BTBE 2033

BUILDING BY-LAWS, ACTS

& CONTRACT

BTBE 2033 Building by-Laws, Acts and Contracts

Lecture1
process
Lecture 2
Lecture 3
Lecture 4
Lecture 5
Lecture 6
Lecture 7
Lecture 8
Lecture 9
Lecture 10
Lecture 11
Lecture 12
Lecture 13
Week 14

Introduction to Building by-Laws, Acts and Contract

The Construction Parties & roles & Development
Standard Forms of Building Contracts
Time in Building Contracts
Payment & Variation in Building Contracts
Indemnity and Insurance
Quality & Administration Procedures
Uniform Building By-Laws (UBBL)- Space, Light & Ventilation
UBBL Building requirements & Structural requirements
UBBL Fire requirements & Construction requirement
Street, Drainage & Building Act
Town & Country Planning Act
Occupational Safety & Health Act
Environmental Quality Act
Professionals Acts; CIDB Act
Revision

BTBE 2033 Building by-Laws, Acts and

Contracts

LECTURE 1:
THE CONSTRUCTION PARTIES & ROLES &
DEVELOPMENT PROCESS

Project Team

Client

Consultants
Contractor

(Employer)

BTBE 2033 Building by-Laws, Acts and Contracts

Client (Employer)
Commissions a building project
The end user of the building (exceptions: housing
developer, property investor etc.)

Two categories of Client:

Public sector government
Private sector home-owners / commercial
companies
Client may rely solely on his Consultants to advise him
Some corporate clients have their own in-house
consultant team
BTBE 2033 Building by-Laws, Acts and
Contracts

Consultants
Engaged by the Client to provide professional services
Registered with their respective professional institutions
Advisors to the Client in a building project
Clients agents
Independent certifier in the building contract
- Architect and/or Engineers
Other Consultants:- Planner
- Quantity Surveyor
- Land Surveyor
- Landscape Architect
- Geotechnical Consultant
- Interior Designer
BTBE 2033 Building by-Laws, Acts and
Contracts

Contractor

Contractor and Employer (Client) are parties to a

building contract
Traditionally, the Contractor executes and completes
the building works in accordance with the design and
specifications prepared by the Consultants (Architect
and Engineers)
Design & Build Contractors undertake projects that
require high level of technical expertise. D & B
Contractors normally have their own in-house
consultant team to work on the design.
BTBE 2033 Building by-Laws, Acts and Contracts

Approved
ARCHITECT

C&S ENGINEER

SUBMISSION

PLANNER

Complied

Construction
AUTHORITY
Building contract
EMPLOYER
CONTRACTOR

M&E ENGINEER
LANDSCAPE
ARCHITECT

THE DEVELOPMENT
PROCESS

QUANTITY
SURVEYOR

OTHERS
INTERIOR DESIGNER
GEOTECHNICAL CONSULTANT
EIA CONSULTANT

BTBE 2033 Building by-Laws, Acts and

Contracts

LECTURE 5:
STANDARD FORMS OF BUILDING
CONTRACTS
Three common types of building contracts based on method
of remuneration:
Lump Sum Contract
Unit Price Contract
Cost Plus Contract

BTBE 2033 Building by-Laws, Acts and Contracts

Lump Sum Contract

A contract wherein the contractor undertakes to
complete the specified works for a fixed price
This type of contract is suitable if the scope of works is
sufficiently defined to allow the consultants to estimate
the project costs

BTBE 2033 Building by-Laws, Acts and Contracts

Unit Price Contract

A contract wherein the amount of the completed work is
to be measured and valued based on a schedule of
rate (unit price) for each type of materials
The final contract sum will depend on the measurement
of the quantities of materials required to complete the
works

BTBE 2033 Building by-Laws, Acts and Contracts

Cost Plus Contract

A contract wherein the Employer agrees to pay the cost
of all labour and materials plus an amount for the
Contractors overhead and profit (usually as a
percentage of the labour and material cost)
This type of contract is suitable where the scope of the
works is indeterminate or highly uncertain
Under this arrangement, complete records of all time
and materials spent by the contractor on the work must
be maintained

BTBE 2033 Building by-Laws, Acts and Contracts

Standard Forms of Building Contracts

Why Standard Form?
To facilitate the ease of contract management
To enable various parties involved in a building contract to
easily understand their rights, obligations, liabilities and
duties

Advantages:
Cost saving familiarity with their operation, limitations and
drawback.

Time saving - Savings in time and costs when standard forms

are used compared to the costs of drawing up fresh contracts
Reliability - avoiding unwarranted disputes in court or
arbitration
more balanced allocation of risk between the contracting
parties
BTBE 2033 Building by-Laws, Acts and Contracts

Types of Standard Forms of Building Contract Commonly

Used in Malaysia:
PAM Form (issued by Pertubuhan Akitek Malaysia)
IEM Form (issued by Institution of Engineers Malaysia)
CIDB Form (issued by the Malaysian Construction Industry Development
Board)
JKR (PWD) Form (issued by Jabatan Kerja Raya / Public Works Department)
Standard Forms of Building Contract Commonly Used internationally:
The FIDIC (Federation Internationale des Ingenieurs Conseils) Standard
form of Contract - UK, European and international standard
The JCT(Joint Contract Tribunal) based in London

BTBE 2033 Building by-Laws, Acts and Contracts

Private Sector
Pertubuhan Arkitek Malaysia (PAM)

PAM 2006 (previously 1998) with quantities

PAM 2006 without quantities

PAM NSC 2006

to be used for NSC where the main contract is based

upon the above

BTBE 2033 Building by-Laws, Acts and Contracts

Pertubuhan Arkitek Malaysia (PAM)

PAM 2006
Usage:

Private Sector projects

Building works

Contracts undertaken through Traditional General

Contracting Procurement
BTBE 2033 Building by-Laws, Acts and Contracts

Government / Public Sector

Public Works Department:

PWD Form 203A (Rev. 2010)

without quantities
with quantities

PWD Form 203N for Nominated Sub-Contractors

PWD Form 203P for Nominated Suppliers

PWD Form DB/T for Design & Build Turnkey Contract

BTBE 2033 Building by-Laws, Acts and Contracts

Government / Public Sector

Construction Industry Development Board:
CIDB Form for Building Contracts 2000 Edition

Standard Performa for Contract administration (for use in conjunction

with the CIDB Standard Form of Contract for building works)

CIDB Standards Form of Sub-contract for Nominated Sub-Contractor

[Form CIDB.B (NSC) /2002] (to complement the Standard Form of Contract for
Building Works.

BTBE 2033 Building by-Laws, Acts and Contracts

Private Sector
Civil Engineering Works

IEM Condition IEM.CE 1/89. Mainly for Civil

Engineering Construction (Second Reprint 1994).

IEM Condition IEM.CES 1/90.Sub-contract for use

in conjunction with the IEM Condition (First Reprint
1994).

BTBE 2033 Building by-Laws, Acts and Contracts

The Common Elements

in Standard Forms of Contracts
Scope of works
Documents and procedures
Rights and obligations of the parties
Duties of the Contract Administrator and other agents
Time for performance
Terms of payment
Standards of works, materials and workmanship
Variations
Indemnity and Insurance
Disputes
Damages
Termination
BTBE 2033 Building by-Laws, Acts and Contracts

Can we amend any clause in

a Standard Form?
Yes - because ultimately a contract is an agreement
between two parties (amendments must be
countersigned by both parties)
The normal practice to make any amendment to
use the original copy of standard form as a template
and to add, omit, substitute or revise the clause to
suit particular requirements of the parties
Caution must be taken in any amendment to avoid
creating discrepancies or inconsistencies
BTBE 2033 Building by-Laws, Acts and Contracts

Express Terms vs. Implied Terms

The clauses in the standard form will be the express
terms of a contract.
However, a standard form is not a self-sufficient
document.
Any condition not expressly provided for under the
standard form shall subject to the provisions of relevant
legislations such as the Contracts Act 1950 and the
Sale of Goods Act 1957 the implied terms of the
contract

BTBE 2033 Building by-Laws, Acts and Contracts

Classification of Contractual Terms

Conditions Essential terms of a contract; a breach
of condition will entitle the innocent party to rescind
the contract and claim for any damages suffered
Warranties Subsidiary (collateral) terms of a
contract; a breach of warranty will entitle the innocent
party to claim damages only
Innominate (Intermediate) Terms Terms which
cannot be classified as condition or warranty; the
consequence of the breach of such terms will depend
on the nature of the event to which the breach gives
rise; a serious breach will give the innocent party a
right to rescind the contract, otherwise only a remedy
in damages
BTBE 2033 Building by-Laws, Acts and Contracts

PAM Form of Building Contract

There are two editions of PAM Form:

PAM Form (With Quantities)

PAM Form (Without Quantities) used for
projects not warranting quantities as part of
the contract; without bills of quantities

Our subsequent studies will be based on the latest

standard PAM Contract 2006 (With Quantities)

BTBE 2033 Building by-Laws, Acts and Contracts

There are mainly three sections in

the PAM Form as follows:

Articles of Agreement
Conditions of Contract

Appendix

BTBE 2033 Building by-Laws, Acts and Contracts

Articles of Agreement
This section consists of:
date of agreement
the description of the works
names of Employer, Contractor, Architect, Engineer,
QS etc. (and their respective roles)
the contract sum
definitions of words
attestation (signatures of Employer & Contractor)

BTBE 2033 Building by-Laws, Acts and Contracts

Date of Contract

Employer & particulars

Contractor & particulars

Contract title / Project title

BTBE 2033 Building by-Laws, Acts and Contracts

Date of Contract

Consideration Contract Sum

Architect & particulars

BTBE 2033 Building by-Laws, Acts and Contracts

Definition of terms

BTBE 2033 Building by-Laws, Acts and

Contracts

attestation (signatures of
Employer & Contractor)

BTBE 2033 Building by-Laws, Acts and

Contracts

Conditions of Contract
There are 38 clauses in the PAM 2006 Contract as
conditions of contract which establish the contractual
relationships between the Employer and Contractor,
their respective rights, obligations and liabilities in the
contract, and the duties of the Architect (Contract
Administrator) and other agents of the Employer (e.g.
Site Staff)
Note:
There were only 35 clauses in the PAM 1998 Form

BTBE 2033 Building by-Laws, Acts and Contracts

Appendix
This section serves as a summary of the important
details of the contract, including:
Date of Commencement
Completion Date (Date for Completion)
Defect Liability Period (DLP)
Liquidated Damages
(Liquidated & Ascertained Damaged or LAD)

BTBE 2033 Building by-Laws, Acts and Contracts

Appendix

BTBE 2033 Building by-Laws, Acts and Contracts

Appendix

BTBE 2033 Building by-Laws, Acts and Contracts

Lump Sum Contract

PAM Form of Building Contract is a contract for a lump
sum, i.e. the contractor is required to complete the
specified works for a fixed sum (contract sum), subject
to adjustments if there is any variation made in
accordance with the contract.
(Original) Contract Sum + Variations = Adjusted/Final Contract Sum

BTBE 2033 Building by-Laws, Acts and Contracts

Contracting Parties

BTBE 2033 Building by-Laws, Acts and Contracts

Rights, Obligations and Liabilities

Employers Rights:
Right to deduct payment as liquidated damages for
non-completion
Right to determine the contract if breach by Contractor
Employers Obligations:
To grant unobstructed site possession
To provide sufficient information in a reasonable time
To honour certificates of payment promptly
To obtain necessary statutory approvals (e.g. building
plan approval)
BTBE 2033 Building by-Laws, Acts and Contracts

Rights, Obligations and Liabilities

Contractors Rights:
Right to uninterrupted possession of site
Right to adjust contract sum for variation order
Right to claim EOT and L/E
Right to determine the contract if breach by
Employer
To clarify scope of work, eg.. whether follow someone
elses design or own design, to clarify on limit of his work,
confirm standard of work required and quality of
workmanship or materials
right to be paid.
BTBE 2033 Building by-Laws, Acts and Contracts

Rights, Obligations and Liabilities

Contractors Obligations:

To complete the work on agreed Completion Date

Quality of workmanship and materials; adequacy &
safety of site operations
To comply with statutory requirements
To make good defects within DLP at own expense
To comply with Architects Instructions
To indemnify the Employer against 3rd party claims
To insure the works until practical completion

BTBE 2033 Building by-Laws, Acts and Contracts

Rights, Obligations and Liabilities

Contractors Liabilities:

Tortious liability to persons on site and passers-by

Liability to comply with statutory regulations e.g.
maintain public utilities, health & safety

BTBE 2033 Building by-Laws, Acts and Contracts

BTBE 2033 Building by-Laws, Acts and Contracts

Roles of consultants in PAM form of Contract

BTBE 2033 Building by-Laws, Acts and Contracts

BTBE 2033 Building by-Laws, Acts and Contracts

BTBE 2033 Building by-Laws, Acts and Contracts

Duties of Architect (under PAM Form)

Person in charge of the administration and

supervision of the contract (consistent with his
statutory duty to supervise building works)

Intermediary between Employer and Contractor

(Architect to provide information and give
instructions to Contractor as and when necessary)

Independent certifier (issuing certificates in an

impartial manner to the Contractor for interim
payments / status of works, granting extension of
time, and ascertainment of loss and/or expense)
BTBE 2033 Building by-Laws, Acts and Contracts

The Roles of Engineer & QS

(under PAM Form)
Role of Engineer

To assist the Architect with specialist engineering

works relating to structural and civil works,
mechanical and electrical works or any other
engineering works

Role of Quantity Surveyor

To assist the Architect in the measuring and

valuation of the work, materials and goods
BTBE 2033 Building by-Laws, Acts and Contracts

Revision Exercise
Study the standard PAM Form of Building Contract 2006 (With
Quantities). Try to familiarise yourself with some of the important
terms such as the following:
Contract Sum . Contract Documents
Conditions of Contract . Letter of Acceptance
Work Programme . Variation
Inspection and Testing . Site Staff . Site Agent
Practical Completion . Defects Liability Period
Making Good Defects . Indemnity
Date of Commencement . Completion Date
Non-completion . Liquidated Damages
Extension of Time . Loss and/or Expense
Determination . Nominated Sub-contractor
Certificate . Valuation

BTBE 2033 Building by-Laws, Acts and Contracts