Rmk354 Construction Law

SCHOOL OF HOUSING, BUILDING AND PLANNING (HBP)
RMK354 CONSTRUCTION LAW
SEMESTER 2 ACADEMIC SESSION 2020/2021
ASSIGNMENT 1 (group)
GROUP NAME
NAME MATRIC
NUMBER
MUHAMMAD MIRZA BIN MOHAMMAD ROSSIDI 146603
NUR NAZIRAH BALQIS BINTI CHE ROZAK 146537
NUR AFIFAH BINTI RAZALI 146895
NOR ASHIKIN BINTI HISHAMUDDIN 147942
MOHAMAD ZULKIFLI BIN AMIR 146168
SUBMISSION DATE AND TIME: 7th MAY 2021
SUBMISSION: PORTAL ELEARNING
LECTURE NAME: DR. ZUL ZAKIYUDIN BIN AHMAD RASHID

RMK354 CONSTRUCTION LAW | ASSIGNMENT 1
TABLE OF CONTENT
PAGE
NO CONTENT
NUMBER
1.0 Executive Summary
4
2.0 Introduction 5-6
3.0 Requirements for progress claim to be followed by a
contractor. 7
3.0.1 Basic Requirements
7-8
3.0.1.1 Claim Identification
3.0.1.2 Claim Notification 8
3.0.1.3 Claim Documentation 8-9

3.0.2 Based on clauses of PAM of Contract 10
2018 and PWD 203 of Contract.
4.0 Common mistake(s) by a contractor in the whole process 11
of progress payment claim.
4.0.1 Delays that occur without delivery of notice. 11-12
4.0.1.2 Based on PWD 203 Contract and PAM of Contract
12-13
(2018).
4.0.1.3 Analysis of Case Law (Malaysia Case Report)
13-14
4.0.2. Fail to submit the required complete details within the
stipulated time. 14
4.0.2.1 Based on PWD 203 of Contract and PAM of
Contract (2018). 14-15
4.0.1.2 Analysis of Case Law (Malaysia Case Report) 15-16
4.0.3 clauses 44.0 claims for loss and expense. 16
5.0 Suggestion(s) for best practice(s) to be observed by contractor in 17

ensuring that progress claim can successfully be made.
5.0.1 Identification of Late and Non-Payment Problem 17-19
5.0.2 Impact of Late and Non-Payment 19-20

5.0.3 Late and non-payment issues could have a solution.
21-23
2
In ithe ievent ithat inon-certification iwas ito ithe idefault iof 23-30
iproject iconsultant, iwhat iare ithe isteps iand iOPTIONS
6.0
iavailable ito ithe icontractor iin ichallenging ithe iconsultant
6.1 Slowing Down the Work 23
6.2 Application for Summary Judgment 23
6.3 Apply for the Winding up of Employer’s company 24
7.0 Conclusion 31
8.0 References 32-33
3
1.0 EXECUTIVE SUMMARY
This report discusses the legal position on the terms of a claim that must be made by a
contractor in making a claim. Therefore, the law that needs to be referred to is the standard
PAM clause Form of Contract 2018 and PWD 203 Standard form of contract where it
describes the conditions and methods that must be made in the event of loss and expense
claims, direct and indirect claims and cases involving reasons for losses and expenses as well
as some suggestions to improve the way the contractor to make a claim successfully in
accordance with the written contract.
The report also clearly discusses the conditions if the contractor wishes to make an extension
of time. It is enshrined in PWD 203 and PAM 2018 such as delay, time extension method if
the contractor is convinced of the delay. If any of these circumstances occur, the above report
summarizes the procedures that apply to claims for losses and expenses. There are also
measures and options available for contractors to challenge a consultant in the event that a
certificate cannot be obtained due to the failure of the project consultant. In general, it gives
justice to all parties in obtaining their respective rights.
The report has also attached new case law on common mistakes made by contractors When
making a claim, the steps, and options available to contractors to challenge such consultants.
For example, the case of a sewerage project using the IEM 1989 contract form, modelled
under PWD 203 Standard Form of Contract. Where claims made by contractors to extend
project time mostly involve infrastructure work. The completion date of the project under the
contract was May 20, 2000.
The argument was made based on his rights as a result of employment being delayed due to
complaints from landowners, residents, and the nearby business community. Furthermore, the
inability of the contractor to procure supplies due to conditions beyond his control, as well as
extreme ground conditions. Based on this case study, it was found that the supporting
documents provided were insufficient information as the details and calculation of the
number of days of delay claimed were unknown. Even so, the inability to show the delay in
detail does not mean the contractor is not entitled to a Long period of time. Finally, this
report explains the situation where a contractor challenges a consultant if there is no
certification made by the consultant due to project failure. Where among them the contractor
gives fact to the idea and its benefits if it is not achieved if the payment of the claim with the
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consultant cannot be resolved. All requirements of this report should be referred to PWD 203
and PAM 2018.
2.0 INTRODUCTION
Normally, contractors are typically paid in phases during the project and are required to make
progress claims to the architect on a regular basis under most traditional construction
contracts. The architect evaluates the claim based on the work completed, labor and materials
used, and other construction-related expenses, and then issues a certificate of performance
that specifies the sum agreed to be paid to the contractor at the time of issue.
The architect can use this scheme to prevent the contractor from being paid for unfinished
work or failing to meet the specifications of the design document. When the construction
contract is awarded, the contractor should be informed to plan a schedule for the anticipated
monthly progress payment (or another agreed period). The actual payment will be determined
by the amount of work done by the contractor and will most certainly vary from the schedule.
Schedules, on the other hand, can be a helpful budgeting tool.
Many construction contracts require the architect to plan and provide progress certificates as
an independent professional assessor whose evaluation and valuation both the developer and
the contractor have agreed to follow by. It is among the few times in the contract that the
architect does not serve as the agent, and the developer should not do something that
prohibits the architect from acting separately as an assessor and certifier.
The standard procedure and obligations for progress payments are as follows:
 The contractor submits to the architect a progress claim.

 The architect evaluates the claim, decides the amount of money due to the
contractor under the contract, and grants the contractor a certificate of success.
 The contractor presents the developer with the progress certificate and tax
invoice for payment.
 Building contracts usually prescribe a time frame during which the developer
must make payments.
As for the given situation, the contractors, Syarikat BinaMaju had submitted the progress
payment for the works carried out in Projek Pembangunan Sekolah located at Batu Pahat
Johor. The issue occurs as the progress payment cannot be made because of the claim was not
certified by the consultant for certain reasons.
5
Hence, this report will briefly discuss on what are the requirements needed for progress claim
that should be abide by the contractor, the common mistakes made by contractors during the
whole process of progress payment claim, the suggestions for best practices to be observed
by contractor in order to certify the progress payment can be made successfully and the steps
and options available to the contractor in challenging the consultant during the situation that
non-certification was due to the default of project consultant.
6
3.0 REQUIREMENTS FOR PROGRESS CLAIM TO BE FOLLOWED BY A

CONTRACTOR
A claim is a right that needs to be given to the party making compensation to the other party. In
general, claims are often made by construction contractors to claim damages in excess of the
total contract costs agreed under the initial contract made. This is because, the contractor suffers
a loss in terms of cost and time in construction before payment can be made by certain parties.
Therefore, the claims process must go through a process of litigation, arbitration, or other
methods. However, another method of claiming is simply a blanket simply because non-
compliance with the terms of the contract causes the contractor to incur substantial losses. In the
case of Bina Maju Companies, contractors must meet the conditions that must be complied with
by them to fulfil the claims process under the construction contract. Among them are:
3.0.1 Basic Requirements

3.0.1.1 Claim Identification
The thing the contractor should do is identify the claims that should be made at the beginning of
the project so that it can be completed immediately. This identification is important because it is
to ensure that all stakeholders know all the important information, and this is said to be a
requirement that the contractor must do before proceeding with the matter of making a claim. In
fact, this identification has the potential to help all parties make decisions in the event of any
claim disputes during construction, especially those involving additional work and
compensation.
The process of making a proper claim is by making a claim identification. Contractors should
ensure that they are able to find out, identify the claims they want to make similar to future
notifications. Generally, contracts whether public or private have clauses relating to notification
notices of different site conditions, changes, and delays with a set time expectation. Before a
settlement is made, the important thing is to identify the source of the claim. The process of
making a Successful claim often involves people who have an awareness of the claim,
familiarity, and awareness of the potential circumstances to make a claim.
While the recognition of the claim is automatically detected through a change of instruction from
the customer. Contractors need to identify the state of the claim begins to develop according to
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the process of the project and not after it becomes something difficult to make later. Identifying
claims and making notification notices are essential to meeting the requirements of the contract.
The contractor should not have to wait too long in acting as it will cause the contractor’s right to
make a claim to be lost. If the contractor fails to identify the claim until the end of the project, it
can affect the contractor where their contract will be suspended, and the claim will not be
Succeeding.
3.0.1.2 Claim Notification

Next when the claim to be made can be identified it should go through a notification process. It
is an important condition in a construction contract where the contractor must give timely
notification of the claim to the parties involved. A form of contract that provides for several
mechanisms and has a clause on notification and possible causes that will occur if the
notification is not made exactly in compliance with the contract's terms.
The clause enshrined in the contract serves to ensure that both the contractor and the government
have a date and facts that explain the circumstances related to the claim. In fact, this serves to
protect the rights of both. In addition, the contractor can respond to claims if the notice clause is
used. This situation allows the contractor to also make notifications systematically. Many
contracts in the construction sector require written notice to make changes, different site
conditions, additional work or other related work and can involve contractor time and costs.
The notice given must be accurate and the contractor must meet the terms of the contract.
Making Notifications is a very important thing to prevent the contractor from violating the terms
of the contract through late notifications. Delays in making notifications are a common problem
due to the negligence of the contractor himself. Therefore, the management in making a claim is
to do early notification so as not to inconvenience the various parties.
3.0.1.3 Claim Documentation

After going through the initial claims process, the contractor must provide complete and solid
claim documents to prove that the contractor has the right to make claims and resolve disputes.
The contractor must execute the claim in compliance with the contract's terms such as notice,
and deadline accompanied by important documents in order to further strengthen any claim
made. The information shall be consistent and easily understood by the S.O.
8
The process of preparing and submitting the documents is important as the contractor can refine
the claim from beginning to end. The documents provided are to support the claim where it
includes the method, the date of correction which has been agreed by the parties involved. While
the document should be clear, accurate and easy to read. The contents of the claim document
which has the details of the claim price and the calculation of damage that occurred during the
project. The document should also be attached with relevant charts, graphics as well as
photographs to prove the matter to be true and indisputable by S.O.
In addition, the document must also contain specifications, special conditions of the contract and
specific instructions where the calculations made by the contractor and the offer document can
be made as evidence to make a claim. In addition, the contractor should also provide a project
diary that includes weather conditions, manpower, visitors, implementation schedule of project
running time and most importantly the contractor must record all key events that could cause
claims to be made possibly involving time and cost.
Before beginning work on the project, the contractor must sign a written agreement with all
parties involved that complies with the contract's terms. This is because, the contractor can
update the records in case of changes if approved. Therefore, if before the claim made can be
identified, it makes it easier for the contractor to keep a good record of construction work
activities. However, there are problems in supplying documents that occur as a result of three
basic conditions, namely:
 Obtain accurate amounts and types of information.
 Get information from the right individuals.
 Inform in a timely manner.
If these considerations can be properly addressed, those responsible for handling the relevant
claims can resolve them well. Therefore, the contractor must be proactive and reactive in varying
the claim documents so that immediate action can be taken if any problems arise during the
contract. The Contractor should also be sensitive to making a timely written response in the
event that the claim becomes a dispute.
9
3.0.2 Based on clauses of PAM of Contract 2018 and PWD 203 Contract
The contractor must submit full details with price receipts, voucher records, and other
documentation to show the contractor made a claim under clause 44 along with complete
documents within three months after the realistic certificate of completion is released. This is to
allow the SO to finish the final account while the contractor receives written notice of the claim
within the time frame stated in the contract.
However, if the contractor fails to include full documentation in the claim phase within the time
frame specified, the claim will be denied. To make the final determination, S.O. will make an
immediate evaluation based on the available documentation given by the contractor. The
government is exempt from any liability as a result of this lawsuit.
Make successful defects based on clause 48 for a period of three months after the end of the
defect obligation period for the whole job or three months after the issuance of the certificate of
completion. The final certificate must then be accompanied by all necessary documentation and
facts, such as receipts, voucher records showing final SO assessment, and the sum specified in
clause 31.1 in accordance with the contract's requirements.
After obtaining approval and permission from the government or S.O. against payments or
expenses made. Next the final certificate will state the final balance to be paid by the government
to the contractor or the contractor to the government, whichever is indirectly related to be the
debt to be paid. Any deductions that have been approved but not yet made by the government
and are covered by the contract will be listed on the certificate.
10
Effect of S.O.'s certificates

If a contract does not have an S.O certificate it is a final decision on the adequacy of any
work, materials and anything related even the contractor remains bound by his responsibility
to make changes in terms of imperfections or alleged any other offenses as provided in the
contract. And if not having an S.O certificate causes disputes between the government and
the contractor cannot be explained properly because this S.O certificate binds any agreement
between the government and the contractor.
4.0 COMMON MISTAKE(S) BY A CONTRACTOR IN THE WHOLE PROCESS OF

PROGRESS PAYMENT CLAIM
4.1.1 Delays that occur without delivery of notice
It is common for all construction companies to use an extension of time in construction

problems. This problem is a common mistake used by contractors in making progress
payment claims process. However, the offense committed may refer to the clauses of
Contract. A research was performed to determine the main issues that contractors face when
submitting payment claims. Where there are identified case studies that occur in the
construction business where every payment claim has a problem due to the contractor himself
Each construction contract, the contractor is under the legal responsibility to complete the
construction project according to the set date to complete the construction project on time.
However, delays often occur causing the performance of the work contractor to be affected.
Any delay may be due to the contractor or a superior or this situation may not occur due to
both parties or be known as a general offense or neutral event.
The contractor seems to have no obligation to a time extension, loss, or costs if the delay is
caused by his own negligence, according to construction law. In this issue, according to
William (2003) states that delays can be categorized as forgivable delays and get
compensation and unforgivable delays as well as non -compensation. Generally, a contractor
can be forgiven in the long run if it is caused by an employer or a neutral incident. Arguably
most contractors list the reasons for the delay to extend the time, any losses, and acceptable
expenses.
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The contractor’s request to extend time in a construction project is largely unavoidable.

According to Turner and Turner 1999, where their efforts to prove rights or assess the
extension of time have been made. However, the contractor was unable to inform the SO of
the possible delay by giving notice. This is because each construction contract standard
requires the contractor to notify the application for an extension of time.
This is an issue that the contractor is having because he has not given notice of
postponement, despite the fact that the contract states that this is a requirement that comes
before the contractor's right to extend the period. Therefore, if the contractor fails to do so,
the contractor loses his right to extend the time of the construction project and is unable to
claim the next payment and suffers a loss due to not notifying his superiors.
Generally, notification of delays needs to be notified before the completion date of the
construction project takes place. Therefore, the contractor reserves the right to provide
relevant supporting documents to be provided to the contract administrator to assess whether
the reasons for extending the time of the construction project are acceptable or not. However,
the conditions used are direct procedures but many of the problems that occur stem from
claims against the extension of construction project time according to the contract date.
Among them are:
a) Notice of claim made by the contractor is advance notification of the right to extend the
time.
b) Failure of the employer to provide an opportunity to the contractor in extending the time.
c) Effect of contractor's failure to give notice of deferment.
A common problem in construction is that contractors do not understand their obligations

based on the provisions of the notice. This causes the contractor to fail to comply with certain
notification procedures. Therefore, there are many disputes that occur due to notification or
late notification before the project completion time that has been set.
This makes it impossible for contractors to claim progress based on price on the project's date
of completion. Sometimes, changes in the project may be due to the precautions of superiors.
For example, delays in possession site ownership or changes in instructions by employer’s
cause delays.
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It is unfair to ask the contractor to offer a notice of deferment to secure the contractor's right
to extend the period for such action due to the employer's precautionary steps. This is because
it is beyond the control of the contractor. Therefore, if the contract administrator does not
receive timely notification of the delay, he should consider the incident unacceptable. The
issue of late notification to employers can be linked in the PAM clauses of the Contract.
4.0.1.2 Based on PWD 203 Contract and PAM of Contract (2018).
pursuant to PWD 203 Standard Form of Contract, clause 43.1 which requires the contractor
to inform the officer of the delay stated in the appendix, along with supporting
documentation, such that the officer may form an opinion on the reason for the delay and
how long it took the contract will be delayed or postponed if the officer's opinion in the
appendix causes the contract's work to be delayed or postponed past the contract's deadline.
This is done to facilitate all parties and ensure that the contract is executed in accordance with
current needs despite delays.
In addition, changes, poor site management, inadequate site conditions, insufficient

requirements, failure to provide critical details during the construction stage, or even
scheduling issues may all cause delays in completing a project. Return to the notification that
contractors need to make in case they are expected to be late making a claim. According to
Clause 23.1, within twenty-eight days of the event's official start date referred to in clause
24.3, a notification must be sent. Written notice becomes a condition preceding the required
extension of time. Delays in filing claims, on the other hand, may be a concern for
contractors if they fail to notify the employer of a delay within a certain amount of time,
causing the employer to assume that the contractor would not delay the completion of the
work past the agreed-upon deadline. As a result, no argument can be made, and the contractor
must bear the loss as a result of his own negligence.
Based on the case related to the delay in notification of the notice, it is about a sewerage
project that uses the IEM 1989 contract form, which is modelled under PWD 203 Standard
Form of Contract. Where claims made by contractors to extend project time mostly involve
infrastructure work. The completion date of the project according to the contract was 20 May
2000. The argument was made on the basis of his rights as a result of work being postponed
due to complaints from nearby landowners, residents, and the business community.
13
Furthermore, the contractor's inability to obtain supplies due to circumstances beyond his
control, as well as the site's extreme soil conditions.
Having done so, the completion extension date was fixed to January 3-1, 2002 and the last
time extension application was determined by the contractor. The case has focused on the
events that caused the delay from the actual completion date. The contractor was given an
extension of 92 days (after considering the corresponding delay) from the actual date of 3
January 2002 to 5 April 2002. The extension was accepted as the contractor had provided
supporting documents and information on the application for extension of time in accordance
with the relevant clauses of the contract.
Based on this case study, it was found that the supporting documents provided were
insufficient information because the details and calculation of the number of days of delay
claimed were unknown. Even so, the inability to show the delay in detail does not mean the
contractor is not entitled to an extended period of time. Due to the contractor having
submitted the reason for the delay has resulted in an assessment for an extension of time has
been accepted. This is in accordance with clause 43.1 of the PWD 203 Standard Form of
Contract, which states that the contractor must inform the officer of the delay in the appendix,
along with supporting documentation, so that the officer can form an opinion on the cause
and delay period is necessary. If the officer's opinion in the appendix causes the contract's
work to be delayed or postponed beyond the contract's date, the contract will be delayed or
postponed. This is done to facilitate all parties and ensure that the contract is executed in
accordance with current needs despite delays.
4.0.2. Fail to submit the required complete details within the stipulated time.
In the entire progress payment claim process, another common mistake is committed by
contractors where they fail to submit the required complete details within the stipulated time.
This causes payment claims cannot be made based on a written contract. This often happens
because careless contractors when handling payment claims make it difficult for them to get a
complete payment. If the Contractor fails to meet for terms 44.1 and 44.2, he will not get the
claim, and the employer will not pay any such claim. This is so because, the document
requirements or otherwise have been informed in the contract. Therefore, the contractor needs
to prepare the documents in detail according to the set time. For example, the estimated
amount of losses, vouchers, as well as other documents supporting the claim. If the contractor
fails to satisfy the contract's conditions after the construction project is finished on schedule,
14
the contractor will incur substantial losses as a result of the inability to make claims for
payment. Thus, the failure of the contractor to attach the documents in more detail at the
stipulated time renders it a common mistake made by the contractor in making a claim.
However, the contractor may refer to the clauses of Contract.
4.0.2.1 Based on PWD 203 of Contract and PAM of Contract (2018).
Therefore, the contractor should refer back to Clauses 43.1, based on the standard contract
form PWD 203 which indicates that if “the contractor has suffered losses and / or direct
expenses in excess of the consideration is reasonable and where the contractor would not be
reimbursed for payments under this contract's other clauses, Within thirty days of the event,
circumstance, or direction of notice in writing to the SO on his behalf of the intention to
claim any direct losses or expenses, the contractor is given the right to claim such direct
losses or expenses that are equal to the estimated such losses and/or expenses, provided that
they are still subject to clause 44.2.
However, to enable the SO to assess direct losses or expenses as soon as possible, Under
clause 44.1, the Contractor must use complete documents for all claims relating to direct
losses or costs but no later than 90 days after the work is completed in a practical manner,
together with all supporting records, receipts, proofs, and estimates as may be needed. The
Contract Amount will be added to the total loss or direct costs as determined by S.O.
"Generally, offenses committed by contractors where as a result of unforeseen circumstances
cause them to attach incomplete documents in accordance with the conditions set out in
clause 44.2. This makes it difficult for the SO to determine direct losses or expenses. This
renders the contractor ineligible for claims. and the government will be relieved of all
liability related to the claim because the contractor did not meet the requirements of clauses
44.1 and 44.2.
In the year 2020, there is a case involving Sunissa Sdn.Bhd and "losses and expenses." The
prior notice rule can only be used as a condition precedent if it is written in plain, clear, and
unambiguous terms, and the Contractor's claim is protected by the "prior notice requirement
clause," according to the High Court.
If the prior notice clause is correctly understood as a condition precedent, and the contractor
fails to comply with and adhere to the condition precedent, the Court will uphold the
15
condition precedent and dismiss the contractor's argument. Whatever the outcome, the
plaintiff has been appointed the main contractor for the construction of a new 10-story court
building in Kuantan, Pahang, by the state government.
According to contract standard PWD 203/ 203A (Rev.2007). The dispute resulted from the
contractor's loss and cost allegation of RM11,937,057.33. The claim is dismissed if a client
fails to comply with the terms for advance notice for loss and cost claims. As a consequence,
clauses 44.1, 44.2, and 44.3, which specify the contractor's and employer's settlement of
direct damages and expenditures, are explicitly stated in the contract's terms.
4.0.3 clauses 44.0 claims for loss and expense
16
5.0 SUGGESTION(S) FOR BEST PRACTICE(S) TO BE OBSERVED BY

CONTRACTOR IN ENSURING THAT PROGRESS CLAIM CAN SUCCESSFULLY
BE MADE.
5.0.1 Identification of Late and Non-Payment Problem
Payment delays by parties participating during the payment claim process may impact
the full payment supply chain. Payment problems at the top of the hierarchy, as stated by the
Construction Industry Working Group on Payments (2007), can trigger severe cash flow
issues in the contract chain.
Past studies by Hasmori et al. (2012) found that client’s workers incorrectly keep the
payments, mostly in order to receive sort of "present" from the contractor after they have paid
the bill. Delayed payments are caused by known clients for their own financial benefit, delays
in distributing savings to contractors, and consider delay of payments due to personal
reasons, According to Abdul Rahman and Ye (2010).
Based on the study, contractors in Malaysia say that delays of a maximum of 5

working days is recommended and that they welcome late payments from clients because
they are still serving them. This may happen because of the culture of late payment that
occurs in Malaysia's construction industry, where contractors find late payment over several
days to be appropriate. As stated by Ye and Abdul Rahman (2010), delays in certification by
project participants may also result in late payment issues. The parties involved may postpone
the approval of the submission for payment claims due to a variety of excuses that may occur
as a result of their own or other parties' involvement.
17
Table A: In the building industry, a variety of factors contributed to late or non-payment.
18
19
5.0.2 Impact of Late and Non-Payment
Client issues, service provider issues, resource issues, and universal issues are all
factors that lead to construction delays, according to Haseeb et al. (2011). Client factors are
identified as the primary causes of construction delays, according to the report, the project's
financial planning was insufficient, and it was unable to make payments due to economic
conditions being the most common (Hasseb et al., 2011). Furthermore, tool outages and
labour disputes can cause delays in the project's completion.
Delays during construction projects may result a significant implication that may
stymie the growth of the construction industry and impact the country's economic situation
largely (Abdul-Rahman et al., 2009). Delays in finishing a construction project, as per Abdul-
Rahman et al. (2009), may be the most significant cause of increased costs and loss of
financial gains or other profits from the project. As a result, delays are expensive for both
owners and contractors. The delay reflects a lack of future sales for the owner, while it means
a rise in overhead costs for the contractor.
Payment has continuously become a huge issue in the construction industry, with
many contractors reporting late payment situations in government-funded projects, while
others also reported the similar circumstances in privately funded projects. Late payment in
the construction industry is a global issue, according to Hasmori et al. (2012), and the effects
of this problem in Malaysia have wreaked havoc on the country's economy and tarnished the
construction industry's reputation.
Table B: The Effects of Late and Non-Payment
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5.0.3 Late and non-payment issues could have a solution.

When it comes to handling equipment, transportation, personnel, and maintenance,
clients should learn about cash flow and financial management, while contractors should
learn about risk management. According to Abdul-Rahman et al (2011). Another suggestion
that should be considered is payment bonds with banks and clients.
When it comes to accepting contracts and choosing good employers, contractors must
be cautious (Abdul-Rahman et al., 2011). The committee has a contractual duty to ensure that
claims are made in accordance with the prescribed terms, product delivery, and other
conditions before any payment is certified. In fact, 98 percent of the work could be completed
in ten days or less. The financial officer must clarify why a payment is late in writing
(Hasmori, 2012).
The laws must be revised to send a direct message to developers and clients about
payment issues and reimbursement processes. Termination is only possible under common
law if one party violates the contract, which is the same as a breach of denial. If a party
expresses his intent not to be bound by the contract or to fulfil his obligations through his
speech or acts, he is assumed to reject the contract. In most cases, the employer's failure to
pay the agreed-upon sum is considered a default, and the Contractor would work accordingly .
Failure to pay one payment out of a series of payments, on the other hand, is usually
insufficient to justify refusal.
According to Hasmori et al. (2012), one way to control the problem of late and non-
payment is to implement a new payment system between the developers or clients who
unlawfully delay the payment. Employees will face penalties if they are identified to have
illegally withheld payment.
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Table C: Possible solutions of late or non-payment issues
22
6.0. In ithe ievent ithat inon-certification iwas ito ithe idefault iof iproject iconsultant, iwhat
iare ithe isteps iand iOPTIONS iavailable ito ithe icontractor iin ichallenging ithe iconsultant
The steps available to the contractor in challenging the consultant are:
6.1 Slowing Down the Work
Provisions in the Standard Forms of Contract
Based on the various The PAM 98/2006 standard form and the CIDB 2000 standard form in
Malaysia demonstrate that there is no express clause granting the contractor the authority to
slow down the construction process due to the employer's lateness or absence. Therefore, in
all cases, the contractor does not postpone his job because he has not been paid or because the
employer has not paid him, other than the written provision in the contract authorizing the
consultant to do so, does not necessarily defer his payment.
6.2 Application for Summary Judgment
Provisions in the Standard Form of Contract
the application for summary judgement is not listed as one of the remedies available in any of
the local standard forms of construction contracts. In the case that the employer is late or
refuses to pay, the contractor is responsible. Contractors, contract managers, and employers
are all confused about this subject. They claim that the contractor's ability to obtain Summary
Judgment in court is barred by the existence of an arbitration clause of the construction
contract.
It is important to note that the arbitration provision is intended to resolve project-related

conflicts. Contractors did not contest the amount certified by the Contract Administrator in
the majority of late and non-payment situations. They were simply asserting their right to be
paid on time and in full, unless there are valid grounds as permitted by the contract for
delaying or denying payment.
23
6.3 Apply for the Winding up of Employer’s company.
Provision in the Standard Form of Contract
the primary goal of the insolvency process is to maximise the returns to current claimants by
implementing the company's most effective strategy. On one side, this might lead to the
business being sold for cash, either piecemeal or as a going concern. The protection of
priority is the secondary feature. A successful insolvency process must also meet this
requirement. The question is whether the current insolvency process will guarantee priority
preservation.
Malaysian law distinguishes between natural and legal entities when it comes to insolvency,
with separate bankruptcy and corporate legislation. The Companies Act of 1965, in relation
to corporate insolvency, outlines two specific forms of insolvency measures that are familiar
to readers in the common law world. In the first situation, creditors must select a receiver and
manager for the debtor business (Part VIII, Companies Act 1965).
Clients may also file a court application (Part X, Companies Act 1965) to start the winding
up process, which is divided into three types: voluntary winding up of owners, voluntary
winding up of creditors, and winding up. Apart from the two bankruptcy-related measures,
general corporate law requires a company to enter into a financial restructuring regulatory
scheme.
By making, his claim and filing a winding-up petition under the Companies Act 1965, the
Contractor can be able to compel action. A winding-up petition may be filed by any of the
company's creditors under Section 217 (1) (b). If the temporary certificate is not charged, the
Contractor may file a lawsuit alleging that the Employer's business is unable to pay its debts
(section 218 (1) (e)) or that the Employer's company should be dissolved on reasonable and
equal grounds.
Each iconstruction iproject ihas iat ileast ione iconsultant iappointed iby ithe ideveloper, also
iknown ias ithe iemployer iof ithe iproject. iAlthough ithe itype iof iconsultant iand their
respective iroles imay ivary ifrom iproject ito iproject, ithe irole iof iconsultant igenerally
includes icertification iof iwork iand iprogress. iThis, iin imost icases, ialso irequires ithe
consultant ito iconfirm ithe iamount ito ibe ipaid ifor ithe iwork idone iand ipaid iby ithe
employer ito ithe imain icontractor. iA icertificate iof ipayment iwill ibe iissued iafter ithat.
24
Referring ito ithe iclauses iof iPAM iStandard iForm iof iContract i2018 iand iPWD i203
Standard iForm iof iContract ithere iis ivarious ioption iare iavailable ito ithe icontractor iin
challenging ithe iconsultant. iIn ithe ievent ithat inon-certification iwas idue ito ithe idefault
of project iconsultant, ithere iis ioption iwhere icontractor ican iclaim ifor iinterest. iThe
question of iwhether ithe icontractor iis ientitled ito idamages ior ibenefits ias ia iresult iof
ithe consultant's ilate ior inon-payment iremains iunresolved. iThe ivarious itypes iof
istandard construction icontracts, ilegal icases, iand igeneral ilaw iprovisions ito idetermine
iwhether ithe contractor ihas ithe iright ito ibenefits iif ithe iconsultant idefers itemporary
ipayment ito ithe contractor. i
In iPWD i203A iStandard iForm iof iContract, ithere iis ino iclear iprovision iin ithe iform of
ithis iconstruction icontract istating iwhether ior inot ithe icontractor iis ientitled ito iclaim
interest ifor ilate ipayment iby ithe iemployer. iMoreover, iIn iPAM i98/2006 iStandard
iForm of iContract, ithere iis ino iclear iprovision iin ithis itype iof icontract ithat igives ithe
contractor the iright ito iclaim ibenefits ifor ithe iemployer's ilate ior inon-payment iof ia
temporary certificate.
However, iclauses i34.4 i(vi) iand i(vii) iexpressly iauthorise ithe arbitrator ito award ipre-
award ibenefits i(i.e. iinterest ion ithe iamount iawarded ifrom ithe date iof iaward) and ipost-
award ibenefits iat iwhatever irate ithe iarbitrator ideems ifair. iIn the ilatest iPAM Form iof
iContract i2006, ithe icontractor iis igranted ithe iright ito iclaim interest iif ithe employer
ipays ilate ior idoes inot ipay iat iall. iClause i30.17 ispecifies ithis explicitly.
Anyways, ithere iis ivarious ilaw icases ion ithe iissue iof iinterest ifor ilate ior inon-payment
iby ian iemployer ito ithe icontractor. iIn ithe icase iof iLian iHup iManufacturing iCo Sdn.
iBhd iv iUnitata iBhd, ithe icontracting iparties iagreed ito iinclude iin itheir iarbitration
clause ithat ithe iconstruction, ivalidity, iand iimplementation iof isuch iclause iwould ibe
governed iby iMalaysian ilaw. iThe icourt ihas idiscretionary iauthority ito iaward iinterest
ifor debt irecovery ior idamages iunder iSection i11 iof ithe iCivil iLaw iof i1956. I
As ia iresult, the icourt idetermined ithat ithe iarbitrator ihas ithe isame iauthority ias ithe
icourt ito iaward interest iat iwhatever irate iit ideems iappropriate. iThe iCourt iof iAppeal
iaccepted ia iclaim for ibenefits ifor ilate ipayment iin ithe icase iof iFG iMinter iLtd iv
iWelsh iHealth iTechnical Services iOrganization. iThe ireason ifor ithis iis ithat ia iclaim
ifor iinterest ifor ilate ipayment is itreated ias ia idirect iloss iand iexpense iequivalent ito ia
25
iclaim ifor idamages, ias idecided in iHadley iv iBaxendale, iwhich iis icodified iunder
isection i74 iof ithe iContracts iAct i1950.
Nonetheless, ithe itest iin iHadley iv iBaxendale ion iwhat ithe idamage iwas iat ia iform of
iinterest ican ibe ipaid, idepending ion iwhether iboth iparties ianticipate ithe ipossibility iof
damages iat ithe itime ithe icontract iis imade. iThis iis iabout ithe iparties' iknowledge iat
ithe time ithe icontract iis imade. iIn isuch isituations, ithe icontractor imay ibe ientitled ito
demand interest ior ifinancing icosts ifor ilate ior ioverdue ipayments iif ithe iEmployer
ibecomes aware that ithe icontractor iis irequired ito iborrow imoney. iAs ia iresult, ispecific
icontract language is ineeded ito iprovide ithe icontractor iwith ia icontractual iopportunity
ito iassert iinterest ior financing icharges.
Other ithan ithat, icontrator ican iterminate ithe icontract. Payment iwithin ithe contractually
inegotiated icontext iis inot ispecified ias i"factual" iin imost iconstruction contracts, iso
ifailure ito imake ipayment iwould inot ibe ia iviolation ithat ienters ithe contract's heart.
iFailure ito ipay ion itime iis inot ideemed ia iserious iviolation iunder icontract ilaw ito cause
iany iparty ito icancel ithe icontract. iFailure ito ipay ifor itime idue ion ianother icontract
would inot ibe iconsidered ia idenial iof iservice. iHowever, ieven ithough ilate ipayments
iare not irefused, ipayment idenials ican icontinue.
In iThe iProvisions iin ithe iStandard iForm iof iContract iwhich iis iPAM i98/PAM 2006
iStandard iForm iof iContract. iPAM i98 iprovides ifor ian iabandonment iof ithe contract by
ithe icontractor ias ia iground ifor itermination iby ithe iemployer. iTermination iunder ithe
PAM istandard iform iof icontract iby ithe icontractor iis iprovided ifor iby iclauses i26(1)
i(a) to i(c). iThe icontractor ihas ithe iright ito iterminate ihis iown iemployment iunder ithe
contract if ithe iemployer idefaults ias istated iin iClause i26.
iThe iemployer's inegligence involves failing ito ipay ithe icontractor ithe isum idue ion ithe
itemporary icertificate iduring the certificate's ivalidity iperiod. iThe inotice iwas icollected
iinto ia icontract ito igive ithe employer ia ichance ito icorrect ihis imistake iwithin ithe i7-
day iperiod. iThe iContractor ican terminate ihis iwork iunder ithe icontract iif ithe iEmployer
ifails ito ipay iwithin ithe ispecified period. iBut iin iPWD i203A iStandard iForm iof
iContract iform idoes inot iprovide ian explicit iclause iallowing ithe icontractor ito
iterminate ihis iemployment iif ithe iemployer fails ito ipay ion itime ior iat iall.
iWhen ithe icontractor ihas ian iissue iwith ithe iemployer's late ior inon-payment, ihe imay
ifile ia iclaim iunder icommon ilaw ior ithe ilaw. There iis ialso ia igeneral ilaw iprovision
26
ithat iallows ithe icontractor ito iterminate the contract iif ithe iemployer ifails ito ipay ithe
ifirst iafter isubmitting ia itemporary certificate within ithe itime iframe ispecified. iIf ithe
iemployer ifails ito ipay ithe icontractor what iis owed ito ihim, ithe icontractor ihas ithe
iright ito iterminate ithe icontract.
iIf ithe employer cannot iargue ia ireasonable idefence, ifailure ito ipay iis ia iclear iground
ifor termination. When ian iemployer ifails ito ipay ihis icontractor iwhen isubmitting ia
provisional icertificate, it iindicates ithat ithe iemployer idoes inot iwant ito ibe ibound iby
the icontract's iterms, regardless iof ihow iwell ithe icontractor ihas iperformed ihis ipart iof
the icontract.
In isection i40 iof ithe iContracts iAct i1950 i- i"Effect iof ia iparty's irefusal ito ifulfill the
ipromise iin ifull" iit iis istated ithat: i“when ia iparty ito ia icontract ihas irefused ito
perform, ior idisabled, ihimself i ifrom iperforming, ihis ipromise iin iits ientirety, ithe
promisee imay iput ian iend ito ithe icontract, iunless ihe ihas isigned, iby iwords ior
iconduct, his iacquiescence iin iits icontinuance”. iTermination iunder icommon ilaw ican
ioccur ionly when ione iparty ibreaches ithe icontract, iand isuch ibreach iis ia ibreach iof ithe
idisclaimer. A iparty iis isaid ito ireject ia icontract iif, ithrough ihis iwords ior iactions, ihe
iexpresses ihis intention inot ito ibe ibound iby ithe icontract ior ito iperform ihis iobligations.
iNormally, ithe employer's irefusal ito ipay ithe iamount ispecified iis iconsidered ia idefault,
iand ithe contractor imay itake iaction ion ithat ibasis. iHowever, ifailure ito ipay ione
iinstalment iout of ia iseries iof iinstalments iis iusually iinsufficient ito ideny.
Furthermore, iit iis igenerally iknown ithat ithere iis ino iright iof ideferment iof iwork for
inon-payment ibased ion igeneral ilaw. iThe igeneral iprinciple iis ithat ithe iContractor has
no ilegal iright ito isuspend iwork, iand ion ithe ipart iof ithe iconsultant, ihe ialso ihas ino
legal right ito iorder ia isuspension iof iwork. iOnce iconstruction iwork ihas icommenced,
ithe contractor iis iobliged ito icarry iout ithe iwork iin ian i“orderly iand idiligent” imanner
iuntil the iproject iis icompleted. i
Deferment iis ia itemporary isuspension iby ione iparty ion ithe iperformance iof itheir
obligations iunder ithe icontract ion ithe igrounds ithat ithe iother iparty iviolated ithe
icontract by ifailing ito imake ipayment iin iaccordance iwith ithe iterms iagreed ibetween
ithem. iThe suspension iis itemporary ibecause iwhere ithere iis ia iright ito isuspend, ithe
iprocedure idoes not imake ithe icontract iexpire, ibut isuspends ithe iobligation iof ithe
isuspending iparty iso that ithe ibreach ican ibe iproperly iresolved. i
27
According ito iMurdoch iand iHughes i(1996), i“it iis inot iuncommon ito ifind ithat ia
Contractor ior iSub-Contractor, iwho ihas inot ibeen ipaid iwhat iis idue, ithreatens ito
suspend ithe iwork iunder ithe icontract iuntil ipayment iis imade”. iIt ishould ibe inoted ithat
without ia iclear icontractual iright ito ipostpone ithe iwork, ithe icontractor iis inot ientitled
to ido iso ieven iif ithe iconsultant ihas ifailed ito ipay iit iwithin ithe itime ispecified iin ithe
contract. iin ithis icase, iif ithe icontractor iadjourns ithe icourt iwork, ithe icourt imay ifind
him iguilty iof irejecting ithe icontract.
Provisions iContain iin ithe iForms iof iConstruction iContract. iTheoretically, ia contractor
iis ionly ientitled ito isuspend ithe iworks ion isite ifollowing iany ilate ior inon payment iif
isuch ia iterm iis iexpressly istated iin ithe icontract. iBut ithe ivarious iconstruction contract
iforms isay iabout ithis imatter. iThere iis ithe idifferent istandard iforms iof ibuilding
contract isuch ias iPAM iform iof icontract i1998 iand iPWD i203A iStandard iForm iof
Contract. I
In iPAM iContract iForm i1998, ithere iis ino iexpress iprovision iauthorizing ithe Contractor
ito isuspend ihis iwork iwhen ihe iis inot ipaid ior ihis ipayment iwill inot iarrive on itime
iupon ireceipt iof ithe iProvisional iCertificate. iClause i25 i(1) i(ii) iand iClause i23.4 state
ithat ithe icontractor ishall iwalk iregularly iand idiligently iand ihe ishall imake ievery effort
ito iavoid iprocrastination. iThe iclause iclearly irequires ithe icontractor ito iperform well
iand icontinue iefforts ito iavoid idisruption ito ithe iprogress iof ithe iproject. i
But ithe inew iPAM i2006 icontains ia iprovision ithat igives ithe icontractor ito idefer the
iprogress iof ithe iwork iin icase ithe icontractor iencounters ia iproblem iof idelay ior inon
-payment iby ithe iconsultant. iIt iis iclearly istated iin iclause i30.7. iBut iit irequires ithe
contractor ito igive iwritten inotice ito ithe iconsultant ion ithe igrounds iof ipostponing ithe
works iuntil ithe iconsultant ipays ithe iamount idue ito ithe icontractor. iBut iin iPWD i203A
Standard iContract iForm, ithis iform iof icontract idoes inot icontain ia ispecified iprovision
that iallows ithe iContractor ito idefer iworks iif ihis ipayment iis idelayed ior ihe idoes inot
receive ipayment iat iall.
In isummary, iif ithe iamount idue iunder ithe iconstruction icontract iis inot ipaid iin full iby
ithe ipayment ideadline iand ithere iis ino ieffective inotification ito iwithhold ipayment
performance, ithe idebtor ihas ithe iright ito isuspend iperformance iof ihis icontractual
obligations. iAnother ithing ito ikeep iin imind iis ithat ithe icontractor ican ionly idefer
iwork for inon-payment iif ithe icontract icontains ia iwritten iclause iallowing ithe
28
iContractor ito do so. iAccording ito iresearch, isuch iprovisions ido inot iappear iin iall
iforms iof ilocal construction icontracts. iAt ithe isame itime, ithe istudy iindicates ithat ithe
icontractor imay be iin ibreach iof ithe icontract iif ihe ifails ito ifollow ithe iproper
iprocedures ioutlined iin the contract iwhen iattempting ia ideferral.
Moreover, ithe icontractor ican isue ithe iconsultant idue ithis iissue. iBecause icash flow iis
ithe imain iroute iof ithe imain icontractor ifor ieach iongoing iconstruction iproject, prompt
iand iexpeditious ipayment iby ithe iemployer iis ihighly iexpected. iIf ithe imain contractor
iis idissatisfied iwith ithe ipayment icertificate, ithe imain icontractor imay sue the consultant
ifor inegligence.
For iexample, iPCP iConstruction iand iL3 iArchitects ihave ibeen iappointed ias ithe
lead icontractor iand iconsultant iin ithe iconstruction iproject i(“Project”) iby ithe
ideveloper, Leap iModulation iSdn iBhd i(“Leap iModulation”). iThe iBuilding iContract
i(Private Edition with iQuantities) i1998 iwith iamendments i(“PAM iContract”) igoverns
ithe iproject. iA dispute ihas iarisen ibetween iPCP iConstruction iand iLeap iModulation
iregarding ithe inon-payment iof iinterim ipayment icertificate i(“IPC”) iNos. i17R iand i18,
iwhich iPCP Construction iseeks ito iresolve ithrough iadjudication iunder ithe iConstruction
iPayments and Adjudication iAct i2012 i(“CIPAA”). iThe iAdjudicator ihas ichosen iPCP
iConstruction i(the "Adjudication iDecision").
When ithe iAdjudication iDecision iwas iheard iin ithe iHigh iCourt, ithe iHigh iCourt
set iaside ipart iof iit ibecause ithe iAdjudicator ihad ifailed ito iconsider ithe idecision iof
ithe Jump iModule i(which icovers, iamong iother ithings, iIPC iNo.19, iwhere iL3
iArchitects allowed ia ideduction iof iRM750,000.00 ifor iworks inon-compliance) ibecause
iit iwas inot specified iin ithe ipayment iresponse. i(3) iFollowing ithat, iPCP iConstruction
ifiled ia negligent iaction iagainst iL3 iArchitects ibased ion iIPC iNo.19. iAs ia iresult iof
iL3 Architects' inegligence, iPCP iConstruction iis inow iobligated ito ipay iLeap
iModulation ia total iof iRM351,646.68 i(i.e., ireduction). iIt iis icritical ito iremember ithat
ithere iis ino contractual irelationship ibetween iPCP iConstruction iand iL3 iArchitects iat
iall imaterial times, iand ieach ihas iits iown icontract iwith iLeap iModulation.
In iMalaysia, ithe iFederal iCourt ithoroughly idiscussed iSpandeck iEngineering iin

Lok iKok iBeng i& iOrs iv. iLoh iChiak iEong i& iAnor, iwhere ithe iapex icourt iproposed
ia more irestrictive iapproach ito ithe icase iof ipure ieconomic iloss iand istated i“[45] iThe
29
imost difficult iingredient ito iprove iin iestablishing ia iduty iof icare iis ithe irequirement iof
sufficient iproximity ibetween ithe iclaimant iand ithe idefendant. iThe icourt iwould ihave ito
look iat ithe icloseness iof ithe irelationship ibetween ithe iparties iand iother ifactors ito
determine isufficient iproximity ibased ion ithe ifacts iand icircumstances iof ieach icase.
These factors iare ilikely ito ivary iin idifferent icategories iof icases. iThe ifact ithat
idamages sought by ithe iclaimant iis ipure ieconomic iloss inot iflowing ifrom ipersonal
iinjury ior idamage ito the iproperty iis ialso ia ifactor ito ibe iconsidered. iAs ihas ioften
ibeen iacknowledged, ia more irestricted iapproach iis ipreferable ifor icases iof ipure
ieconomic iloss. iAs isuch, ithe concepts iof ivoluntary iassumption iof iresponsibility iand
ireliance iare iseen ias iimportant factors ito ibe iestablished ifor ipurposes iof ifulfilling ithe
iproximity irequirement. iThe reason ifor ia imore istringent iapproach itaken iin ithe iclaims
iinvolving ipure ieconomic loss is ibecause isuch iloss imight ilead ito ian iindeterminate
iliability ibeing iimposed ion ia particular iclass iof idefendants, ithus ileading ito ipolicy
iissues.” i
Failure ito ipay ion itime iin iaccordance iwith ithe icontract iis iusually iconsidered ia
sufficient ibreach ito iauthorise ithe iother iparty ito iterminate ithe icontract. iFailure ito ipay
what iis iowed ion itime iis iconsidered ia ibreach iof idenial. iHowever, iunder iSection i56
of the iContracts iAct iof i1950, iif itime iis irequired ifor icontract iexecution, ithe icontract
imay be ivoid. iIf ithe icase iof iDawnays iv iMinter iis iheard iby ia ijudge, ithe iEmployer
imust pay ithe iContractor ithe iamount idue ion ithe itemporary icertificate iwithout imaking
iany savings ifor ithe iliquidated ior iprescribed iclaim.
30
7.0 CONCLUSION
Payment to the contractor on time must be a primary concern that the owner establishes
since late payment leads costs to surpass benefits and prevents the overall completion of the
project. So, here are some of recommendation and ideas for how to prevent a similar scenario
in the future.
1. Before beginning project execution, the owners or contributors should operate within
the budget that has been established by depositing funds into a bank account.
2. The owners can enact payment bonds in order for contractors to receive bonds and
guarantees. Owners should also pay progress payments to contractors on time because
late payments hinder the contractor's ability to fund the work.
3. It is advised that owners thoroughly evaluate bid documents such as technical
requirements, drawings, bill of quantities, and project design. This is done to prevent
disagreements and, as a result, payment delays.
4. To prevent financial difficulties, contractors should have enough cash on hand before
starting any project.
5. Contractors should send prompt, correct invoices and full documentation and
vigorously pursue payment due.
6. Consultants should review and approve concept plans, shop sketches, and the
contractor's payment plan to prevent project delays and cost overruns.
7. It can be a cost-effective way to limit payment delays without having to resort to more
formal processes like arbitration or litigation.
8. The recovery of interest on late payments is often critical for those in industry who
rely on bank funding, which has a negative impact on the profitability of construction
firms.
31
8.0 REFERENCES
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2. Government of Malaysia (2007). Title: Standard form of contract to be used where
drawings and specifications form part of the contract. Retrieve from:
http://kontrak.water.gov.my/division/qs/documenstd/203_eng_07.pdf .
3. Lee Kai Jun (2020). Title: Notice Requirement, Condition Precedents and “Loss &
Expense” Claim. Retrieve from: https://www.zainmegatmurad.com/wp-
content/uploads/2020/05/Prior-Notice-Requirement-Condition-Precedent-and-
Loss_Expense Claim_Sunissa_v_Kerajaan_Malaysia.pdf .
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20170821%20(2).pdf.
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and built environment(UM). Website:
https://ejournal.um.edu.my/index.php/jdbe/article/view/4942.
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Different Type of Condition of Contracts. Retrieve from:
https://publisher.uthm.edu.my/ojs/index.php/IJSCET/article/view/8081 .
32
8. JaneCameronArchitects. (n.d.). PROGRESS PAYMENTS DURING

CONSTRUCTION. Retrieved from https://janecameronarchitects.com/progress-
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Contributing to Project Delays.” Journal of Retail & Leisure Property 8: 225-238
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International Conference on Construction in the 21st Century, 5-7 July 2011, Kuala
Lumpur, Malaysia.
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Payment by the Employer.” Journal of Surveying, Construction & Property 1: 65-95.
18. Farhana iIsa, i(Jul i16, i2020), iPWD iStandard iForm iof iContract iPWD203A
i(Rev1/2010) iand iPAM iContract i2018. iRetrieve ifrom i:
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19. Siti iSuhana iJudi’, iRosli iAbdul iRashid i(n.d), iContractor’s iRight iof iAction iFor
iLate ior inon-Payment iby ithe iemployer. iRetrieve ifrom
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20. Ganpartnership, i(Dec i28, i2020), iThe iRight iTo iSue iA iConsultant
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34

Rmk354 Construction Law

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Rmk354 Construction Law

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SCHOOL OF HOUSING, BUILDING AND PLANNING (HBP)

RMK354 CONSTRUCTION LAW

SEMESTER 2 ACADEMIC SESSION 2020/2021

MUHAMMAD MIRZA BIN MOHAMMAD ROSSIDI 146603

NUR NAZIRAH BALQIS BINTI CHE ROZAK 146537

NUR AFIFAH BINTI RAZALI 146895

NOR ASHIKIN BINTI HISHAMUDDIN 147942

MOHAMAD ZULKIFLI BIN AMIR 146168

SUBMISSION DATE AND TIME: 7th MAY 2021

SUBMISSION: PORTAL ELEARNING

LECTURE NAME: DR. ZUL ZAKIYUDIN BIN AHMAD RASHID

3.0.1.3 Claim Documentation 8-9

4.0.3 clauses 44.0 claims for loss and expense. 16

5.0 Suggestion(s) for best practice(s) to be observed by contractor in 17

5.0.2 Impact of Late and Non-Payment 19-20

6.1 Slowing Down the Work 23

6.2 Application for Summary Judgment 23

6.3 Apply for the Winding up of Employer’s company 24

8.0 References 32-33

1.0 EXECUTIVE SUMMARY

 The contractor submits to the architect a progress claim.

3.0 REQUIREMENTS FOR PROGRESS CLAIM TO BE FOLLOWED BY A

3.0.1 Basic Requirements

3.0.1.2 Claim Notification

3.0.1.3 Claim Documentation

Effect of S.O.'s certificates

4.0 COMMON MISTAKE(S) BY A CONTRACTOR IN THE WHOLE PROCESS OF

4.1.1 Delays that occur without delivery of notice

It is common for all construction companies to use an extension of time in construction

The contractor’s request to extend time in a construction project is largely unavoidable.

c) Effect of contractor's failure to give notice of deferment.

A common problem in construction is that contractors do not understand their obligations

4.0.1.2 Based on PWD 203 Contract and PAM of Contract (2018).

In addition, changes, poor site management, inadequate site conditions, insufficient

4.0.1.3 Analysis of Case Law (Malaysia Case Report)

4.0.2.1 Based on PWD 203 of Contract and PAM of Contract (2018).

4.0.1.2 Analysis of Case Law (Malaysia Case Report)

4.0.3 clauses 44.0 claims for loss and expense

5.0 SUGGESTION(S) FOR BEST PRACTICE(S) TO BE OBSERVED BY

5.0.1 Identification of Late and Non-Payment Problem

Based on the study, contractors in Malaysia say that delays of a maximum of 5

Table A: In the building industry, a variety of factors contributed to late or non-payment.

5.0.2 Impact of Late and Non-Payment

Table B: The Effects of Late and Non-Payment

5.0.3 Late and non-payment issues could have a solution.

Table C: Possible solutions of late or non-payment issues

The steps available to the contractor in challenging the consultant are:

6.1 Slowing Down the Work

Provisions in the Standard Forms of Contract

6.2 Application for Summary Judgment

Provisions in the Standard Form of Contract

It is important to note that the arbitration provision is intended to resolve project-related

6.3 Apply for the Winding up of Employer’s company.

Provision in the Standard Form of Contract

In iMalaysia, ithe iFederal iCourt ithoroughly idiscussed iSpandeck iEngineering iin

1. Nor Azmi Bakhary (2017). Title: Improving construction claim management in

8. JaneCameronArchitects. (n.d.). PROGRESS PAYMENTS DURING

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