Arbitration & Adjudication

Arbitration is a popular alternative dispute resolution method in Malaysia. It is governed by the Malaysian Arbitration Act 2005 (Act 646) which is based on the UNCITRAL Model Law on International Commercial Arbitration.

Arbitration is commonly used in Malaysia to resolve disputes in various industries such as construction, engineering, oil and gas, and shipping. Parties may choose to refer their disputes to arbitration by including an arbitration clause in their contract or by agreeing to arbitrate after a dispute has arisen.

Have you encountered the situation whereby the delay of the construction work is solely due to the delay of the project owner ‘’Employer? You as the contractor, do you need to apply for Extension of time though the delay is not due to your fault.

Whenever there is delay in the construction works, contractor always can exercise their right under the contract to ask for extension of time. However, before to exercise such right, the contractor must then fulfil the condition precedents stated in the standard form contract.

In construction industry, non-payment or delay in payment is a “norm”. When facing such a situation, normally contractors tend to slow down their works or suspend their works until payments are paid by the employer. It is a fact that each contractor has a deadline to complete the works.It is undeniable that no contractor would like to advance their own fund to finance the construction project on behalf of the employer. Bear in mind that once the employer failed to make the payment, the employer in fact has breached the agreement/letter of award.

What if you didn’t get your payment when you have supplied goods to the contractors or you have done the construction works? In Malaysia, there are many contractors/suppliers facing collections issues whereby they have supplied goods to the contractors or done the construction works yet no payment made to them.