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cece Sa RRA OEN Agreement And Conditions of PAM Sub-Contract 2006 For Use Where The Sub-Contractor Is Nominated Under The PAM Contract 2006 Al partes mst rely upon ther own sil and judgment oF upon those oftheir advisers when using tis document ‘and PAM assumes no lability to any ser or any third partyin connection with such tse. neces SoH FOREWORD ‘The Contract Review Committee was set up as a special Committee of PAM, under the Chairmanship of the late Dato’ Kington Loo, in 2000 after the PAM Form 1998 was officially launched in October 1998, Arising from the workshop organised in 2001 on the PAM Form 1998, the Contract Review Committee proceeded to work on the re-drafting of the Form. A brain-storming session was held in May 2002 to invite-input from the PAM Panel of Arbitrators, senior practitioners, members from the legal fraternity who undertake arbitration work, to invite input and comments on the issues raised from the Workshop. Over the past 4 years, the Contract Review Committee has gone through many rounds of drafting. Several workshops were held in 2003 and 2005, as part of the consultative drafting process. These workshops were open not only to PAM members but also to the public so that any organisation or person involved in the construction industry was able to attend and to voice their views. These workshops were a good forum to obiain feedback as the participants were from all sectors of the construction industry, and views expressed. have been considered by the Committee and where appropriate, have been incorporated in the drafting exercise. , ‘The core members of the Contract Review Committee are: ‘The late Ar. Dato’ Kington Loo (until March 2003) At.Tan Pei Ing, Principal of PI Architect, Ac, Jerry Sum, Director of Arkitek MAA Sdn Bhd ‘Ar, Chee Soo Teng, Senior Partner of ARC Partnership Low Khian Seng, Director of Baharuddin Ali & Low, a QS firm Co-opted members: Lim Chee Wee, Partner of Skrine Dr Colin Ong, Partner of Dr Colin Ong Legal Services, Brunei Kevin Reeves, Consultant QS Contributors Ar. Szeto Kok Yin, a Past President of PAM and Director of Al-ambia Sdn Bhd Tony Tan, Director of Al-ambia Sdn Bhd ‘Tang Juang Yew, Director of Al-ambia Sdn Bhd Steven Shee, Asst General Manager, Contract Services, of Sunway Construction Sdn Bhd N Pathmavathy, Partner of Skrine Mak Siew Fong, Director of Insurama Sdn Bhd Secretarial support Fay Cheah Loke Soo Mooi In drafting the PAM Contract 2006, the Contract Review Committee took into consideration the strengths, shortfalls and deficiencies of the existing Form, with the intention of further improving and strengthening the PAM Contract so that it can best serve the interest of the parties to the contract as well as those who are entrusted with the application. The ultimate objective is to develop the PAM Contract 2006 as the leading Form in the building and construction industry. | | | sis OTS eee OO - a ee Table of Contents Articles Of Agreement Preliminary Recttals Articles Article 1 Aatile2 Anite 3 Aice 4 Anite S Article 6 Acle7 Articles Date of agreement Paris to agreement and thei adresses [dentifcation of he Main Contact “The nature ofthe sub-contract works as prt ofthe Main Contract works, location, rawings and sub-contract bill ‘ Sub-Contractors Obigat Sub-Contract Sum Archiet Engineer uamty Surveyor : ‘Specialist Consultant Definitions Meanings Attestation/Signatories Of The Parties ‘The Sub-Contract Conditions Clause 50 Su 32 53 60 61 62 ‘Sub-Contractor And Contractor Sub-Contract pursuant to Main Contract Sub-Contractor’s knowledge of Main Contract ‘Ambiguities between the Main and Sub-Contract Sub-Contractor's Obligations (Completion of Sub-Contract Works in accordance with Sub-Contract Documents ‘Temporary works and constuction method Sub-Contractor’s design and responsibilities Discrepancy or divergence between documents Sub-Contractor's Liability Under Incorporated Provisions Of The Main Contract Sub-Conisactor compliance withthe Main Contract Sub-Contractor to discharge obligation Sub-Contactor to indemnify the Contractor Benefits Under The Main Contract ‘Sub-Contractor’s rights and benefits under Main Contract Architect's Instructions (AP) ‘Aland CAL ‘Consent by Contractor for Architect to issue Al directly to Sub-Conttactor Provisions empowering instructions ‘Sub-Contract Documents And As-built Drawings Sub-Contraet Documents ‘As-built Drawings and operation and maintenance manuals, Page ‘Table of Contents (Cont'd) ‘The Sub-Contract Conditions (Contd) Clause 10 ‘Statatory Obligations, Notices, Fees And Charges nM Statutory requirements 72 Inconsistencies with statutory requiremeais 73 Conforming to statutory obligations 74 Fees, levies and charges 80 padterials, Goods And Workmanship To Conform To Description, Testing And Inspection al Provision of vouchers , 82 Inspection and testing 83 ‘Sub-Contractor’s obligation not relieved aa Work not in acconiance with the Sub-Contract 85 ‘No compensation for time and cost 86 ‘Warranties in respect of any materials and goods 90 Royalties And Intellectual Property Rights 9. Indemnity to Contractor 92 ‘Sub-Contraion’s Labilty to pay 93 Government royalties 100 Site Agent i 101 Site Agent : 110 ‘Access To The Works i Making Site and Main Contract Works available to Sub-Contractor 2 ‘Access to Sub-Contract Works 20 Variations 1 Definition of Variation 122 Valuation rules 123 ‘Adkltional expense caused by Variation 124 ‘Access to Sub-Contractor’s books and documents Rs ‘Variations and sional expenses added to Sub-Contract Sum . Sub-Contraet Sum BI Sub-Contract Sum not to be adjusted or altered 149 Materials And Goods i “Materials and goods not to be removed 142 ‘Materials and goods paid for become Employer's property 43 ‘Warranty of ile of goods and materials 150 ‘Commencement And Completion Of Sub-Contract Works 1S Commencement nd completion of Sub-Contract Works 152 Sectional compietion tes 153 Sub-Contractoe's works programme 1a (Co-operation, order and timing for carrying out the Sub-Contract Work 185 Submission of drawings 160 Failure Of Sub-Contractor To Complete On Time et Feiluce of Sub-Contractor to complete 170 Practical Completion And Defects Liability im Practical Completion 172 Certificate of Practical Completion 173, ‘Sub-Contractor’s failure to comply with undertaking 174 Obligation to clear out on completion 175, Schedule of Defects 176 Instruction to make good Detects m7 ‘Remedial work due to Defects in the Sub-Contract Works 178. Remedial work due to Defects in the Main Contract Works 18.0 Assignment And Sub-Contracting 181 Assignment by Sub-Contractor 182 ‘No sub-contracting “4 4 4 4 “ 4 is 13 15 1s 18 16 16 16 16 16 7 ” ” ” a a 7 fie RERRSABUaaacasouabaaiaiaeaisonsvavaiscatstzassevaissarstaisleseisserstussaiscatstnsssssaiscatetuszaseaissatatnsesseaisiais “Table of Contents (Con) Page “The Sub-Contract Conditions (Con) Coane 190 Injury To Persons Or Loss And/Or Damage Of Property And Indemuity To Contractor 17 tt Stb-Ganmcto's indemnity again injry or death 0 192 —_Sab-Cantactr’s indemnity agains loss andor damage i 193 Sub-Cantactor’ indexes against cla by workmen i 194 Inomntes not ob detested : i 20.0 Insurance di 18 bo SOCSO for acl workmen i 222 Insane fo Jen! workmen at subject o SOCSO is | 203 ——_‘Warkimen's compensation isrance fr feign workers is Dod Ga insurance by Coatractr under Clause 20. ofthe Main Contact Conditions » 23 CAtRinsuance by Employer under Clause 208 or 20.C ofthe Main Contact Conditions 19 | 21 Placing of insurance with iensd Insane companies 0 . | 2.0 Extension Of Time » . | 2E1 Notation of Relevant Events eausing delay » . | 212 Architect's writen recommendation to an extension of time 1920 a 213 Appeal again Archit recommendation » a 214 Relevant Events j aoa a 213 Delay ened bythe Contractor 2122 i Bee eee eccd : 217 SubContactoro prevent del 2 | 218 Review of written recommendation of extension of time by the Architect 22 1 219 Final determination of extension of time by the Contractor 2 im a I ne Loss And/Or Expenses Caused By Matters Affecting The Regular Progress Of The Sab-Contract Works 2 i 2 Lasy andlor expense caused by matters affecting progres ofthe Sub-Contact Works, 3B 222 Access to Sub-Conractor's books and documenta 3B ' 223 Mattar materialy affecting progress ofthe Sub-Cotrct Woes : nw é 2A ——_Lossandlor expense tobe ince in cette 2 223 Breach of Sub-Conract~Sub-Contractrs lim ahas 226 Breach of Seb-Conrct~ Contactors claim 23 i 227 —_Lesandforexpene beeen th pares tobe mutallyresoived 28 i Determination Of S-Contractors Employment By Contractor 2 Defelts by Sub-Contntor 25.26 Proclure for determination 26 : Sub-Contator's insolvency 26 ' Rights and dts ofthe Conacor and Sub-Contator 2627 : Nopeyment upon determination Fa gu Records of Sub-Contract Works a a Final sccount upon deermintion 2 : Remedy ied wo damages oly n e Contractor's rights and remedies not prejudiced 28 i 249 Determination Of Own Employment By Sub-Contractor 28 ' 2A Defaults by Contactor 28 242 ——_Procedre for detention 28 243 Comactor's imoleney 2 244 ——_Righisand dues of Sub-Contactor and Contractor 28 i 243 ‘Records ofSubsContract Weeks 28 ' 246 ——_‘Setlement of ccoune > | 247 SubContacor's rights and reeds not prejiind » c 250 Determination Of Contractor's Employment Under The Main Contrast 2» ; 351 Determination of Contactor’ employment by Employer 2 ‘ 252 Determination of Contractor's employment by Contractor 29 i ‘Table of Contents (Cont'd) ‘The Sub-Contract Conditions (Cont'd) Clause 260 Certificates And Payment 26.1 Contractor to include Sub-Contractor's payment application 262 Sub-Contractor's payment 263 Sub-Contractor’s payment and Conteactor's entitlement to set-off 264 Retention Fund 265 Employer may make dect payment to Sub-Contractor 266 Payment of Sub-Contracior's Retention Fund 267 Final Account 268 lems in Final Account 269 Early final payment to Sub-Contractor 26.10 Final payment and Final Cerificate not conclusive 26.1 CConclusiveness of the Final Account 26.12 ‘Commencement of arbitration proceedings 2613 Setoff claims by Contractor 26.14 Setoff by Employer under the Main Contract 26:15 Suspension of Sub-Contract Works for non payment 26116 ‘Suspension of Main Contact Works by the Contactor under the Msi Contract 26.17 Interest 20 Genoral Attendance Upon Sub-Contractor 271 General attendance 272 Use of scaffolding 3 (Contractor and Sub-Contractor shall not wrongfully interfere 280 Adjudication 28.1 Claims and sotoff cisputes referred to adjudication 282 Notice to refer to adjudication 283 ‘Adjudication Rules 284 Decision of the adjudicator 290 Arbitration 2911 Disputes referred to arbitration 292 Powers of exbitrtor 293 Consolidation of arbitration proceedings 294 Appointment of arbitrator by Pertububan Akitek Malaysia 300 Mediation 30.1 Mediation under PAM rules 302 ‘Mediation does not prejudice the partes rights to arbitration 310 Notice an Notice 312, Notice deem served 313 Proof of Notice 314 Written communication 32.0 Performance Bond 321 ‘Submission of Peeformance Bond 322 Form ofthe Performance Bond 323 Validity of te Performance Bond 324 Foilure to extend the validity 325 Payments from the Performance Bond 326 Retum of Pesformence Bond 330 Governing Law 331 Governing Law Appendix ‘A’ To The Sub-Contract Conditions Appendix ‘BY To The Sub-Contract Conditions General Attendance (Clause 27.0) Appendix °C? To The Sub-Contract Conditions Details Of The Ape Page 2» 2» 30 30 30 30 30.31 31 32 32 32 32 2 2 3 3 3 3 3 33 3 3 33 33 3 4 a4 4 4 35 35 33 35 35 35 35 35 33 36 36 36 36 36 36 36 a” 38.39 40 40 PAM SUB-CONTRACT 2006 Articles Of Agreement This Sub-Contract Agreement ismadeon te... se Ba between. of (or whose registered office or business address is situated a). -- (hereinafter called ‘the Contractor’) (hereinafter referred to as ‘the Main Contract’) made the betwee vo 20, of (or whose registered office or business address i situated at), _ (hereinafter called ‘the Employer’) and the Contractor. Whereas ‘The Employer is desirous of (*). (hereinafter called ‘the Sub-Contract Works’) wich forms part of the Main Contract Works and has caused the following rasings (hereinafter refered to as “the Sub-Contract Drawings") and the Sub-Contrat Bills to be prepared by his Architect andor Consultan. (2) Brief desrition ofthe Main Contract Works (Brie desertion ofthe Sub- Contract Works ‘Whereas ‘The Contractor is desirous that the Sub-Contact Works should be executed by the Sub-Contractor and has accepted a tender from the Sub-Contractr for the execution and completion ofthe Sub-Contract Works. ‘The Sub-Contractor has had reasonable opportunity to examine and have full knowledge of the Main Contract (except the Setaited rates and prices). Now iti hereby agreed as follows: Article 1 In consideration of the payments to be made by the Coatractor to the Sub-Contractor a8 Sub-Contractor's hereinafter mentioned, the Sub-Contractor shall carry out end complete the Sub-Contact Obligations Works in conformity in all espects withthe provisions of the Sub-Contrat. Article2 ‘The Contractor shall pay the Sub-Contractor tho sum 6f Ringgit Malesie: Sub-Contract Sum ee (RM ) (hereinafter refered to a3 “the Sub-Contract Sum’) or such other sum as shall become payable hereunder at the times and inthe manner specified inthe Sub-Contract, Article3 ‘The term ‘the Architect in the Sub-Contrct shall meen Architect for in the event of such Person ceasing to be the Architect for the purpose of the Sub- Contract, such other Person as the Employer shall apoint within twenty eight (28) Days. theseftom, No Architect so appointed under the Main Contract shell be entitled to lsregucd or overrule any certfieate or opinion or decision or approval or instruction siven by the preceding Architect, Article 4 ‘The term ‘the Engineer’ inthe Sub-Contact shall mean: Engineer {a) Structural & Civil Engineer: Of nn (W)Mechanical & Flectrieal Engineer. Of ‘or in the event of such Person ceasing to be the Engineer for the purpose of the Sub- Contract, such other Person as the Employer shall appoiti within twenty cight (28) Days ‘therefrom, The Engineer shall perform the dutiel expected of his profession, and the Architect may from time to time delegate such duties and authority of the Architect to the Engineer asthe Architect deems fit Article 5 ‘The term ‘the Quantty Surveyor’ in the Sub-Contract shall mea...c.ese este Quantity Surveyor of. or in the event of such Person ceasing to be the Quantity Surveyor forthe purpose of the ‘Sub-Contact, such other Petson as the Employer shall appoint within twenty ight (28) Days thereftom, The Quantity Surveyor shall perform the duties expected: of his ‘profession, and the Architect may from time to time delegate such duties and authority of the Architect tothe Quant ty Surveyor asthe Architect deems fit Article 6 ‘The tecm “the Specialist Consultant in the Sub-Contract shall mean: ‘Specialist Consultant @ the Sub-Contract, such other Person as the Employer shall appoint within twenty eight (28) Days therefiom. The Specialist Consultant shall perform the duties expected of his profession, and the Architect may from time to time delegate such duties and authority of the Architect to the Specialist Consultant asthe Architect deems ft. Article 7 Inthe Sub-Contract Documents as hereafter defined, the following words and expressions shall have the meanings hereby assigned to them, except where the context otherwise requires: (2) Appendix means the Appendix tothe Sub-Contract Conditions; (©) Appropriate Authority means any stautory authority having jurisdiction over the Sub-Contract Works; © Arehitect means the Person named in Article 3 and shall be Professional Architect or any other form of practice registered under the Architects Act 1967 and approved by the Board of Atchiteets, Malaysia; (@)_—_Architect’s Instruction o- AI-as described in Clause 5.1; (©) As-built Drawings means as-built drawings for works designed (including aktemative design) by the Nominated Sub-Contactor and any other as-built ravvings required to be provided as specified inthe Sub-Contraet Documents, (Certificate of Extension of Time means the certificate issued by the Contractor under Clause 21 © Cerificate of Non-Completion means the efcificate issued by the Contractor under Clause 16.15, (i) Certificate of Practical Completion of Nominated Sub-Contract Works ‘means the certificate issued by the Architect under Clause 17.2; Clause means the clauses in the Sub-Contract Conditions; © Confirmation of Architect's instruction or CAK— as described in Clause 5.15 (6) Consultant means the Engineer, Quantity Surveyor and/or Specialist Consultant 1s appropriate; @ Contractor means the party named in the Articles of Agreement and includes the Comtactor’s egal successors or personal representatives or any Person #0 ‘hom the Fights and obligations of the Coftractor have been transferred with the agreement of the Employer; (m) Contractor's All Risks Insurance (CAR Insurance’) means an insurance policy which provides cover against all risks specified inthe Main Contact, (1) Day means calendar day including the weekly day of rest but excluding gazeted holidays in the location where the Sub-Contract Works is eacried out; (©) Defects means defects, shrinkages or other faults due to materials or workmanship sot in accordance with the Sub-Contract and/or de to feulty ‘design (if any) undertaken by the Sub-Contractor; (©) Defects Liability Period means the petiod stated inthe Appendix ‘C"; (@ Employer means the party named in the Aticles of Agreement in the Sub- CCortract and the Main Contract and ineludes the Employer's legal successors oF Personal representatives or any Person to whom the rights and obligations of the Employer have been transferred, (Engineer means the Person named in Anicle 4 and shall be a Professional Engineer or any other form of practice registred under the Registration of Engineers Act 1967 and approved by the Board of Engincers, Malay (©) Final Account means the documents showing the adjustment of the Sub: Contract Sum issued under Clause 26.73 Definitions 0 ) oo ow 6) 0 @ (a) (aby ao) (aa ee) a ) (ah) «i i) ag @ ex) Force Majeure means aay ciscumstanees beyond the control of the Sub- Contractor caused by terrorist ats, governmental or regulatory action, epidemics and natural disasters; Interim Certificate means the progress payment ourificate issued by the ‘Architect under Clause 30.1 of the Main Contract Conditions; Letter of Appointment means the letter ftom the Contactor 10 the Sub- CConteactar ascopting him as the Nominated Sub-Contractor; Main Contract means the agreement betwee the Employer and Contractor; Main Contract Conditions means the conditions ofthe Main Contact; ‘Main Contract Works means tho works described in the Main Contract; ‘Month means calendar month; Performance Bond means the bond required to be provided by the Sub- Contactor as a security for the due performance of the Sub-Contract under Clause 32.1; Period of Honouring Certificates means the period for honouring certifiates stated in the Appendix under Clause 30.1 of the Main Contract Conditions; Person means an individu, sole proprietorship, fim (partnership) or body corporat Practical Completion or Practically Completed means the stat of completion

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