The circumstances allowing a contractor to apply for extension of time to complete his Works vary depending on the contract. In this article, we look at the events allowing an application for extension of time in two main standard form contracts in Malaysia, namely the PAM and the IEM contracts.
|Permitted extension of time under PAM||Permitted extension of time under IEM|
It can be seen that the PAM Contract has a more exhaustive list of incidents which would allow an extension of time to be granted. Very interestingly, delay on the part of nominated sub-contractors would constitute a delay for which an extension of time can be sought under the PAM Contract (but not under the IEM Contract).
Having a more exhaustive list would naturally favour the contractor who would have more grounds to rely upon in any application for extension of time. However, the more exhaustive list under the PAM Contract also contains instances which would be more discretionary by nature (for example, allegations of breach of contract by the Employer). This gives the contract administrator both a greater scope to exercise his powers, as well as a greater obligation to ensure that his decisions are made fairly and reasonably for both the contractor and the employer.
If the contract administrator makes a decision that is deemed to be unfair or unreasonable, that decision can be challenged and nullified. In that sense, the contract administrator would have to be careful because he can be subject to liabilities under contract and/or tort for his exercise of his duties.
Kheng Hoe Advocates
Building contract and construction contract dispute lawyers
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