
reasonable steps by the Contractor to avoid or reduce
[the delay in completion].”
5) Substantiation: the submission by the Contractor of
“sufficient explanation, information, particulars or
materials that will enable [the Architect] to estimate
the period of extension of time to be granted”
6) Concurrent Delay (and usually and Critical Path)
Considerations (2 delaying situations concurrently -> cannot double count)

Comments on the ‘grounds’ for EOT

entitlement?
• 23(2)(a) : Force Majeure
» where part of the contract cannot be performed due to
causes that are not within the control of the parties,
such as natural disasters, that could not be avoided
through the exercise of due care.
» Do shortages of materials constitute Force Majeure
(eg a country’s ban on supply of certain materials (eg
sand) to Singapore?). See also 23(1)(m). Google this
issue on the internet!
• 23(2)(b) : exceptionally adverse weather
conditions
» typically assessed as raindays (days in which
prescribed a rainfall measurement is exceeded) in
excess of the average number of raindays per month.
» Note: Does this ground apply for pure ‘inside’ works?
Cl. 23(1) refers to EOT “as may reasonably reflect any delay in
completion which .... has been caused by [the stipulated grounds]”.
So, EOT only applies if the exceptionally adverse whether actually
causes delays. One might consider the affect on delivery of materials
to Site, but probably not the ‘inside’ works per se (?).
The delay must also be “notwithstanding due diligence and the taking
of all reasonable steps by the Contractor to avoid or reduce the [delay
in completion]”.

• 23(2)(c) : fire, storm, lightning, high winds,

earthquake or aircraft or aerial objects
• 23(2)(d) : war, hostilities, insurgency,
terrorism, civil commotion, or riots
• 23(2)(e) : industrial action by workmen, strikes,
lockouts or embargoes

• 23(2)(f) : Architect’s instructions

» but relating to clauses:
• 1(1)(c)(i) : varying the permanent works
• 1(1)(c)(ii) : varying temporary works or methods of
working
• 1(1)(c)(iii) : postponing or suspending work (w/o
defect / contractor fault)
• 7(1) : variation required to comply with statutory
requirement
• 11(2) : inspection of works covered up or for tests
or investigations
• 14 : instruction to deal with discrepancy

• 23(2)(g) : Architect’s instructions given in

relation to P.C. or Provisional Sum
» But only where the work constitutes a variation
(change from description of work, materials or goods
in the Contract Documents)
• 23(2)(h) : Architect’s instructions under Clause
28 … in regard to Contingency Sums
» ie where the works to be ordered are totally unknown
at the time the Contract is made, thus constitutes a
variation

• 23(2)(i) : failure of the Employer to afford

possession [of Site] to the Contractor
» Cl. 10(2) entitles the Contractor to free and
uninterrupted possession of the whole of the area of
the Site on the Contract Commencement Date

• 23(2)(j) : the Contractor not having received

from the Architect within a reasonable time
necessary drawings, instructions and other
information …
» reference Clause 3(2):
• the Architect shall supply further or working
drawings, specifications, details, levels,
instructions … necessary to amplify and explain in
detail the work to be carried out … within a
reasonable time [considering: programme, rate of
progress, extended Date for Completion,
reasonable pre-planning requirements, advance
notice or request]

• 23(2)(k) : acts or omissions [failure to act] of

other contractors engaged by the Employer
• 23(2)*(l) : shortage of labour
[*optional clause]
• 23(2)*(m) : shortage of goods and materials
[*optional clause]
» Would this provision address the ‘sand ban’ issue?
Consider difficulty (or costliness) of procurement vs
absolute non-availability of goods and materials.

• 23(2)(n) : valid suspension of work

» Contractor is entitled to suspend work under Cl. 33(5)
if Architect fails to issue a required Certificate or
statement in writing, and under Cl. 33(6) in
accordance with SOP Act provisions (ie for nonpayment
of adjudicated amount)

• 23(2)(o) : grounds under ..

» 1(7)(b) : relates to unauthorised orders by Architect
» 3(5)(c)(ii) : damage to Works caused by Employer /
Consultants
» 7(2)(e) : variation due to statutory obligation
» 14 : instruction related to discrepancy
» 29(3)(a)(ii) : order Contractor into sub-contract despite
valid objection to the sub-contractor nominated
» 29(3)(b)(ii) : order Contractor into sub-contract despite
valid objection to a term in the Nomination Instruction

• 23(2)(p) : any act of prevention or breach of

contract by the Employer, or any matter in
respect of which … the Employer gives the
Contractor an indemnity
– A ‘cover-all’ clause: - consider the previous
notes on granting EOT for ‘prevention’
situations (else time may become at large)
– Thought: is the Architect's specification of a material
that is known to take 3 months to order/deliver vis—
vis a Contract Period of 2 months considered an act
of prevention, or something the Contractor should
pick up while tendering?
• 23(2)(q) : any other grounds … expressly
mentioned in the Contract Documents
– Note: mentions “Contract Document” rather
than “Conditions” - hence other ‘grounds’ for
EOT could be added in supplementary terms.
– Eg should / could ‘obtaining TOP’ be written in
as a ground for EOT ?? (See notes in previous
lecture on Completion / Post-Completion)

Remember; Architect only authorised to grant

EOT as provided for in contract
- especially that EOT is subject to the stipulated
‘grounds.’

Note on TOP as criterion for 'completion':

» If TOP were written into the Contract as a criterion for
Completion, then the potential for the Statutory
Authorities to delay completion (eg beyond a
stipulated period allowed for TOP application
processing) would need to be expressed as a ground
for EOT.
» If not, EOT would not become entitled.
» It would also be argued as to whether such delays are
Employer-caused (ie could set time at large) or a
‘neutral event’ (hence the Contractor’s risk).

Mitigation of Delay
• Subject to “due diligence and the taking of all
reasonable steps by the Contractor to avoid or
reduce [the delay in completion].”
» Similar in nature to Cl. 21 requiring that “the
Contractor shall proceed with the Works diligently and
with due expedition at all times until completion.”
» What are ‘reasonable steps’? Does this involve cost to
the Contractor? Eg can an Employer expect
‘acceleration’ in the progress of works, or just
(replanning, rescheduling, w/o extra cost)

Contractor to give ‘Notice’ (Cl. 23(3):

» A ‘condition precedent’ to EOT is that the
Contractor is to give notice within 28 days
• (unless Architect has already expressed
‘willingness’ to grant EOT)
» The Architect is not authorised to grant EOT if this
requirement is not met.
• [Also note that Cl. 37(3)(f) does not allow an
Arbitrator to disregard or substitute with his own
decision a decision of the Architect on EOT if the
Contractor had failed to give notice in compliance
with 23(3)]

» The ‘Notice’ is only required to;

• Notify the Architect of any event or direction or
instruction that the Contractor considers will
entitle an EOT,
• Give explanation as to why delay to completion
will result
• [it does not need to give information/particulars,
nor justification for EOT, nor estimate the duration
of delay].

» 28 days to give 'notice' is from the date the ‘event’ /

‘matter’ is known - not necessarily the date it finishes.
[eg this gives the Employer opportunity to change /
retract an instruction, or to order acceleration of the
Works progress to avoid the delay
• eg to meet an important key date for completion
(eg fixed date for ceremony or to committed date
for commence of business, or to start a school
term, etc)
• to avoid claims by Contractor under general law for
prolongation costs (if EOT is granted)]

Request for Information and Architect’s

Decision on EOT
Firstly, the duty of the Architect:
Clause 23(5) : After any delaying factor has
ceased to operate and it is possible to decide
the length of period of extension the Architect
shall determine such period of extension (and
should notify the Contractor in writing).
(contractor to provide information, not prove.
the architect determines the EOT)

» “…the Architect shall determine such period of

extension …” - ie the Architect’s duty, and not subject
to a ‘claim’ by the Contractor (although Contractor
may be required to submit explanations, information,
etc).
BUT Contractors usually submit a ‘claim’ for EOT, to
ensure that the Architect is aware of the purported
entitlement.
ALSO, Contractor’s want to be ‘helpful’ with
supporting information, to maximise EOT assessment.

Architects should strive for a practice of timely

grant/notification of EOT, eg under consideration of:
(don’t delay EOT even though you technically have until final cert.)
– ‘constructive acceleration’ (?) // fairness: knowing a
clear date for completion.
– if heading towards ‘termination’: failure of expedition
and due diligence (ie lack of progress) is difficult to
prove/establish if EOT is still owing.
– Delay Certificate cannot be issued until all EOT
matters are dealt with, thus would hold-up the
accruement and recovery of Liquidated Damages
[Further: might threaten the Employer’s ‘security’ if
Contractor goues bankrupt in the meantime].

A format for a grant of e.o.t. is not provided in the SIA Specimens,

(not the same as report for assessment to grant EOT)
so it will typically consist of a letter [supported by a separate e.o.t.-
assessment report], for example:
I refer to your notice of delay ref: ___, dated ___ in regard to [the event or
Instruction or Direction] that you consider entitles you to an extension of
time.
In accordance with clause 23(5) of the Conditions of Contract, my decision
& estimate of the length of period of extension beyond the Contract
Completion Date is XX days.
Accordingly;
- Original Contract Completion Date : dd/mm/yyyy
- Revised Contract Completion Date : dd/mm/yyyy
- 1st Extended Contract Completion Date : dd/mm/yyyy

In order to fulfil his duty to decide on EOT:

Clause 23(4): “The Architect may in writing
request the Contractor for sufficient
explanation, information, particulars or
materials that will enable [the Architect] to
estimate the period of extension of time to be
granted...”
» within 28 days of the Architect requesting in writing

» The Conditions state: The Architect shall not be

required to decide and estimate the EOT unless
in receipt of the sufficient information etc
requested.
[BUT : be careful in establishing what is
‘sufficient’ - general expectation of the Courts is
for the Architect to do the best possible with the
information available - not to take an easy way
out!]

(the architect cannot say I cannot assess because you haven’t given enough
information. But rather, if insufficient info given, that be a conclusion of the
assessment.)

How to assess EOT?

• Generally accepted in law that the EOT is a
reasonable estimate (not an exact science),
but;
• Generally required by law that the process of
estimating the quantum of EOT shall be
reasoned and methodological - not
impressionistic.

• Different theories exist for

determining/assessing EOT, but SIA does not
stipulate or recommend any particular
approach / method.
» eg see the SCL UK's protocol for delay.
• Most theories and approaches involve analysis
of ‘programmes’ and ‘critical path networks’

... Typical points in assessing e.o.t.:

• (1) The delay event cannot be treated as
"minor outstanding work".
• (2) In-principle Entitlement
• (a) 'Real' delay to Completion.
• (b) Notice (or Architect's willingness)
• (c) Grounds
• (3) Quantum
• (a) All reasonable steps to reduce/avoid delay
• (b) Available info to substantiate (esp 'r.f.i.')
• (c) Concurrent delay events
• (d) Critical path (+ wrt prep; procurement; works)

What is ‘critical path’?

• Where a delay in one task has a consequential
and unavaoidable knock-on effect to
subsequent tasks such that the overall
completion is delayed.
– Eg: Piling - Sub-structure - Superstructure -
Building Envelope - Internal Works --
completion.
• As distinct to tasks that are carried out
‘concurrently’ or ‘simultaneously’ to work tasks
on the critical path.

• In law, the Architect is required to act

‘impartially’ when estimating EOT, and shall
not be influenced by either party.
--eg Architects (PC&E) Rules
--eg general professional duty imposed
by the Courts
– (else the EOT decision / Delay Certificate may be
ruled to be invalid, and possibly time would be at
large, so LD cannot be applied).
– The Architect must act ‘impartially’ and ‘fairly’ and no
longer as the ‘agent of the Employer’ for purposes of
estimating EOT - as EOT can lead to recovery of LD.

• Also note the Architects Rules 1991 -The Schedule (Code of

Professional Conduct and Ethics)
(Act 22 of 1991, Section 38, The Schedule)
- Part I, Rule 3 - Conditions of a contract
3.- (1) An architect shall at all times apply the conditions of a
contract with entire fairness between his client and any
contractor concerned, and in any questions arising between his
client and the contractor in which the architect is acting
between the parties by reason of his professional expertise, he
shall act in an impartial manner.

<of interest…. Skip….>

PART 6: DELAY & LIQUIDATED DAMAGSE (LD)
Delay - Cl. 24(1)
The Contractor is in default if … (his fault)
» After latest date for completion (ie revised or
extended date)
» No other matters entitling EOT
» Works nonetheless incomplete
... then, Architect may issue a Delay Certificate @SIA only
» at any time up to and including the Final Certificate
• (if was ‘as soon as possible’ then any error in
certificate would invalidate the Delay Certificate -
thus time would become 'at large' and any
entitlement to LD would be lost)

Note: In comparison ....

» PSSCOC does not use a ‘Delay Certificate’ approach.
» SIA MWC uses a “Certificate of LD Entitlement”.
• ie, to formally advise the LD quantum entitled.

Liquidated Damages (Cl. 24(2))

• Upon a Delay Certificate, Employer shall be
entitled to accrue & recover LD
» at the rate stated in the Appendix
» at Employer’s discretion whether to deduct
• Note: LD is a pre-determined quantum of
damages that may apply if Contractor
breaches contract (ie fails to meet complete
contractual obligation to complete on time)
» An estimate of realistic / reasonable losses if the
Works are delayed - need not be proven in detail.
» Not a penalty’ (ie not to be unreasonably excessive).

• LD is a pre-agreed rate / quantum of liquidated

(monetary) damages.
• It is deducted when in-fact the Contractor is in
delay in completing the Works.
• Unlike ‘general damages’
1. which need to be ‘proven’ as actual loss, and
2. which are usually sought through (expensive & timeconsuming)
litigation or arbitration
LD is a ‘self-help’ remedy (like common law
rights to set-offs) under contract.

Termination of Delay (Cl. 24(3)

• Termination of Delay Certificate is issued
where a matter that would entitle the
Contractor to EOT (regardless of the
Contractor’s own delay*) occurs during period
of delay (e.g. increased architects instructions -> revokes delay status)
*(The principles of the ‘concurrent delay’ doctrine require that
neither party can recover damages from the other while at fault
himself…
… hence; the Employer cannot profit from liquidated damages
during a period of the Contractor’s culpable delay if the
Employer has also prevented completion).
• Stops the continuation of accruement of LD

Further Delay Certificate

• Upon a Further Delay Certificate, Employer
shall be entitled to recommence accruement &
recovery of LD

Completion Certificate
• the liability of the Contractor to pay LD shall
cease upon the issue of the Completion
Certificate.
• [Although I would say ...
... the liability of the Contractor as to the accrual of LD
shall cease upon the date of Completion as certified by
the Architect in the Completion Certificate.]
PART 7: MISCELLANEOUS TOPICS ON EOT & DELAY
*Is just notes for reference
OTHER CONSIDERATIONS REGARDING
_EXTENSION OF TIME FOR COMPLETION
_DELAYS ….

What would happen if there was no EOT

provision in the Contract?
- for Neutral Events:
EOT is a contractual provision to allow the Contract Period
to be shifted and extended …
… else even in the case of delays due to ‘neutral
events’ (eg Force Majeure) the Contractor’s
obligation would still be to strictly comply with
the Contract Period and Date for Completion
Note: Very difficult to achieve “frustration” or “impossibility” of a contract –
where a contract may be set aside due to an unforeseen event, that could
not have been induced by the parties, making it impossible for the principal
purpose or the performance of obligations to be accomplished.

Changing the Time for Completion

Considerations:
• NEUTRAL EVENT Delay
• … those events not caused by the act or omission of a
party, ie beyond the parties’ control
• EMPLOYER-caused Delay
• CONTRACTOR default Delay

Issues of NEUTRAL EVENT Delay:

EOT provisions in contract relieve the Contractor of
otherwise being allocated the risk of delays due to
‘neutral’ events …
… considering that the Courts will generally enforce the
contract on it’s terms as agreed to by the parties
(irrespective of commercial fairness),
… ie the Contractor would otherwise still be obliged to
complete the Works by the Contractual Date for
Completion, irrespective of hardships caused by Neutral
Events
… hence EOT affects the commercial bargaining /
negotiations, and contract price (ie risk = $)

Issues of EMPLOYER-caused Delay:

EOT is to avoid the effects of ‘Prevention’
ie delays caused by Employer through preventing /
hindering the Contractor’s performance of obligations
under the contract*
*Acts of Prevention (such as late decisions and information, or late
possession of Site) can include acts of the parties under the
Employer’s control, eg the Architect as agent of the Employer
who administers the contract
‘Prevention’ can cause the “Date for Completion” to fall
away / become undefined (hence time becomes ‘at large’)
When time is at large:
(a)the Date for Completion can no longer be applied, so
the Contractor only needs to complete the Works
within a ‘reasonable time’
(b)therefore LD provisions cannot be applied as there is
no defined starting date of delay default
(c)so the Employer would only be entitled to general
damages (if Works are not completed within a
‘reasonable time’)

provision in the Contract?

- for Employer Delays:
• Lian Soon Construction Pte Ltd v Guan Qian Realty
Pte Ltd (No 2)[2000] 1 SLR 495; [1999] SGHC 259
... where there is any prevention by the employer of
the contractor’s performance of the contract and
the contract does not provide for extension [of
time], or if it so provides but extension is
improperly withheld, the contractual date for
completion will cease to apply, and the employer’s
entitlement to liquidated damages, if any, is gone;
his remedy for the contractor’s delayed
performance, if any, is confined to general
damages, which in most cases would be more
difficult to prove than are liquidated damages.

- for Employer Delays:

» ‘time at large’ is often argued by Contractor’s
lawyers (eg where there is claimed error in
Architect’s certificates, so the revised date for
completion is not clear) ie so Employer’s
entitlement to liquidated damages, if any, is
gone.

» Typically ‘time at large’ - a situation where there is no

longer a defined date for completion - is due to:
• 1. No fixed date [but not usual in SIA form due to
Appendix]
• 2. Date ceases to apply due to;
– (i) act of ‘prevention’ by Employer (where
(a)there is no provision to regularise the
prevention with an EOT, or
(b) EOT is improperly withheld
– (ii) ‘breach of contract’ by Employer
• 3. Employer ‘waives’ obligation for completion
• 4. Interference by Employer in certification

» When time is at large, it is a usually an implied term

that the Contractor is to complete ‘within a
reasonable time’ (usually determined retrospectively
based on the facts).
» Where contract allows for EOT, the Date for
Completion is ‘reset / revised’ - so a clear and defined
date for completion still exists - to preserve the
Employer’s right to LD for breach of obligation to
complete on time.
» If no EOT clause then a new contract is required to
set a new date for completion, or time becomes at
large if the existing contract is to be pursued.