An Analysis on the Valuation of Variation Order of Building Works in the Malaysian Construction Industry

Teti, Christine Valirie Sabanal (2023) An Analysis on the Valuation of Variation Order of Building Works in the Malaysian Construction Industry. Final Year Project (Bachelor), Tunku Abdul Rahman University College.

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Abstract

Regardless of the terminology used, ‘Variation Order’ or ‘Change Order’ is a common occurrence in the construction industry globally. Due to the unpredictable and uncertain nature of the industry, any deviation from the original scope of works predetermined at the signing of the contract document shall constitute a variation. Since it is prevalent in the industry, most, if not all, standard form of contract provides provisions on the subject matter. However, it is worth noting that despite the availability of provisions, disputes pertaining to variation are still rampant. Therefore, it begs the question of whether or not the provisions are sufficient to bridge the loopholes from which disputes flourish. This research will evaluate and analyse the provisions of variation from four commonly used standard forms of contract in the Malaysian Construction Industry, as well as a thorough understanding of how disputes arise from variation and ways to manage the disputes will be established.