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)

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Access to Site and Site Possession – Explained

1) Access to Site

Depending on the precise wording of the Conditions of Contract the term or phrase Access to Site can have a number of meanings or interpretations. Normally Access to Site refers to the means and availability of the Contractors approach to the Site as defined in the Contract. It may also mean the ability to occupy the Site which is commonly referred to as Site Possession or Possession of the Site.

Firstly we will consider Access to the Site on which the Works are to be constructed. Access to the Site is necessary to allow the transportation and delivery of construction materials, plant, labour and equipment as well as to allow the installation and connection of utility services necessary for construction and indeed operation of the completed………(more)

2)   Site Possession

The term possession or use or occupation is contained within many standard forms of contract to describe the Contractors right to enter the Site, occupy and use the Site and carry out the specified Works. During the Contract Period, possession will usually provide the Contractor with such exclusive occupation and use the Site as required to construct the Works. At the end of the Contract Period, the Contractor may require partial occupation of the Site to carry out performance tests. In this case the Contractor use will usually override the Employers operation or use of the facility to conduct such tests. During the defects correction period, the Contractor will usually only require….. (more)