Claiming Success: Understanding Condition Precedent in Malaysian Construction Industry

Tee, Yik Kei (2025) Claiming Success: Understanding Condition Precedent in Malaysian Construction Industry. Final Year Project (Bachelor), Tunku Abdul Rahman University of Management and Technology.

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Abstract

In Malaysia, the construction industry is essential for the development of its infrastructure, frequently involving complicated multi-party projects. These projects frequently face disputes and claims, particularly those that relate to loss and expense (L&E). The increasing failure rate of L&E claims is an important issue, frequently resulting from the contractor's failure to adhere to the conditions precedent specified in Standard Forms of Contracts (SFCs). The purpose of this study is to examine the impact of the condition precedent in SFCs used in Malaysia, including PAM 2018, P.W.D. 203A, FIDIC (Red Book) 2017, and AIAC 2024, on L&E claims. A case law analysis and interviews with claim consultants are employed in the research methodology to look into specific contractual conditions and notification requirements for valid claims. According to the results, contractors frequently encounter claim rejections as a result of failing to adhere to critical requirements, such as serving the notice within the time frame given and proper documentation. This research highlights the significance of complying with these requirements to safeguard the success of L&E claims. The research seeks to assist contractors and employers in the effective management of claims, the reduction of disputes, and the advancement of improved project outcomes through an understanding of these procedural requirements.