Construction Agreement Template for Malaysia

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Key Requirements PROMPT example:

Construction Agreement

"I need a Construction Agreement for a 20-story commercial building project in Kuala Lumpur, with specific provisions for green building certification and sustainable construction methods, including detailed environmental compliance requirements under Malaysian law."

Document background

This Construction Agreement template is designed for use in Malaysia when engaging contractors for construction projects of any scale. It incorporates mandatory requirements under Malaysian law, particularly the Construction Industry Payment and Adjudication Act 2012 (CIPAA), the Street, Drainage and Building Act, and relevant safety regulations. The agreement is structured to protect both parties' interests while ensuring smooth project execution, covering essential elements from project scope and payment terms to dispute resolution mechanisms. It's particularly suitable for commercial, residential, and infrastructure projects, and can be customized based on project size, complexity, and specific requirements. The document aligns with Malaysian construction industry standards and practices, including common terms from standard forms like PAM and CIDB.

Suggested Sections

1. Parties: Identification and details of the employer/owner and contractor, including registration numbers and addresses

2. Background: Context of the agreement, including project overview and basis for entering into the contract

3. Definitions: Definitions of key terms used throughout the agreement, including technical construction terms

4. Scope of Works: Detailed description of the construction works to be performed, including general obligations of the contractor

5. Contract Sum and Payment Terms: Amount payable, payment schedule, and payment procedures in compliance with CIPAA 2012

6. Time for Completion: Project timeline, completion date, and provisions for extensions of time

7. Contractor's Obligations: Detailed responsibilities including workmanship, materials, safety requirements, and compliance with laws

8. Employer's Obligations: Responsibilities of the employer including site access, permits, and information provision

9. Variations: Procedures for handling changes to the scope of work and their cost implications

10. Quality and Standards: Required quality standards, inspections, and testing procedures

11. Defects Liability: Duration of defects liability period and obligations to rectify defects

12. Insurance and Indemnities: Required insurance coverage and indemnification obligations

13. Termination: Grounds and procedures for contract termination by either party

14. Dispute Resolution: Procedures for resolving disputes, including adjudication under CIPAA

15. General Provisions: Standard contractual provisions including notices, governing law, and assignment

Optional Sections

1. Performance Bond: Requirements for performance security, used when project value exceeds certain thresholds

2. Advance Payment: Terms for advance payment and its recovery, used when advance payment is agreed

3. Nominated Subcontractors: Provisions regarding employer-nominated subcontractors, used when specific subcontractors are required

4. Liquidated Damages: Pre-agreed damages for delay, used when specific completion dates are critical

5. Retention Sum: Provisions for retention money, used when additional payment security is required

6. Force Majeure: Provisions for unforeseen circumstances, particularly relevant in long-term projects

7. Environmental Protection: Specific environmental obligations, used for projects with significant environmental impact

8. Anti-Corruption: Specific anti-corruption provisions, used in public or high-value projects

9. Technology and BIM: Provisions for Building Information Modeling and other technology requirements, used in complex projects

Suggested Schedules

1. Schedule 1 - Scope of Works: Detailed technical specifications and scope of works

2. Schedule 2 - Contract Drawings: Approved construction drawings and design documents

3. Schedule 3 - Bill of Quantities: Detailed breakdown of quantities and rates

4. Schedule 4 - Payment Schedule: Detailed payment terms, milestones, and procedures

5. Schedule 5 - Project Timeline: Detailed construction program and milestone dates

6. Schedule 6 - Site Details: Site information, access points, and existing conditions

7. Schedule 7 - Required Insurances: Details of all required insurance policies and coverage

8. Schedule 8 - Forms and Notices: Standard forms for variations, certificates, and notices

9. Schedule 9 - Quality Assurance Requirements: Detailed quality standards and testing procedures

10. Appendix A - Special Conditions: Any special conditions or requirements specific to the project

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

alex.den.21@genieai.co

Relevant legal definitions

Clauses

Relevant Industries

Real Estate

Infrastructure

Commercial Development

Industrial Development

Residential Development

Healthcare

Education

Hospitality

Retail

Manufacturing

Energy

Transportation

Public Sector

Mining

Telecommunications

Relevant Teams

Legal

Operations

Commercial

Procurement

Project Management

Technical

Finance

Risk & Compliance

Health & Safety

Business Development

Construction

Quality Assurance

Relevant Roles

Construction Manager

Project Director

Contract Manager

Legal Counsel

Quantity Surveyor

Project Manager

Site Engineer

Commercial Director

Procurement Manager

Risk Manager

Chief Executive Officer

Operations Director

Technical Director

Finance Director

Development Manager

Compliance Officer

Health and Safety Manager

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