Can omissions lead to a reduction of the contract period?

Variations are not only limited to additional or varied works, but oftentimes include omissions as well. When variations in the form of omissions are issued, then the contractor would have enjoyed a savings of time required to complete the works.

Question: Can that savings of time be reflected in a reduced contract period?

Under the PAM Form, it is expressly stipulated that in assessing any extensions of time, the Architect may take into account “the effect or extent of any work omitted under the Contract, provided always that the Architect shall not fix a Completion Date earlier than the Completion Date stated in the Appendix”.

Therefore, it seems clear that:

a. the contract period cannot be reduced notwithstanding omissions; BUT

b. the entitlement to extension of time can be reduced by taking into account any previous omissions (in other words, the float time has increased by reason of the omission and therefore, extensions of time may not be as critical).

How about extensions of time that have already been granted? If a contract period cannot be reduced, can a previous extension of time be reviewed and reduced in light of omissions?

Again, the answer would seem to be no. Whilst the PAM Form is silent on interim reviews, however the PAM Form provides for a final review of the Completion Date, but stipulates that “(no) such final review of extension of time shall result in a decrease in any extension of time already granted by the Architect”.

It would seem therefore that once an extension of time is granted, it is already definite and any review can only enhance the extension of time granted, not decrease it.

Kheng Hoe Advocates is a boutique firm handling CIPAA and construction disputes. Whilst based on KL, we have strategic alliances in Penang, Melaka and Johor to service our clients nationwide. A lot of disputes which we handle relate to issues surrounding time. For queries, e-mail us at khenghoe@khenghoe.com. 

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