vii
TABLE OF CONTENTS
CHAPTER
TITLE
TITLE
i
DECLARATION
ii
DEDICATION
iii
ACKNOWLEDGEMENTS
ABSTRACT
iv
v
ABSTRAK
vi
TABLE OF CONTENT
1
PAGE
vii
LIST OF CASES
xi
LIST OF ABBREVIATIONS
xiii
LIST OF TABLES
xiv
LIST OF FIGURE
xv
LIST OF APPENDIX
xvi
ORGANISATION OF THE THESIS
1.1
Background Study
1
1.2
Problem Statement
3
1.3
Objective
5
1.4
Scope of Study
5
1.5
Significant of the research
6
1.6
Research Methodology
6
1.6.1
Stage 1: Initial Study
7
1.6.2
Stage 2: Data Collection and Data Recording 7
1.6.3
Stage 3: Data Analysis
8
1.6.4
Stage 4: Writing Up
8
viii
1.7
Organisation of the Chapters
8
1.7.1
Chapter 1: Introduction
9
1.7.2
Chapter 2: Delays and Extension of time
9
1.7.3
Chapter 3: Loss and Expense
9
1.7.4
Chapter 4: Assessment for Loss and Expense
in prolongation cost under preliminaries item 10
1.7.5
2
10
DELAYS AND EXTENSION OF TIME
2.1
Introduction
12
2.2
Delays in construction contracts
13
2.3
Cause of Delay
17
2.3.1 Delays caused by neutral events
17
2.3.2 Delays Caused By the Owner/Employer
18
2.3.3 Delays Caused By the Contractor
19
Types of Constructions Delay
19
2.4.1
Critical versus Non-critical Delays
20
2.4.2
Excusable versus Non-Excusable Delays
21
2.4.3
Compensable Delays versus Non-Compensable
2.4
2.4.4
2.5
3
Conclusion and Recommendations
Delays
23
Concurrent Delays
23
Extension of time
24
2.5.1
Purposes of extension of time provisions
25
2.5.2
Extension of time clause in contracts
26
2.5.3
Grounds for extension of time
31
2.6
Relationship to claims direct loss and expense
32
2.7
Conclusion
33
LOSS AND/OR EXPENS
3.1
Introduction
35
xi
3.2
3.3
3.4
Definition of Loss and/or Expense
36
3.2.1 Contract Act 1950
37
3.2.2 Standard Forms Provisions
38
3.2.3 Loss and Expense by Common Law
39
Direct loss versus indirect loss
40
3.3.1
Direct Loss
43
3.3.2
Indirect Cost or Consequential Loss
45
Claims for Loss and Expense
48
3.4.1
Provisions in Standard Forms of Contract
51
3.4.1.1 PWD 203/203A (Rev. 1/2010)
52
3.4.1.2 PAM Contract 2006
(with/without quantities)
3.5
Conditions Precedent to Recovery of Loss and
53
55
Expense Claims
3.6
Potential Head of Claims
58
3.7
Quantification Heads of Claims
62
3.7.1
On site establishment costs.
64
3.7.2
Head office overheads
64
3.7.3
Loss of Productivity
68
3.7.4
Interest and Finance Charge
69
3.8
4
Conclusions
71
ASSESSMENT FOR LOSS AND/OR EXPENS DUE TO
EXTENSION OF TIME FOR PRELIMINARIES ITEMS
4.1
Introduction
73
4.2
Substantiation of Claims
74
4.3
Case Studies
76
4.3.1 Background Project
76
4.3.2 Assessment by Client for Loss and/Or Expense79
4.3.2.1 Notice Requirement
80
4.3.2.2 Contractors Claims
82
4.3.2.3 Valuation By SO
83
x
4.4
Common practice in additional preliminaries
Assessment
86
4.4.1
On-Amended Contract Basis
86
4.4.2
On Formula Basis
87
4.4.3
On-Negotiation / Agreement Basis
89
.
4.5
5
Conclusions
90
CONCLUSION AND RECOMMANDATION
5.1
Introduction
91
5.2
Summary of Research Findings
91
5.3
Further Studies
93
References
Appendix 1
Appendix 2
xi
LIST OF CASES
CASE
PAGE
Alfred McAlpine Homes North Ltd. V. Property & Land
Contractors Ltd. (1995) 76 BLR 65.
65
Bremer v VandenAvenneIzegem P.V.B.A [1978] 2 LLR 109
55
British Sugar plc v NEI Power Projects Ltd, [1997] 87 BLR 42
47
Bruno Law v. US, (1971) 195 Ct C1 370
74
City Inn v Shepherd Construction, (2003) CILL 2009
56
Codelfa Construction Party Ltd v State Rail Authority of
New South Wales (1982) CA 24149 CLR 337
18
Fairweather v. Wandsworth, (1987) 39 BLR 106
33,34
F.G. Minter Ltd v Welsh Health Technical Services Organization
(1980) 13 Build LR 1. p 9
40,62,69
Finnegan v. Sheffield City Council (1988) 43 BLR 124.
65,66,67
Gaymark Investments Pty Ltd. V Walter Construction Group [1999]
56
Henry Boot Construction Ltd v Central Lanscshire New Town
Development Corporation(1980) 15 BLR 1.
Hadley v Baxendale (1854) 156 ER 145
14
39,40,41,42,70,71,72
Holme v Guppy, (1838) 3 M& W 387,
26
Joseph Constantine Steamship Line v. Imperial Smelting
Corporation Ltd. [1942] AC 154 at 174 per Viscount Maugham.
Koufos vCzarnikow Ltd. (The Heron II) [1969] 1 AC 350.
49
42
Mc Cain Foods (GB) Ltd v Eco – Tec (Europe) Ltd
Limited [2011]EWHC 66 (TCC)
47
xii
Merton v. Stanley Hugh Leach, (1985) 32 BLR 51
74
Millar's Machinery Co Ltd v David Way and Son
[1935] 40 Com Cas 204
45,46
Multiplex Construction v Honeywell Control System,
(No.2) [2007] EWHC 447 (TCC)
56
Murdoch v Luckie (1897) 15 NZLR 296
31
Ogilvie Builders Ltd v City of Glasgow District Council,
(1994) 41 Con LR 1
70
Peak Construction (Liverpool) Ltd v McKinney Foundations Ltd.
(1970) 1 BLR 11
31,75
Percy Bilton Ltd v Greater London Council(1982) 20 BLR 1.
14
Rapid Building v Ealing Family Housing Associations(1984) 29 BLR 5
26
Saint Line Limited v Richardsons, Westgarth& Co., Limited
[1940] 2 KB 99. p4
44,45,46
Tate & Lyle Food and Distribution Ltd v Greater London
Council and another, 8 [1982] 1 W.L.R. 149
68,69
Whittal Builders CO Ltd v Chester-Le-Street District Coucil
40 Build LR 82
‘Wraight Ltd v P.H & T. (Holdings) Ltd, 13 Build LR 26
69
39,40
Victoria Laundry (Windsor) v. Newman Industries, Coulson & Co.
[1949] 1 ALL ER 997 at 1002 per Asquith LJ
41
xiii
LIST OF ABBREVIATIONS
BLR
-
British Law Reports
MLJ
-
Malaysian Law Journal
SMM
-
Standard Method Of Measurement
PAM
-
PertubuhanArkitek Malaysia
PWD
-
Public Work Department
SO
-
Superintending Officers
Cl
-
Clause
AC
-
Appeal Cases, House of Lords
All ER
-
All England Law Reports
BuildLR
-
Building Law Reports
Ch
-
Law Reports: Chancery Division 1991-
CLJ
-
Current Law Journal (Malaysia)
Con LR
-
Construction Law Reports
CSOH
-
Outer Hose, Court of Session
ER
-
Equity Reports
Exch
-
Exchequer Reports
HL
-
House of Lords
Hudson
-
Hudson Law Reports
xiv
LIST OF TABLES
NO.
Tables
Page
4.1
Reason of extension of time
77
4.2
Items Claim By Contractor and Valuation by SO
82
xv
LIST OF FIGURE
NO.
Figures
Page
1.1:
Research Methodology
11
2.1:
Consequences of Delay – An Overview
16
2.2:
Delay Categories ( Trauner, 2009 )
22
2.3:
Extension of Time: Contractual Provisions
28
4.1:
Contractors Formula
83
4.2:
Pro rate formula for waters for workers
84
4.3:
Calculation of Insurance
85
xvi
LIST OF APPENDIX
NO
APPENDIX
1
CLAIM BY CONTRACTORS VS VALUATION
BY
2
SO FOR LOSSES AND EXPENSES
PRELIMINARIES ITEM CLAIMS BY CONTRACTOR
VS VALUATION BY SO
PAGE
94
95