Procedure and Effects of Delayed Possession of Site under PAM 2006

Where the Employer fails to give possession of the site to the Contractor on or before the date stated within the Contract, it is a breach of contract and, if the failure to give possession continues for any significant time, it will be a material of the contract. This is because without possession of the site the contractor cannot execute the Works under the contract. All standard forms of contract used in Malaysia including PAM 2006, provide for a specific date for possession of the site. Failure to give possession of the site is a breach not only of the express terms of a contract but also a breach of a term that would be implied at common law in the absence of such an express term.

As a result of the Employers default in giving possession of site being a material breach of the contract, a protracted failure by the Employer to give possession of site, and any subsequent acceptance by the Contractor of the Employer’s breach, may entitle the Contractor to accept the repudiation and to commence an action for damages, which could include the loss of the profit that it would otherwise have earned. (See Wraight Ltd v PH&T Holdings Ltd [1968]). In Malaysia most Contractors would balk at taking such drastic action, but they may claim damages at common law for any loss actually incurred. (more)

Collateral Warranties Explained

A collateral warranty is a contract which runs parallel, and is usually supplemental to, another contract. Usually the purpose of a collateral warranty is to create a contractual relationship between two parties where none would otherwise exist. It takes the form of a contract between the party to the underlying contract who is providing services or carrying out work and a third-party who has an interest in the proper performance of that underlying contract and, just like any contract it must be signed by the Parties to the agreement. The party giving the collateral warranty is referred to as ‘the warrantor’ and the party to whom it is referred to as ‘the beneficiary’……. more

Procedure and Effects of Delayed Possession of Site under PAM 2006

Procedure and Effects of Delayed Possession of Site under PAM 2006

Where the Employer fails to give possession of the site to the Contractor on or before the date stated within the Contract, it is a breach of contract and, if the failure to give possession continues for any significant time, it will be a material of the contract. This is because without possession of the site the contractor cannot execute the Works under the contract. All standard forms of contract used in Malaysia including PAM 2006, provide for a specific date for possession of the site. Failure to give possession of the site is a breach not only of the express terms of a contract but also a breach of a term that would be implied at common law in the absence of such an express term…..more

 

PAM 2006 EOT Processes Flowchart

PAM 2006 EOT Processes Flowchart

MALCONLAW as added a flowchart detailing the basic process in Extension of Time Applications and subsequent Determinations under the PAM 2006 Form of Building Contract. Please either search for the Flowchart using the search facility on the site or look under the PAM 2006 Contract Form from the main menu.

 

Does the Architect have power to Issue Instructions after Practical Completion?

Does the Architect have power to Issue Instructions after Practical Completion?

There appears to be no reason why the Architect should not be empowered to issue instructions after practical completion subject to certain exceptions. The PAM 2006 form of building contract permits the Architect to issue instructions in regard to any matter about which the contract expressly authorises instructions. There are many clauses and sub-clauses under the PAM 2006 form of building contract which authorise the Architect to issue instructions. Once these clauses have been identified, the question is whether the Architect’s power to issue them expires at Practical Completion….more

Must the Architect give the Contractor detailed reasons to explain an Extension of Time Determination under PAM 2006.

Must the Architect give the Contractor detailed reasons to explain an Extension of Time Determination under PAM 2006. 

Under the PAM 2006 Standard Forms of Building Contract it requires the Contractor to give notice of delay to the Works as soon as it becomes reasonably apparent. The Contractor is also required to provide details of the delaying event and its likely effect and to provide the Architect with such further information as reasonably required…..more

Extension of Time Notification and Application

Extension of Time Notification and Application

This article summarises the general steps to be taken by a Contractor in issuance of delay notices and subsequent substantiation through preparation and submission of supporting particulars commonly referred to as an Extension of Time Claim.

Experience shows that many Contractors applications for an extension to the Time for Completion fail completely or in part due ostensibly to the documentation and accompanying detailed particulars failing adequately demonstrate the Contractors entitlement as a result of a delaying event.

There are a number of elements which are essential for the contractor to clearly identify and present in the justification an Extension of Time Claim. These are discussed later but let us first address the issue of notices.

PAM 2006 contains strict notice more