Transactions on Science and Technology Vol. 10, No.

3, xx - xx, 2023

1 Unveiling the Root Causes and Consequences

2 of Project Delays and Litigation
3 Challenges in Sabah
4 Malik Fahad1,
5 Habib Musa Mohamad2,
6 Muhd Fauzy Sulaiman3,
7 1,2,3, Faculty of Engineering, Universiti Malaysia Sabah, Jalan UMS, 88400 Kota Kinabalu, Sabah, MALAYSIA
8 #Corresponding author. E-Mail: corresponding author’s email; Tel: +6088-320000; Fax: +6088-435324.
9
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10 ABSTRACT The construction industry, inherently intricate and multifaceted, assumes a critical role in the progress of
11 Sabah, Malaysia. Effective communication stands as the cornerstone of successful project execution in this domain.
12 However, the absence of clear communication often precipitates project delays, escalated costs, and disputes culminating
13 in complex legal challenges. This research delves into the intricate landscape of communication breakdowns, their root
14 causes, and the subsequent far-reaching consequences on construction projects in Sabah. Gathering qualitative insights
15 from in-depth knowledge about previous court cases and quantitative data derived from a structured survey, this study
16 seeks to dissect the contributing factors to communication disparities, which propel project delays and eventual legal
17 entanglements. By systematically analyzing amassed data and juxtaposing it with relevant case precedents, this research
18 aims to unveil the pivotal nexus between miscommunication, project delays, and ensuing litigation.
19 The study draws on a plethora of academic literature, industry reports, and practical instances, exemplified by the Federal
20 Court ruling in United Project Management (M) Sdn Bhd v. Southern Builders (J) Sdn Bhd (2003) and another confidential
21 case of bankruptcy. These pivotal cases underscored the applicability of the Construction Industry Payment and
22 Adjudication Act (CIPAA) to disputes in construction contracts. The research strives to not only unravel communication
23 challenges but also provide actionable insights for stakeholders to implement proactive communication strategies.
24 Ultimately, this study aspires to offer a holistic framework for stakeholders to navigate communication intricacies, thereby
25 mitigating project delays and preempting the legal complexities that often ensue. Through an amalgamation of theoretical
26 underpinnings, real-world evidence, and expert perspectives, this research endeavors to enrich the discourse on
27 communication within Sabah's construction industry, contributing to its advancement and improved project outcomes.
28 KEYWORDS: Ineffective communication; Root causes; Court cases; Litigation challenges; arbitration.
29 Received xxxxxx Revised xxxxxx Accepted xxxxxx In press xxxxxx Online xxxxxx
30 © Transactions on Science and Technology
31
32 INTRODUCTION
33
34 The construction industry in Sabah, Malaysia, is experiencing a paradigm shift due to rapid
35 urbanization and technological advancements, leading to increasingly intricate projects involving
36 various stakeholders, including clients, consultants, and contractors (Gamil & Abdul Rahman, 2018).
37 Effective communication has emerged as a pivotal factor in addressing the challenges posed by this
38 dynamic landscape, ensuring the attainment of successful project outcomes. However, scholarly
39 research has consistently highlighted that deficient communication during the project lifecycle can
40 culminate in project delays and, in severe instances, project failure (Chan & Kumaraswamy, 2010;
41 Baiden et al., 2016).
42
43 This study aims to delve into the intricate fabric of communication within construction projects in
44 Sabah and scrutinize its ramifications on project performance and legal ramifications. As the
45 construction industry continues to evolve, the need for seamless communication among diverse
46 project teams, each harbouring distinct roles, and responsibilities, becomes increasingly
47 indispensable (Acharaya et al., 2006). Miscommunication, particularly concerning contractual terms
48 and obligations, has been shown to yield disputes and even litigation, thereby underscoring the
49 paramount importance of lucid, effective communication (Yang, 2012).
50

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51 In the realm of construction contracts, three pivotal components include Bill of Quantities
52 (BOQs), Technical Specifications, and Project Drawings, each bearing unique significance for both
53 parties involved (Yang, 2012). However, miscommunication surrounding these contract elements
54 has been demonstrated to precipitate disputes and arbitration processes (Acharaya et al., 2006). This
55 research endeavours to investigate into the root causes and far-reaching consequences of such
56 miscommunication, shedding light on its profound impact on project health and its potential to
57 trigger legal complexities.
58
59 By comprehensively examining the fundamental causes of communication breakdowns and their
60 repercussions within construction projects, this research seeks to offer invaluable insights to both
61 industry practitioners and policymakers. The exploration of the roles played by pertinent
62 regulations and guidelines, such as the Construction Industry Payment and Adjudication Act
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63 (CIPAA) and the best practices advocated by the Construction Industry Development Board (CIDB),
64 will provide a holistic perspective on how effective communication can be fostered (CIDB, 2017).
65 Ultimately, this study aspires to optimize project management strategies, mitigate potential risks,
66 and pave the way for streamlined and triumphant construction projects in the Sabah region.
67
68
69 LITREATURE REVIEW
70
71 Miscommunication is a pervasive challenge within the construction industry, arising from
72 breakdowns in information exchange among stakeholders like clients, contractors, and consultants
73 (Shen et al., 2021). Such failures can encompass inadequate data sharing, misinterpretation of
74 technical or financial details, and ambiguity in role assignments. The repercussions of
75 miscommunication can be profound, causing project delays, errors, budget overruns, and even legal
76 conflicts among stakeholders (Yu et al., 2018). The multifaceted nature of construction projects
77 involving various stakeholders increases the complexity of communication breakdowns. Addressing
78 this issue is crucial for successful project outcomes.
79
80 The main purpose of communication in this industry is to share or inform ideas, opinion for
81 desired action and facts between all involved parties. In this process the required information must
82 be transparently communicated to the receiver without confusion and misunderstanding (Lee &
83 Kim, 2018). By building constructive feedback loops effective communication not only helps to
84 improve the management it also helps to strengthen the team and their confidence. In the result
85 these factors help to reduce the construction time, help to reduce the budget and safety of project.
86 Sometime in projects contractually driven relationship can lack of mutual respect for each other due
87 to ineffective communication. If there is lack of communication and misunderstanding in the project
88 can lead to several costly problems during the project life cycle (Lee & Kim, 2018).
89
90 Generally, there are two main types of delays which are Inexcusable delay and Excusable delay
91 (Banerjee, 2022). Inexcusable delays are mostly from the contracted side, in some cases the contractor
92 can claim but and, in some cases, additional cost is to be paid by the contractor party and mostly
93 must pay for liquidity damages. On the other hand, excusable delays such as due to weather
94 condition or any other reason from owner’s side can lead to extension of time EOT (Banerjee, 2022).
95 In excusable delays it’s easier for contractors to get the claims and contractors are excused from
96 liabilities as well. In construction projects disputes mainly occur in inexcusable delays and that lead
97 to complicated litigation and arbitrations.
98

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99 During the year 2020 Spring Energy Sdn Bhd had an issue of payment with Maju Holdings
100 Sdn Bhd. In this case Spring Energy Sdn Bhd commenced and action against the defender Maju
101 Holding Sdn Bhd for sums due from Payment certificate 22 and 23 was held in session court (Wong,
102 2021). The plaintiff has proven in court that those payments certificates have no issue in their
103 element’s clarity, incontrovertibility and have been finalized clearly. The judgment was in favor of
104 the contractor and defendant was ruled to pay the sums (Wong, 2021). As per details of case if there
105 was lack of communication from both parties on mentioned case. If communication was done
106 properly and things were being verified there was minimal chances that it was going to lead to
107 court.
108 Conflicts, Causes and Effect
109 Conflicts are the part of a construction projects that effects project estimated cost, completion
110 time, reduce productivity and reduces the project profit, it can have many causes that are sometimes
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111 anonymous, most of the disputes begins when there is the difference. Most of the time it is
112 considered that the poor management at the site is the main reason behind the major conflict.
113
114 Contractors for granting extension of time have taken the first step to identify a problem,
115 investigate and find possible solutions. Prior to the usage of S-Curve analysis the root cause of delay
116 was firstly identified, secondly analysis of manpower and thirdly monitoring by the use of financial
117 S-curve. The S-curve is used in generation of reports to developer team, for warning strength of
118 team and for visualizing the progress of the project of time (Mohamad et al., 2021).
119
120 Table 1: below illustrates the causes that are responsible for the delay in the project that includes
121 16 major points (Mohamad et al., 2021).
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144 It was contractually decided to hand over the whole project in 2015, but by December 2014 just
145 after passing 21 months of project, it was observed that the project is behind the schedule 5.96 factor
146 behind at 80.47 % of schedule. By this time, it was contractually decided to have an actual progress
147 of 74.78%(Mohamad et al., 2021).

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148
149 Construction laws and regulations:
150 The following laws and contracts are considered to study the impact of communication in the
151 construction industry. As in survey in depth knowledge about these laws is checked in people who
152 are involved in construction industry. As due to the limitations of research only these following laws
153 are considered for this project.
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155 • Construction Industry Development Board (CIDB).
156 • Construction Industry Payment and Adjudication Act 2012 (CIPAA) was introduced in
157 2012 and has been enforced in the construction industry since 15th April 2014.
158 • The Pertubuhan Akitek Malaysia (PAM) -Agreement and conditions of PAM Contract
159 2018 (With Quantities)
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160
161 RESERCH OBJECTIVE
162 The objective of this research endeavor is to assess unveiling Roots, Causes and Consequences
163 inefficient communication in construction projects, particularly its role in fostering complex
164 litigation and arbitration. The research objectives are outlined as follows:
165
166 • To investigate the underlying reasons and repercussions associated with insufficient
167 communication within project management.
168 • To exemplify the factors contributing to delays in the scrutiny of Interim Payment
169 Applications (IPA) and payment-related concerns, subsequently leading to arbitration.
170 • To dissect prevailing legal disputes stemming from ineffective communication, aligning
171 them with established legal statutes, and devising enhanced strategies to facilitate
172 effective communication.
173
174 RESERCH SCOPE
175 In this study the following scope will be covered.
176
177 • This research will mainly focus on the causes of ineffective communication and what are
178 the effects of that on the project life cycle.
179 • Issues related to the Private Construction Project with (CIDB) G5 and above category (Rm
180 5 million or more) will be Evaluated.
181 • What are the sources of delays in IPA verification due to ineffective communication and
182 how conflict over nonpayment claims can lead to Arbitration.
183 • How discriminations of contract can lead to management issues and legal concerns that
184 involves local authorities.
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197 METHODOLOGY
198 This chapter outlines the methodology adopted to explore the root causes and consequences of
199 miscommunication in Sabah's construction industry. A mixed-method approach, combining
200 qualitative surveys and extensive desk research, was used.
201
202 Waterfall Methodology:
203
204 This sequential project management approach includes phases like requirements gathering,
205 analysis, design, implementation, testing, deployment, and maintenance. It guided the research
206 process. Following are the stages of Waterfall Methodology:
207 • Plan: Defined research questions and objectives based on a literature review, identifying
208 the research gap.
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209 • Design: Developed a research plan, including survey and interview questions.
210 • Data Collection: Conducted surveys and interviews, collected relevant data.
211 • Data Analysis: Analyzed data for patterns and trends.
212 • Reporting: Presented findings and recommendations.
213 • Review: Evaluated the research process and its implications.
214
215 Case study
216
217 Two distinct cases were selected to examine the consequences of ineffective communication
218 in construction projects leading to complex litigation and arbitration. The first case involved a
219 dispute between United Project Management (M) Sdn Bhd and Southern Builders (J) Sdn Bhd,
220 emphasizing the miscommunication of contract documents and its repercussions. This case
221 dissected the dispute, including contract interpretation and compensation assessment during
222 arbitration. The second case centered on a confidential dispute between Company A (Contractor)
223 and Company B (Client). Contract termination, exacerbated by payment and bankruptcy issues due
224 to miscommunication, led to a legal dispute. These cases underscore the critical role of effective
225 communication in avoiding such complications. To complement the case studies, a structured
226 survey gauged stakeholders' perceptions and experiences within the construction industry, seeking
227 insights on how miscommunication instigates disputes and leads to legal conflicts and arbitration.
228 This research aims to comprehensively explore the multifaceted dimensions of ineffective
229 communication's impact on construction projects, including complex legal entanglements and
230 arbitration proceedings.
231
232 Survey
233 To gather quantitative data on the impact of ineffective communication in construction projects
234 and its relation to complicated litigation, we designed a structured self-administered questionnaire
235 consisting of closed-ended and open-ended questions. It was tailored for individuals associated with
236 Sabah's construction industry and aimed to address the research objectives of this project.
237 Participants:
238 The survey targeted construction professionals in Sabah, Malaysia, including project managers,
239 engineers, quantity surveyors, and legal experts. Participants had at least one year of experience and
240 worked on projects exceeding CIDB G5 category (RM 5 million and above). Participation in
241 arbitration or litigation related to construction projects was optional, and participants' knowledge of
242 communication processes and contract forms used in Malaysia was assessed.
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246 Table 2: Survey structure summary of objectives with different sections.

Section Title Description
1 Demographic Information Collecting background data for context.
2 Causes of Explore factors causing ineffective
Miscommunication communication. Rate familiarity, cultural
impact, channels, and conflict frequency.
3 Impact of Assess consequences on delays, costs, quality,
Miscommunication arbitration, and project adherence.
4 Disagreements due to Investigate conflicts from communication
Miscommunication breakdowns. Rate knowledge of legal aspects.
5 Legal Concerns due to Understand legal implications. Rate knowledge
Miscommunication of contract terms and legal awareness.
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6 Court Cases Examples of Gather real cases. Rate agreement with

Miscommunication miscommunication leading to disputes.
7 Importance of Effective Measure communication's significance. Rate
Communication solutions, protocols, and visual aids.
Lastly Additional Solutions Open-ended question for industry
open improvement suggestions.
ended
247
248 Analysis
249 To conduct the analysis for this research, you will employ both quantitative and qualitative
250 methods. The quantitative aspect will involve the statistical analysis of survey data, including
251 calculating frequencies, percentages, and potentially using inferential statistics to identify significant
252 relationships or patterns. This statistical analysis will allow you to quantify the prevalence of
253 miscommunication issues, their impacts, and participants' perceptions.
254 On the other hand, the qualitative analysis will focus on the case studies and open-ended survey
255 responses. Here, you will use thematic analysis to identify recurring themes, patterns, and insights
256 from the qualitative data. Thematic analysis will help uncover the nuanced aspects of
257 miscommunication in the construction industry and provide a deeper understanding of the issue.
258 By combining these quantitative and qualitative approaches, you will achieve a comprehensive and
259 multifaceted analysis of the impact of ineffective communication in construction projects, shedding
260 light on the root causes and potential solutions to mitigate these challenges.
261
262 RESULT AND DISCUSSION
263 In the initial survey results for Objective One, responses were gathered from four main parties
264 involved in construction projects. Clients accounted for 22% of the total responses, while consultants
265 contributed 28%. The majority of responses, totaling 44%, came from contractors. Additionally, there
266 was a 6% contribution from other stakeholders within the construction industry. These percentages
267 reflect the varying levels of participation and input from different parties, allowing for a
268 comprehensive examination of communication issues from multiple perspectives within the
269 construction sector. Overwhelmingly, 99.18% of surveyed construction stakeholders concur that
270 miscommunication can lead to project delays, while a mere 0.88% hold an opposing view.
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291 Figure 1: Roles in construction of parties involved in survey.
292
293 Among the factors contributing to communication issues in Sabah, Malaysian construction projects,
294 differences in work practices hold the highest share at 26.8%. This is followed by a lack of
295 communication protocols at 25.4%. Other significant factors include language barriers at 18.6%,
296 technological limitations at 14.1%, and cultural differences at 12.4%. Only a minor percentage, 2.5%,
297 attribute communication issues to other factors not listed here.
298 Ineffectual communication in construction projects has multifaceted repercussions, as revealed by
299 the respondents. A significant 25.62% believe it impacts all listed aspects, emphasizing its far-
300 reaching consequences. Specifically, 23.97% assert that it causes delays in project completion,
301 demonstrating a substantial impact. Additionally, 21.07% highlight conflicts between stakeholders
302 as a prominent outcome, while 16.53% identify increased project costs. Surprisingly, a noteworthy
303 11.57% connect ineffective communication with arbitration and litigations. This situation parallels
304 the international landscape, as studies emphasize the pervasive impact of poor communication on
305 construction projects. (Smith & Tan, 2021; Lee, 2019), as per their research Malaysia's construction
306 sector, differences in work practices (26.8%) and the absence of communication protocols (25.4%) are
307 key contributors to communication issues. These findings reflect the diverse and substantial
308 influence of communication quality on construction endeavors.
309 The following table presents a summarized perception analysis from survey responses by
310 different stakeholders in the construction industry. It reflects their viewpoints on the impact of
311 miscommunication across various aspects of construction projects in Sabah, Malaysia. These
312 perceptions provide valuable insights into the communication challenges faced within the industry,
313 highlighting areas where effective communication practices are crucial to improving project
314 outcomes and minimizing disputes.
315 Table 3: Analysis of survey results on different aspects of miscommunication.

Question Client Consultant Contractor Others

Familiarity with Effective Communication High High High Low
Frequency of Disagreements due to Low High Low Low
Miscommunication
Encounter Technical Issues due to Low Low Low Low
Miscommunication
Miscommunication Leading to Delays High High High High
Miscommunication Leading to Disputes/Conflicts High High High High

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Miscommunication Leading to Increased Costs Low Low High High

Impact on Quality of Final Deliverables High High High High
Miscommunication Leading to High High High High
Litigation/Arbitration
Impact on Project's Schedule, Scope, High Low High High
Requirements
Difficulty in Resolving Legal Disputes Low Low Low Low
316 Weighted Average Perception: Client - 3.932, Consultant - 3.922, Contractor - 3.994, Other -
317 3.886
318 The table reflects high awareness among clients, consultants, and contractors about the
319 detrimental effects of miscommunication on project timelines, quality, costs, and legal conflicts.
320 Notably, stakeholders generally acknowledge the heightened significance of effective
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321 communication practices in achieving successful project outcomes. These insights underscore the
322 critical need for improved communication protocols within the industry to mitigate potential
323 disputes and enhance project efficiency. A study conducted by (Smith, Brown, & Johnson, 2020) in
324 the United States construction sector, stakeholders across the board acknowledged that
325 miscommunication significantly contributes to project delays, increased costs, and disputes.
326 It reveals that stakeholders generally recognize the adverse consequences of miscommunication,
327 with a heightened awareness of its impact on project schedules, quality, costs, and legal disputes.
328 These findings underscore the urgent need for enhanced communication practices and protocols
329 within the industry to mitigate potential issues and improve overall project efficiency.
330
331 CONCLUSION
332 The comprehensive analysis of communication issues within Malaysia's construction industry
333 underscores the critical need for effective communication protocols. These findings carry significant
334 implications for stakeholders, project efficiency, and the avoidance of disputes.
335 • Survey results represent diverse perspectives from Malaysian construction stakeholders,
336 highlighting the widespread consensus (99.18%) that miscommunication causes project
337 delays.
338 • Key contributing factors to communication issues include differences in work practices
339 (26.8%) and the lack of communication protocols (25.4%), underscoring the need for
340 improvement in these areas.
341 • Ineffectual communication's repercussions are substantial, impacting all aspects
342 examined, including delays (23.97%), conflicts (21.07%), increased costs (16.53%), and
343 even legal disputes (11.57%).
344 • Stakeholders across roles acknowledge the adverse consequences of miscommunication,
345 emphasizing the urgency of enhancing communication practices and protocols within
346 Malaysia's construction industry.
347 All in all, fostering a culture of effective communication is not merely advantageous but
348 imperative for the sustainable success of construction projects in Sabah, Malaysia.
349
350 ACKNOWLEDGEMENT
351 I would like to express my deep appreciation to my supervisors, Ir. Ts. Dr. Habib Musa Mohamad
352 and Muhd Fauzy Sulaiman, for their unwavering guidance and support throughout my research. I
353 am also grateful to Universiti Malaysia Sabah (UMS) for their resources and mentorship.
354
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