Pwd 203 a rev2007

GOVERNMENT OF MALAYSIA

STANDARD FORM OF CONTRACT TO BE USED

WHERE BILLS OF QUANTITIES FORM PART OF

THE CONTRACT

P.W.D. FORM 203A (Rev. 2007)

Hak Cipta Terpelihara Kerajaan Malaysia

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TABLE OF CONTENT

1.0 DEFINITIONS AND INTERPRETATION ...........................................................................1

2.0 CONTRACT PERIOD ...................................................................................................3

3.0 THE S.O. AND S.O:S REPRESENTATIVE .....................................................................4

4.0 S.O:S RIGHT TO TAKE ACTION ....................................................................................4

5.0 S.O:S INSTRUCTIONS ...............................................................................................5

6.0 SCOPE OF CONTRACT ................................................................................................5

7.0 CONTRACT SUM ......................................................................................................6

8.0 CONTRACT DOCUMENTS ..........................................................................................6

9.0 REPRESENTATIONS, WARRANTIES AND UNDERTAKINGS OF THE CONTRACTOR ...........7

10.0 OBLIGATIONS OF THE CONTRACTOR .......................................................................8

11.0 INSPECTION OF SiTE ................................................................................................9

12.0 PROGRAMME OF WORK ..........................................................................................9

13.0 PERFORMANCE BOND/PERFORMANCE GUARANTEE SUM .........................................9

14.0 INDEMNITY IN RESPECT OF PERSONAL INJURIES AND DAMAGE TO PROPERTY ..........10

15.0 INSURANCE AGAINST PERSONAL INJURIES AND DAMAGE TO PROPERTY ....................11

16.0 INDEMNITIES TO GOVERNMENT IN RESPECT OF CLAIMS BY WORKMEN .....................12

17.0 EMPLOYEES' SOCIAL SECURITY ACT, 1969 ...............................................................12

18.0 INSURANCE OF WORKS ..........................................................................................13

19.0 SETIING OUT .........................................................................................................14

20.0 UNFIXED MATERIALS AND GOODS ...........................................................................14

21.0 COMPLIANCE WITH THE LAW ...................................................................................14

22.0 DESiGN ..................................................................................................................15

23.0 EMPLOYMENT OF WORKMEN ..................................................................................16

24.0 VARIATIONS ...........................................................................................................17

25.0 VALUATION OF VARIATION ......................................................................................18

26.0 BILL OF QUANTITIES ...............................................................................................18

27.0 MEASUREMENT OF WORKS ...................................................................................19

28.0 PAYMENT TO CONTRACTOR AND INTERIM CERTIFICATES .........................................20

29.0 ADJUSTMENT OF CONTRACT SUM ...........................................................................20

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30.0 FLUCTUATION OF PRICE ...........................................................................................21

31.0 FINAL ACCOUNT AND PAYMENT CERTIFICATE ..........................................................21

32.0 EFFECT OF S.O.'S CERTIFICATES .............................................................................22

33.0 DEDUCTION FROM MONEY DUE TO CONTRACTOR ...................................................22

34.0 PRIME COST I PROVISIONAL SUMS ..........................................................................22

35.0 MATERIALS, GOODS AND WORKMANSHIP ................................................................22

36.0 INSPECTION AND TESTING OF MATERIALS, GOODS AND EQUIPMENT ........................23

37.0 CONSTRUCTIONAL PLANT, EQUIPMENT, VEHICLES AND MACHINERIES ......................24

38.0 POSSESSION OF SiTE ...............................................................................................24

39.0 COMPLETION OF WORKS ........................................................................................25

40.0 DAMAGES FOR NON-COMPLETION ...........................................................................26

41.0 SECTIONAL COMPLETION .......................................................................................26

42.0 PARTIAL OCCUPATIONITAKING OVER BY GOVERNMENT ...........................................27

43.0 DELAY AND EXTENSION OF TIME .............................................................................28

44.0 CLAIMS FOR LOSS AND EXPENSE ...........................................................................29

45.0 INVESTIGATION BY THE GOVERNMENT AND OTHER PERSONS IN CASE OF ACCIDENT,

FAILURE OR OTHER EVENT .................................................................................... 30

46.0 ACCESS FOR WORKS ETC .............................. ; ..........................................................30

47.0 SUB-CONTRACT OR ASSiGNMENT ...........................................................................30

48.0 DEFECTS AFTER COMPLETION ................................................................................31

49.0 UNFULFILLED OBLIGATIONS ......................................................................................32

50.0 SUSPENSION OF WORKS ........................................................................................32

51.0 EVENTS AND CONSEQUENCES OF DEFAULT BY THE CONTRACTOR ...........................33

52.0 TERMINATION ON NATIONAL INTEREST ....................................................................36

53.0 TERMINATION ON CORRUPTION ..............................................................................36

54.0 PAYMENTS UPON TERMINATION ..............................................................................37

55.0 CERTIFICATE OF TERMINATION COSTS .....................................................................37

56.0 SURVIVING RIGHTS ................................................................................................38

57.0 EFFECT OF FORCE MAJEURE .................................................................................38

58.0 SITE AGENT AND ASSISTANTS ................................................................................39

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59.0 NOMINATED SUB-CONTRACTORS AND/OR NOMINATED SUPPLIERS ...........................39

60.0 PAYMENT TO NOMINATED OR SUB-CONTRACTOR OR SUPPLIER ................................ .40

61.0 NO LIABILITY OF GOVERNMENT TO NOMINATED AND/OR SUB- CONTRACTOR OR

SUPPLIER ..............................................................................................................40

62.0 RESPONSIBILITIES OF CONTRACTOR TO NOMINATED AND/OR SUB-CONTRACTORS OR

SUPPLIERS ............................................................................................................41

63.0 INTELLECTUAL PROPERTY RIGHTS ..........................................................................41

64.0 ANTIQUiTIES ..........................................................................................................42

65.0 ARBITRATION .........................................................................................................42

66.0 NOTICE, ETC . .........................................................................................................43

67.0 AMENDMENT ..........................................................................................................44

68.0 CONFIDENTIALITy ...................................................................................................44

69.0. STAMP DUTY ..........................................................................................................44

70.0 SEVERABILITY ........................................................................................................44

71.0 WAIVER ..................................................................................................................45

72.0 LAWS APPLiCABLE ..................................................................................................45

73.0 SUCCESSORS BOUND .............................................................................................45

74.0 EPIDEMICS AND MEDICAL ATTENDANCE ...................................................................45

75.0 TECHNOLOGY TRANSFER ........ '................................................................................45

76.0 GENERAL DUTIES AND PERFORMANCE STANDARD ...................................................45

77.0 RESTRICTION AND PROCEDURE ON USE OF IMPORTED MATERIALS AND'GOODS ....... .46

78.0 TIME .......................................................................................................................46

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CONTRACT NO: _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ of 20 _ _

EXPENDITURE to be met from: Head ...................................•........•••.......

Sub·head ..................................................

Year of ....................................................

A CONTRACT made on day of ................... 20...... between the Government of Malaysia
(hereinafter referred to as the "Governmenr) of the one part and

(Company No.: ...................) (hereinafter called the "Contractor") and having its registered address at

..................................................................................................................... of the other part.

(The Government and the Contractor shall hereinafter individually be referred to "Party" or collectively as
the "Parties")

WHEREAS:

A. The Government is desirous of .......................................................................................

~ ........................... ~ ......................... ~
. .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0 , 0 . . . ,. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ..

at ........................................................................................ (hereinafter referred to as
the Works') and has caused Drawings, Bills of Quantities, Specification describing the work to be
done to be prepared.

B. The said Drawings numbered ...................................................... (hereinafter referred to as
the "Contract Drawings"), and the Bills of Quantities, Specification, Form of Tender and Letter of
Acceptance of Tender have been signed by or on behalf of the Parties hereto.

NOW IT IS HEREBY AGREED AS FOLLOWS:

1.0 DEFINITIONS AND INTERPRETATION

1.1 Definition
Unless the context otherwise requires, this Contract or an item or entry in the Appendices specifically
otherwise provides, the following words and phrases in this Contract and the Appendices shall have the
meaning given below or ascribed in the clauses or Appendix item to which reference is made:

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(a) "Contract" means this contract and the appendices attached hereto;

(b) "Contract Documents" means the documents forming the tender and acceptance
thereof including:
Form of Tender;
Letter of Acceptance of Tender;
Contract Drawings;
Bills of Quantities;
Specifications;
Treasury's Instructions;

and all these documents shall be complementary to one another;

(c) "Contractor" means the person or persons, sole proprietor, partnership, firm
or company whose tender for the Works has been accepted and
who has or have signed this Contract and includes the
Contractor's personal representatives, heirs, successors,
executors, administrators, servant and agent;

(d) "Contract Period" means the time frame stipulated in clause 2;

(e) "Contract Sum" means the sum stipulated in clause 7;

(f) "Date for Completion" means the date fixed and stated in Appendix or any other date
as provided for in clause 39;

(g) "Defects Liability Period" means the period stated in Appendix' or if none stated, the
period is twelve (12) months from the date of practical
completion certified by the S.O. as provided for under clause
39.3;

(h) "Nominated Sub means all specialist, merchants, tradesmen and others executing
Contractor" or "Nominated any work or services, or supplying any materials or goods for
Supplier" which Prime Cost Sum (or P.C. Sums) are included in the Bills of
Quantities or which the S.O. has given written instructions in
regard to the expenditure of Provisional Sum and who may be
nominated by the S.O. and employed by the Contractor as Sub
contractors or Suppliers;

(i) "On-Cost Charges" means any cost and expenses reasonably incurred by the
Government;

G) "Officer Named" means officer empowered to take action on behalf of the
Government pertaining to clauses .................. ;

(k) "Prime Cost" or means a sum for works or services to be executed by a
abbreviation "P.C. Sum" Nominated Sub-Contractor or sums for materials or goods to be
obtained from a Nominated Supplier;

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(I) "Provisional Sum" means a sum for work or for the supply of goods or materials
which cannot be defined or detailed at the time the tender
documents are issued;

(m) "Site" means the land and other places on, above, under, in or through
which the Works are to be executed and any other lands or
places provided or approved by the Government for working
space or any other purposes as may be specifically deSignated
in this Contract and whether the same may be on the Site or not;

(n) "5.0." means the Superintending Officer who shall be
....................................and/or his successors in office;

(0) "S.O.'s Representatives" means any person or persons delegated or authorised in writing
by the S.O. to perform any of the duties of the S.O. as may be
from time to time notified in writing to the Contractor by the S.O.
pursuant to clause 3.3(a) of this Contract;

(p) "Works" means the works specified in the Contract Documents and shall
include temporary works.

1.2 Interpretation

(a) The terms "approved or approval" and "directed or direction" wherever used in this Contract
shall be in writing.

(b) Words importing the singular include the plural and vice versa where the context requires.

(c) The headings are for convenience of reference only and shall not be deemed to be part of
this Contract or be taken into consideration in the interpretation or construction of this
Contract.

(d) Unless otherwise specifically stated, a reference in this Contract and the Appendices to any
clause means that clause in this Contract.

(e) This Contract and the Appendices are to be read as a whole and the effect or operation of
any clause in this Contract or item in or entry in the Appendices shall, unless otherwise
specifically stated, be read subject to any relevant qualification or modification in any other
clauses in this Contract or item in or entry in the Appendices.

2.0 CONTRACT PERIOD

The Contract Period shall be for a period of ............................................ commencing from

................................ ending on .................................

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3.0 THE S.O. AND S.O.'S REPRESENTATIVE

3.1 Duties of S.O. and S.O.'s Representative

The S.O. shall be responsible for the overall supervision and direction of the Works. All matters
regarding the Works shall be dealt with by the Contractor with the S.O.

3.2 S.O.'s Representative

(a) The S.O. may from time to time appoint such number of S.O.'s Representative as he
deems fit.

(b) The S.O.'s Representative shall be responsible to the S.O. and his duties are to watch
and supervise the Works and to test and examine any materials or goods to be used or
workmanship employed in connection with the Works.

3.3 S.O.'s Authority to Delegate

(a) The S.O. may from time to time in writing delegate to the S.O.'s Representative any of
the powers and authorities vested in the S.O. as listed in the letter of delegation and
shall furnish to the Contractor a copy of all such written delegation of powers and
authorities.

(b) Any instruction or approval given by the S.O.'s Representative to the Contractor within
the terms of such delegation shall bind the Contractor and the Government as though it
had been given by the S.O. PROVIDED THAT failure of the S.O.'s Representative to
disapprove any work or material shall not prejudice the power of the S.O. thereafter to
disapprove such work or materials and to order the pulling down. removal or breaking up
thereof.

(c) If the Contractor is not satisfied with any decision of the S.O.'s Representative. the
Contractor shall refer the matter to the S.O. who shall confirm, reverse or vary the
decision of the S.O.'s Representative.

(d) The delegation under this clause shall not preclude the S.O. from himself exercising or
performing at any time any of the delegated powers and duties.

4.0 S.O.'S RIGHT TO TAKE ACTION

4.1 Notwithstanding any provision in this Contract it is hereby agreed that:

(a) the right to act on behalf of the Government in respect of any matter which arises out of
the provisions of clauses 43, 50, 51, 52, 53, 57 or 65, where appropriate, is expressly
reserved to the authorized officer or officers named in Appendix;

(b) the power of the S.O. to issue instruction requiring a variation under clause 24 shall be
subject to the financial limits as set out in Appendix hereto. If the instruction for a
variation under clause 24 is more than the financial limits as set out in the Appendix, the
S.O. shall obtain the prior written approval of the relevant authorities of the Government.

4.2 The Contractor shall not be entitled to extension of time or any extra cost or expense or
whatsoever arising from compliance with this clause 4.

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5.0 5.0.'5 INSTRUCTIONS

5.1 The S.O. may from time to time issue further drawings, details and/or written instructions (all of
which are hereafter collectively referred to as "S.O:s instructions") in regard to

(a) the Variation as referred to in clause 24 hereof;

(b) any discrepancy in or between the Contract Documents as referred to in clause 8.2(b)
hereof;

(c) the removal from the Site of any materials or goods brought thereon by the Contractor
and the substitutions of any other materials or goods therefore;

(d) the removal and/or re-execution of any works executed by the Contractor;

(e) the dismissal from the Works of any person mentioned in clause 23.6 hereof employed
thereupon;

(f) the opening up for inspection of any work covered up;

(g) the amending and making good of any defects whatsoever under clause 48;

(h) any matter which is necessary and incidental to the carrying out and completion of the
Works under this Contract; and

(i) any matter in respect of which the S.O. is expressly empowered by this Contract to issue
instructions.

5.2 All instructions issued by the S.O. shall be in writing. The Contractor shall forthwith comply with
all instructions issued to him by the S.O. If such instruction is given orally, the S.O. shall then
issue a written instruction within seven (7) days from the date of such oral instruction is given.

5.3 If within seven (7) days after receipt of a written notice from the S.O. requiring compliance of an
instruction and the Contractor does not comply therewith, then the S.O. without prejudice to any
other rights or remedies available to the Government under this Contract, undertake the work
departmentally or employ and pay ~mother Contractor or any other persons to execute any work
whatsoever which may be necessary to give effect to such instruction. All costs and expenses
incurred in connection with such employment (including On-Cost Charges), shall be deducted
from any money due or to become due to the Contractor under this Contract, and failing which
such deductions shall be recovered from the Performance Bond or as a debt due from the
Contractor.

5.4 The Contractor shall be responsible for all costs and expenses incurred by the Government in
carrying out the Works under clause 5.3 and On-Cost Charges (calculated by applying the
Percentage of On-Cost Charges stated in Appendix hereto to the amount incurred). The
Government shall be entitled to deduct such costs, expenses and On-cost Charges or any part
thereof from any monies due or to become due to the Contractor under this Contract or to
recover the same from the Performance Bond or as a debt due from the Contractor.

6.0 SCOPE OF CONTRACT

6.1 The Contractor shall upon and subject to this Contract, construct and complete the Works using
materials, goods and workmanship of the quality and standards therein specified.

6.2 The Contractor must also undertake any consequential work in relation to the construction and
completion of Works on the Site Le. removal/diversion of public sewer, water mains, electrical
mains, gas mains and telephone mains and the installation of permanent connections thereto

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shall be borne by the Government. The Government shall reimburse the Contractor for such
costs by adding it to the Contract Sum PROVIDED THAT such cost have not already been
included in the Contract Sum by way of a Provisional Sum or otherwise.

PROVIDED FURTHER any temporary connection shall be obtained by the Contractor with no
additional cost to the Government for purpose of carrying out their work.

6.3 The Contractor shall also make good any defect, imperfection, shrinkage or any other fault
whatsoever which may appear during the Defects Liability Period in accordance with clause 48
hereof.

7.0 CONTRACT SLIM

The Government hereby covenants to pay the Contractor in consideration of the construction and
completion of the Works and making good of any defects whatsoever to the Works the sum of Ringgit:

(RM .......................................) or such other sum as shall become payable under and at the times
and in the manner speCified in this Contract.

8.0 CONTRACT DOCUMENTS

8.1 Custody of the Contract Documents

(a) The Contract shall be prepared in two (2) original copies. The original copies of the
Contract shall remain in the custody of the S.O. and the Contractor.

(b) Immediately after the execution of this Contract, the S.O. shall furnish to the Contractor
without any charge (unless he shall have been previously furnished) with:

(i) two (2) copies of the Contract Drawings; and

(ii) two (2) copies of the unpriced Bills of Quantities and (if requested by the
Contr~ctor) one copy of the priced Bills of Quantities.

(c) The S.O. shall, as and when necessary and without charge to the Contractor, furnish
him with two (2) copies of such further working drawings or details as are reasonably
necessary either to explain and amplify the Contract Drawings or the Specification (if
any) or to enable the Contractor to construct and complete the Works in accordance with
this Contract. PROVIDED THAT nothing contained in the said working drawings or
details shall impose any obligation beyond those imposed by the Contract Documents.

(d) The Contractor shall keep one copy of the Contract Drawings, the Specification (if any),
unpriced Bills of Quantities, priced Bills of Quantities (if any) and other like documents
referred to in sub-clause (c) hereof on the Site and the S.O. shall at all reasonable times
have access to the same.

(e) Upon final payment being made pursuant to the issuance of Final Account and Payment
Certificate under clause 31, the Contractor shall return to the S.O. all drawings, details,
specifications, unpriced copy of Bill of Quantities and priced Bill of Quantities, if any.

(f) None of the documents hereinbefore mentioned shall be used by the Contractor for any
purpose other than this Contract.

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8.2 Sufficiency of Contract Documents

(a) The Contract documents are to be taken as mutually explanatory of one another. The
Contractor shall provide everything necessary for the proper execution of the Works until
its completion according to the true intent and meaning of the Contract Documents taken
together whether the true intent and meaning mayor may not be particularly shown or
described PROVIDED THAT it can be reasonably inferred therefrom.

(b) If the Contractor shall find any discrepancy in or divergence between any two or more of
the Contract Documents including a discrepancy or divergence between parts of any
one of them, he shall immediately give to the S.O. a written notice specifying the
discrepancy or divergence and the S.O. shall issue instructions in regard thereto
PROVIDED ALWAYS that such discrepancy or divergence shall not vitiate this Contract.

9.0 REPRESENTATIONS, WARRANTIES AND UNDERTAKINGS OF THE CONTRACTOR

9.1 Representations and Warranties

The Contractor hereby represents and warrants to the Government that

(a) it is a corporation validly existing under the laws of Malaysia.;

(b) the Contractor has obtained a valid registration with the Construction Industry
Development Board;
(c) it has the corporate power to enter into and perform its obligations under this Contract
and to carry out the transactions and to carry on its business as contemplated by this
Contract*;

(d) it has taken all necessary corporate actions to authorize the entry into and performance
of this Contract and to carry out the transactions contemplated by this Contract*;

(e) as at the execution date, neither the execution nor performance by it of this Contract nor
any transactions contemplated by this Contract will violate in any respect any provision
of

(i) its Memorandum and Articles of Association; or

(ii) any other document or agreement which is binding upon it or its asset*;

(f) no litigation, arbitration, tax claim, dispute or administrative proceeding is presently
current or pending or, to its knowledge, threatened, which is likely to have a material
adverse effect upon it or its ability to perform its financial or other obligations under this
Contract;

(g) this Contract constitutes a legal, valid and binding obligation of the Contractor and is
enforceable in accordance with its terms and conditions;

(h) it has necessary financial and technical capability to undertake the Works,

and the Contractor acknowledges that the Government has entered into this Contract in reliance
on its representations and warranties as aforesaid .

• applicable only if the Contractor is a company registered under the Companies Act 1965.

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9.2 Undertakings of the Contractor'"

The Contractor undertakes that

(a) it shall comply with all requirements, statutory or otherwise, regulating or relating to the conduct,
trade, business or profession of a contractor, and the Contractor shall be fully and solely liable for
all costs incurred thereby;

(b) it shall pay all taxes that may be imposed on the profits made in respect of this Contract in
accordance with the applicable laws; and

(c) it shall ensure that all his employees, including non-Malaysian personnel, comply with all relevant
laws to which they are subject to including payment of income tax, which in respect thereto the
Contractor shall make such deductions from the salaries of his employees as may be lawfully
imposed by the relevant authority.

10.1 OBLIGATIONS OF THE CONTRACTOR

The Contractor shall

(a) construct, complete, test and commission the Works in accordance with the Contract;

(b) perform the Works in a proper manner and in accordance with good management practice and to
the best advantage of the Government;

(c) take all appropriate measures expected of a contractor providing similar works to ensure that the
Works comply with the requirements of this Contract;

(d) perform the Works and discharge its obligations as contained in this Contract by exercising
professiona~ judgment and practice, requisite skill, care and diligence. In performing the Works,
the Contractor shall provide well-outlined procedures in the form agreed by the Government for
reporting and co-ordination purposes;

(e) at all times perform the Works in such manner as will always safeguard and protect the
Government's interest in relation to. the Works and take all necessary and proper steps to
prevent abuse or uneconomical use of facilities, if any, made available by the Government to the
Contractor;

(f) inform the Government immediately in writing of the occurrence of any factor or event, which is
likely to affect the Works. Such notification shall not be construed as a discharge of any of the
Contractor's obligations under this Contract;

(g) provide and maintain throughout the Contract Period such number, categories of qualified and
competent personnel necessary to perform the Works;

(h) provide and maintain at its own cost and expense all equipment and materials necessary for the
proper and effective performance of the Works;

(i) instruct and supervise its staffs and sub-contractor in carrying out the Works' repairs and other
works in relation to the Works;

m make good any defect, imperfection, shrinkage or any other fault whatsoever which may appear
during the Defects Liability Period; and

(k) carry out any other obligations and responsibilities under this Contract.

• applicable only if the Contractor is a company registered under the Companies Act 1965.

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11.0 INSPECTION OF SITE

11.1 The Contractor shall be deemed to have inspected and examined the Site and its surroundings
and to have satisfied himself before submitting his tender as to the following:

(a) the nature of the ground and subsoil;

(b) the form and nature of the Site;

(c) the extent and nature of the work, materials and goods necessary for the completion of the
Works;

(d) the means of communication with and access to the Site;

(e) the accommodation he may require; and

(f) in general to have obtained for himself all necessary information as to risks, contingencies and all
circumstances influencing and affecting his tender.

11.2 Any information or document forwarded by the Government to the Contractor shall not relieve the
Contractor of his obligations under the provisions of this clause.

12.0 PROGRAMME OF WORK

12.1 Where a programme of work is not provided by the S.O., the Contractor shall within fourteen (14)
days after the date of the Letter of Acceptance, submit to the S.O. for his approval a programme
of work for the execution of the Works in such forms and details as the S.O. shall reasonably
determined.

12.2 If at any time it should appear to the S.O. that the actual progress of the Works does not conform
to the fixed or approved programme of work referred to in clause 12.1 nereof, the Contractor
shall produce, a revised programme of work showing the necessary modifications to the
approved programme necessCry to ensure completion of the Works within the time for
completion as defined in clause 39 hereof or any extended time granted pursuant to clause 43.

13.0 PERFORMANCE BOND/PERFORMANCE GUARANTEE SUM

13.1(a) The Contractor shall, on the date of the possession of Site, provide a Performance Bond or
Performance Guarantee Sum as the case may be substantially in the form as in Appendix issued
by an approved licensed bank or financial institution incorporated in Malaysia in favour of the
Government for a sum equivalent to five percent (5%) of the total Contract Sum as specified in
Appendix to secure the due performance of the obligations under this Contract by the Contractor.
The Performance Bond shall remain valid and effective until twelve (12) months after the expiry
of the Defect Liability Period or the issuance of the Certificate of Completion of Making Good
Defects, whichever is the later.

(b) If the Contractor fails to submit the said Performance Bond as speCified in sub-clause (a) above
on the date of possession of site, then the Contractor shall be deemed to have opted for
Performance Bond in the form of Performance Guarantee Sum as provided for under clause 13.2
hereof.

13.2 The Contractor may opt for a Performance Bond in the form of Performance Guarantee Sum in
lieu of the Bank, Insurance or Finance Company Guarantee as speCified in clause 13.1 hereof
whereby deductions of ten percent (10%) shall be made from the first interim payments and
subsequent interim payment until the total amount deducted aggregate to a sum equivalent to

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five (5) percent of the Contract Sum. The amount deducted shall be retained by the Government
up to twelve (12) months after the expiry of the Defect Liability Period or the issuance of the
Certificate of Completion of Making Good Defects. whichever is the later.

13.3 Notwithstanding anything contained in this Contract, the Government shall be entitled at any time
to call upon the Performance Bond. wholly or partially. in the event that the Contractor fails to
perform or fulfil its obligations under this Contract and such failure is not remedied in accordance
with this Contract.

13.4 If a payment is made to the Government pursuant to any claim under the Performance Bond, the
Contractor shall issue to the Government further security in the form of additional performance
bond or bonds for an amount not less than the amount so paid to the Government on or prior to
the date of such payment so that the total sum of the Performance Bond shall be maintained at
all times at the value specified in clause 13.1(a).

13.5 The Performance Bond (or any balance thereof remaining for the credit of the Contractor) may
be released or refunded to the Contractor on the completion of making good of all defects.
shrinkages or other faults which may appear during the Defects Liability Period and upon the
giving of the Certificate of Completion of Making Good Defects for the whole of the Works under
clause 48.

13.6 Notwithstanding the above. in the event that this Contract is terminated under clause 51 hereof
the said Performance Bond or any balance thereof shall be forfeited.

14.0 INDEMNITY IN RESPECT OF PERSONAL INJURIES AND DAMAGE TO PROPERTY

14.1 The Contractor agrees with the Government that

(a) it shall perform all of its obligations under this Contract at its own risk and releases. to the fullest
extent permitted by law. the Government and their agents and servants from all claims and
demands of every kind resulting from any accident. damage, injury or death arising from the
carrying out of the Works except where such accident. damage, injury or death is caused or
contributed to by any act or omission or negligence of the Government or its agents and
servants. The Contractor expressly agrees that in the absence of any such act, omission or
negligence as aforesaid the Government shall· have no responsibility or liability whatsoever in
relation to such accident. damage, injury or death;

(b) it shall indemnify and keep indemnified the Government from and against all actions, suits, claims
or demands, proceedings, losses, damages, compensation, costs (including legal cost), charges
and expenses whatsoever to which the Government shall or may be or become liable in respect
of or arising from

(i) the negligent use, misuse or abuse by the Contractor or its personnel, servants, agents or
employees appointed by the Contractor;

(ii) any loss or damage to property or injury of whatsoever nature or kind and howsoever or
wherever sustained or caused or contributed to by carrying out of the Works by the
Contractor to any person and not caused by the negligence or wilful act. default or
omission of the Government, its agents or servants; or

(iii) any loss, damage or injury from any cause whatsoever to property or persons affected by
the Works to the extent to which the same is occasioned or contributed to by the act,
omission, neglect, breach or default of the Contractor or personnel, servants, agents or
employees; and

(c) the obligations under this clause shall continue after the expiry or earlier termination of this
Contract in respect of any act, deed, matter or thing happening before such expiration or
termination of this Contract.

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14.2 The Contractor shall indemnify, protect and defend at its own cost and expense, the Government
and its agents and servants from and against all actions, claims and liabilities arising out of acts
done by the Contractor in the performance of this Contract.

15.0 INSURANCE AGAINST PERSONAL INJURIES AND DAMAGE TO PROPERTY

15.1 Taking of Insurance

(a) Without prejudice to his liability to indemnify the Government under clause 14 hereof, the
Contractor shall, as a condition precedent to the commencement of any work under this
Contract, effect and maintain such insurances whether with or without an excess amount as
specified in Appendix hereto as are necessary to cover the liability of the Contractor and all sub
contractors, whether nominated or otherwise.

(b) Such insurance shall be for the purpose of personal injuries or death, damage or loss to property,
movable or immovable, arising out of, or in the course of, or by reason of the execution of the
Works and caused by any negligence, omission. breach of contract or default of the Contractor
or any sub-contractor. whether nominated or otherwise, or of any servants or agents of the
Contractor or of any such SUb-contractor, whether nominated or otherwise. Where an excess
amount is specified in Appendix. the Contractor shall bear the amount of such excess. The policy
or poliCies of insurance shall contain a cross liability clause indemnifying each of the jointly
insured against claims made by on him by the other jOintly insured.

(c) Such insurance as referred to under sub-clause (a) hereof shall be effected with an insurance
company as approved by the Government and maintained in the joint names of the Government
and Contractor and all sub-contractors, whether nominated or otherwise. Such insurance shall
cover from the period of the date of possession of site until the date of issuance of Certificate of
Making Good Defects for any claim occasioned by the Contractor or any sub-contractor in the
course of any operations carried out by the Contractor or any sub-contractor for the purpose of
complying with his obligations under Clause 48 hereof.

15.2 Production of Policies

It shall be the duty of the Contractor to produce and shall deposit the relevant policy or poliCies of the
insurance together with receipts in respect of premiums paid to the 5.0., whether demanded or not.

15.3 Default in Insuring .

If the Contractor fails to effect or renew such insurances as are required to be effected and maintained
under this Contract, the Government or the 5.0. on its behalf may effect or renew such insurance and
shall be entitled to deduct a sum equivalent to the amount in respect of the premiums paid and On-Cost
Charges (calculated by applying the 'Percentage for On-cost Charges' stated in Appendix hereto to the
premiums paid). from any money due or to become due to the Contractor under this Contract or to
recover the same from the Performance Bond or as a debt due from the Contractor.

15.4 Cancellation of Insurance

(a) The Contractor shall ensure that any insurance policy effected hereto shall only be cancelled by
the insurer after the expiry of thirty (30) days from the date of receipt by the Government of a
written notice from the insurer advising of such impending cancellation PROVIDED THAT the
Contractor has been issued with the Certificate of Making Good Defects in accordance with
clause 48.

(b) The Contractor shall not at any time permit or cause to be done any act, matter or thing which
may result in any insurance effected by virtue of this Contract being vitiated or rendered void or
voidable or whereby the rate of the premium on any insurance effected shall be liable to be
increased.

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15.5 Loss or Damage Occasioned by Insured Risk

(c) In the event of any damage or loss occurring during the performance of this Contract, the
Contractor shall repair, replace or make good such damage or loss from the amount of insurance
claimed, if sufficient, or if insufficient, using his own resources.

16.0 INDEMNITIES TO GOVERNMENT IN RESPECT OF CLAIMS BY WORKMEN

16.1 Workmen Compensation

(a) The Contractor shall be liable for and shall indemnify and keep indemnified the
Government and its officers or servants from all liabilities arising out of claims by any
workman employed by the Contractor in and for the performance of this Contract for
payment of compensation under or by virtue of the Workmen's Compensation Act 1952
and the Employee's Social Security Act 1969 or any other law amending or replacing
such law and from all costs and expenses incidental and consequential thereto.

(b) The Contractor shall effect and maintain throughout the Contract Period a 'Workmen
Compensation Insurance" or any other applicable insurance for its personnel, servants,
agents or employees required under the laws of Malaysia.

17.0 EMPLOYEES' SOCIAL SECURITY ACT, 1969

17.1 Registration with SOCSO

Without prejudice to his liability to indemnify the Government under clause 16. the Contractor
shall register or cause to register all local workmen employed in the execution of the Works and
who are subject to registration under the Employee's Social Security Scheme ("the SOCSO
Scheme") in accordance with the Employee's Social Security Act 1969 or any subsequent
modification or re-enactment of the said Act. For the purpose of this sub-clause, the term "local
workmen" shall include workmen who are Malaysian citizens and those who have permanent
resident status.

17.2 Contribution to SOCSO

The Contractor shall submit the Code Number and Social Security Numbers of all the workmen
registered under the SOCSO scheme to the S.O. for verification. The Contractor shall make
payment of all contribution from time to time on the first contribution day on which the same
ought to be paid and until the completion of this Contract and it shall be the dUty of the
Contractor to produce to the S.O. contribution statement or payment vouchers as evidence of
payment of such contribution, whether demanded or not.

17.3 Default in Complying with SOCSO

If the Contractor fails to comply with the terms of this Clause, the Government or the S.O. on its
behalf may without prejudice to any other remedy available to the Government for breach of any
terms of this Contract:

(a) withhold an amount from any money which would otherwise be due to the Contractor
under this Contract and which in the opinion of the S.O. will satisfy any claims for
compensation by workmen that would have been borne by SOCSO Scheme had the
Contractor not made default in maintaining the contribution; and/or

(b) pay such contributions as have become due and remain unpaid and deduct the amount
of such contributions including On-Cost Charges (calculated by applying the Percentage
of On-Cost Charges stated in Appendix to the contributions paid), from any money due

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or to become due to the Contractor under this Contract, and failing which such
contributions shall be recovered from the Performance Bond or as a debt due from the
Contractor.

18.0 INSURANCE OF WORKS

18.1 Taking of Insurance

(a) The Contractor shall in the joint names of the Government and the Contractor insure
against loss and damage by fire, lightning, explosion, storm, tempest, flood, ground
subsidence, bursting or overflowing of water tanks, apparatus or pipes, aircraft and other
aerial devices or articles dropped therefrom, riot and civil commotion, all work executed
and all unfixed materials and goods, delivered to. placed on or adjacent to the Works
and intended therefore (but excluding temporary buildings, plant, tools and equipment
owned or hired by the Contractor or any sub·contractor, nominated or otherwise) to the
full value thereof (plus any amount which may be specifically stated in Appendix or
elsewhere in the Contract Documents) and shall keep such work, materials and goods
so insured until the completion of the whole of the Works, notwithstanding any
arrangement for Sectional Completion or Partial Occupation by the Government under
this Contract. Such insurance policy or policies shall provide expressly for payment in
the first place to the Government of any insurance monies due under the policy or
poliCies. .

(b) The said insurance with or without an excess clause as specified in Appendix hereto
shall be effected with an insurance company approved by the S.O. and it shall be the
duty of the Contractor to produce to the S.O. the said policy or pOlicies and the receipts
in respect of the premium paid. Where an excess clause is specified in Appendix, the
Contractor shall bear the amount of such excess.

18.2 Default in Insuring

If the Contractor fails to effect or renew such insurance as are necessary under this clause, the
Government or the S.O. on its behalf may renew such insurance and pay the premium in respect
thereof and deduct the amount so expended including On·Cost Charges (calculated by applying
the 'Percentage of On-cost Charges' stated in Appendix to the premiums paid). from any money
due or to become due to the Contractor under this Contract, and failing which such premium
shall be recovered from the Performance Bond or as a debt due from the Contractor. .

18.3 Payment of Insurance in the Event of any Loss/Damage

Upon the occurrence of any loss or damage to the Works or unfixed materials or goods prior to
the date the Works has been certified as practically completed by the S.O. in the Certificate of
Practical Completion, the Contractor shall notwithstanding that settlement of any insurance claim
has not been completed, with due diligence restore, replace or repair the same, remove and
dispose of any debris and proceed with the carrying out and completion of the Works. All money
if and when received from the insurance under this clause shall be paid in the first place to the
Government and then (less any such amounts as are specifically required in Appendix or
elsewhere in the Contract Documents) be released to the Contractor by instalments on the
certificate for payment issued by the S.O., calculated as from the date of receipt of the money in
proportion to the extent of the work of restoration. replacement or repair and the removal and
disposal of debris previously carried out by the Contractor. The Contractor shall not be entitled to
any payment in respect of the work of restoration, replacement or repair and the removal and
disposal of debris other than the money received under the said insurance.

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18.4 Cancellation of Insurance Policy

The Contractor shall ensure that any insurance policy effected hereto shall only be cancelled by
the insurer after the expiry of thirty (30) days from the date of receipt by the Government of a
written notice from the insurer advising of such impending cancellation PROVIDED THAT the
Contractor has been issued with the Certificate of Making Good Defects in accordance with
clause 48.

19.0 SETriNG OUT

19.1 The Contractor shall be responsible for the true and proper setting out of the Works and for the
correctness of the positions, levels, dimensions and alignments of all parts of the Works and for
the provisions of all necessary instruments, appliances and labour in connection therewith.

19.2 If at any time during the progress of the Works any error in the positions, levels, dimensions or
alignments of any part of the Works is discovered, the Contractor shall at his own expense rectify
such error unless such error is based on incorrect data supplied in writing by the S.O.'s
Representative in which case the expense of rectifying shall be borne by the Government.

19.3 If at any time during the progress of the Works, any error shall appear or arise in the setting-out
required to construct the Works or in the position, levels, dimensions or alignment of any part of
the Works, the Contractor, on being required to do so by the S.O., shall at his own expense
rectify such error to the satisfaction of the S.O. The checking of any setting out of or of any line or
level by the S.O. shall not in any way relieve the Contractor of his responsibility for the
correctness thereof and the Contractor shall carefully protect and preserve all things used in the
setting-out required for the construction of the Works until the S.O. agrees that the said things
may be abandoned.

19.4 The Contractor shall give to the S.O. without charge such information as may be required by the
S.O. to enable him to check the setting-out required for the construction of the Works including
interpreting any marks made by the Contractor for the purpose of setting out.

20.0 UNFIXED MATERIALS AND GOODS

Unfixed materials and goods delivered to, placed on or adjacent to the Site and intended for
incorporation therein, shall"not be removed except for use upon the Works, unless the S.O. has
consented in writing to such removal. Where the S.O. has included the value of such materials or
goods in any certificate in accordance with clause 28, under which the Contractor has received
payment, such materials and goods shall become the property of the Government, but the
Contractor shall remain responsible for loss or damage to the same.

21.0 COMPLIANCE WITH THE LAW

21.1 The Contractor shall comply in all respects (including the giving of all notices and the paying of
all fees required) with any law, regulation or by-law, or any order or directive issued by any public
authority or public service company (hereinafter referred to as "Statutory Requirements"), relating
to the Works or, in the case of public authority or public service company, with those systems the
same are or will be connected. The Contractor shall submit to the S.O. all approvals received by
the Contractor in connection therein. The Contractor shall keep the Government indemnified
against all penalties and liability of every kind for breach of any such Statutory Requirements.

21.2 If after the Date of Tender (as speCified in Appendix) there is any change or amendment in any
written law, regulations and by-laws which necessitates any variation to the Works, the

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Contractor shall, before making such variation, give to the S.O. a written notice specifying and
giving the reason for such variation and apply for the S.O.'s instruction in respect of the matter.

22.0 DESIGN

22.1 Design Liability

(a) Notwithstanding any design and specifications supplied by the Government, if the
Contractor is required under this Contract to undertake the design of any part of the
Works which is a stand alone design as determined by the Government, the Contractor
shall ensure that such design shall be suitable, functional, safe and compatible with the
design and specifications of the Works and that it shall be undertaken and approved and
endorsed by a competent and registered professional.

(b) The Contractor shall submit to the S.O. all drawings, specifications, calculations and any
other relevant information for approval. No work shall commence without prior written
consent of the S.O.

(c) The Contractor shall be fully responsible for the design, execution and maintenance of
the Works or part thereof for which his design has been accepted by the Government,
and shall absolutely guarantee the Government independent of fault, that the design,
materials and workmanship for the Works or part of the works is suitable, functional, safe
and compatible with the requirements of the Government.

(d) The approval by the S.O pursuant to sub-clause (b) shall not relieve the Contractor of
any of his responsibilities under sub-clause (c).

22.2 Design Guarantee Bond

(a) The Contractor shall provide a Design Guarantee Bond for the said part of the Works
issued by an approved licensed bank or financial institution of the sum of Ringgit

(RM .................................) amounting to 5% of the value of the said part of the Works
substantially in the form as in Appendix [ ...... ] upon or before the issuance of the
Certificate of Practical Completion of the Works. Such Design Guarantee Bond shall
remain valid for a period of 5 years from the date of practical completion of the Works.

(b) If any defect or damage shall occur to that particular part of the works as a result of any
defect, fault, insufficiency or inadequacy in the deSign including workmanship, materials
or eqUipment which has become defective arising directly from design fault then the
approved licensed bank or financial institution issuing the Design Guarantee Bond
pursuant to sub-clause (a) above will indemnify and pay the Government, on demand by
the Government in writing notwithstanding any objection by the Contractor or any third
party, the sum of .............................................................................................
being equal to 5% of the value of the said part of the Works.

(c) If the Design Guarantee Bond is not deposited with the Government in accordance with
sub-clause (a) above, the Government shall have the right to claim from the
Performance Bond the sum of Ringgit ...................................................................
(RM ..................................) being 5% of the value of the said part of the Works.

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23.0 EMPLOYMENT OF WORKMEN

23.1 Workmen

(a) The Contractor shall employ, in the execution of this Contract, only Malaysian citizens as
workmen.

(b) If in any particular trade or skill required to complete the Works, the Contractor can show
to the satisfaction of the S.O. that Malaysian citizens are not available, then the
Contractor may employ non-Malaysian citizens subject to the approval of the
Government.

(c) The Contractor shall on the commencement of the Works furnish to the Jabatan Tenaga
Kerja of the State in which this Contract is performed all particulars connected with this
Contract and such returns as may be called for from time to time in respect of labour
employed by him on for the execution of this Contract, in accordance with the
requirements of the Employment Act 1955, Employment (Restriction) Act 1968, and
Internal Security (Registration of Labour) Regulation 1960 or any subsequent
modification or re-enactment thereof.

(d) The Contractor shall maintain on the Site at all times during the progress of the Works an
up to date register containing particulars of all workers employed by him.

(e) The Contractor shall cause his sub-contractors (including 'labour only' sub-contractors)
and Nominated Sub-Contractors to comply with the provisions of this clause.

23.2 Compliance with Employment Act 1955, etc.

In the employment of workmen for the execution of this Contract, the Contractor shall comply,
and shall cause his sub-contractors (including "labour only" sub-contractors) and Nominated
Sub-Contractors to comply with all the requirements of the Employment Act 1955, Employment
(Restriction) Act 1968, Employee's Provident Fund Act 1951, the Industrial Relations Act 1967
and any other law relating to the employment of workmen, or any subsequent modification or re
enactment thereof. PROVIDED THAT the Contractor shall not be entitled to a~y claim for
additional costs and payments whatsoever in respect of his compliance with this clause.

23.3 Days and Hours of Working

No work shall be done on:

(a) the weekly day of rest;

(b) any public holiday which is recognised in the state where this Contract is being carried
out; or

(c) between the hours of six in the evening and six in the following morning;

without the written permission of the S.O. PROVIDED THAT when such written application of the
Contractor is approved by the S.O., the Contractor shall comply fully with all the requirements of
the Employment Ordinance 1955 in regard thereto or any subsequent modification or re
enactment thereof and shall bear any costs for compliance therewith, and any extra costs
incurred by the Government in connection with the supervision of the Works.

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23.4 Wages Books and Time Sheets

(a) The Contractor shall keep and shall cause his sub-contractors (including "labour only"
sUb-contractors) and Nominated Sub-Contractors to keep proper wages books and time
sheets showing wages paid to and the time worked by all workmen employed by him
and his sub-contractors as aforesaid in and for the performance of this Contract.

(b) The Contractor shall produce such wages books and time sheets on demand for
inspection by any persons duly authorised by the S.O.

(c) The Contractor shall furnish to the S.O. or S.O.'s Representative such information
relating to the wages and conditions of employment of such workmen as the S.O. may
from time to time require.

23.5 Default in Payment of Wages

In the event of default in the payment of

(a) any money in respect of wages; and/or

(b) payment in respect of Employees Provident Fund Contributions,

of any workmen employed by the Contractor or his sub-contractors (including "labour only" sub
contractors) and Nominated Sub-contractors in and for the performance of this Contract, which a
claim has been filed with the Department of Labour, then the S.O. shall make payment to the
Director General of Labour and/or Employees Provident Fund, as the case may be, out of any
monies at any time due to the Contractor under this Contract and such payment shall be deemed
to be a payment made to the Contractor by the Government under and by virtue of this Contract.

23.6 Discharge of Workmen

(a) The Contractor shall employ in and about the execution of the Works only such persons as are of
good character, careful~ skilled and experienced in their respective vocations and trades.
. .
(b) The S.O. shall be at liberty to object to and require the Contractor to remove immediately from
the Site any person employed by the Contractor in or about the execution of the Works who in
the opinion of the S.O. misconducts himself or is incompetent or negligent in the proper
performance of his duties. Such person shall not again be employed upon the Works without the
prior written permission of the S.O.

(c) Any person so removed from the Works shall be replaced without delay by a substitute approved
by the S.O. PROVIDED THAT the Contractor shall not be entitled to any claim for any expense
whatsoever incurred by him in respect of any direction given by the S.O. under this clause.

24.0 VARIATIONS

24.1 The S.O. may issue instructions requiring a Variation in a form of a Variation Order. No variation
required by the S.O. shall vitiate this Contract. Upon the issuance of such Variation Order, the
Contractor shall forthwith comply with the Variation Order issued by the S.O.

24.2 The term 'Variation' means a change in the Contract Document which necessitates the alteration
or modification of the design, quality or quantity of the Works as described by or referred to
therein and affects the Contract Sum, including:

17

(a) the addition, omission or substitution of any work;

(b) the alteration of the kind or standard of any of the materials, goods to be used in the
Works; or

(c) the removal from the Site of any work executed or materials or goods brought thereon by
the Contractor for the purposes of the Works other than work, materials or goods which
are not in accordance with this Contract.

24.3 Any variation made under this clause shall not relieve the Contractor from his obligations under
clause 22.1(c).

25.0 VALUATION OF VARIATION

25.1 All variations instructed in writing by the S.O. in accordance with clause 24 hereof shall be
measured and valued by the S.O. The valuation of Variations, unless previously or otherwise
agreed, shall be made in accordance with the following rules:

(a) the rates in the Bills of Quantities after adjustment if necessary as provided in clauses
26.6 and 26.7 hereof, shall determine the valuation of work of similar character and
executed under similar conditions as work priced therein;

(b) the said rates, where work is not of similar character or executed under similar
conditions as aforesaid, shall be the basis of rates for the same, so far as may be
reasonable, failing which a fair valuation thereof shall be made by the S.O.;

(c) the rates in the Bills of Quantities shall determine the valuation of items omitted,
PROVIDED THAT if the omission substantially vary the conditions under which any
remaining items of work are carried out, the rates of such remaining items shall be
valued under rule (b);

25.2 Where work cannot properly be measured or valued, the S.O. may allow daywork price as
specified in Appendix. Unless otherwise provided in the Bills of Quantities, the daywork prices for
the purpose of this Contract shall be taken to mean the actual net cost to the Contractor of his
materials, plant and labour for the work Concerned. The Contractor shall be paid daywork prices,
plus fifteen percent (15%), which shall include for the cost of all ordinary plant, tools, scaffolding,
supervision and profit. PROVIDED ALWAYS that as a condition precedent to any right to any
payment the Contractor shall produce vouchers, receipts and wage books specifying the time for
labour and plant employed and materials used to the S.O. not exceeding seven (7) days after the
work shall have been done.

25.3 The amount of variations shall be certified by the S.O. and added to or deducted from the
Contract Sum as the case may be and the amount shall be adjusted accordingly.

26.0 BILL OF QUANTITIES

Basis of Contract Sum

26.1 The quality and quantity of the Works as set out in the Bills of Quantities shall be the basis of the
Contract Sum. Any error in description or quantity or omission of Works from the Bills of
Quantities shall not vitiate this Contract but shall be rectified and the amount in respect of such
rectification shall be added to or deducted from the Contract Sum as the case may be.

26.2 The Government reserves the right to adjust the prices and rates in the Bills of Quantities
submitted by the Contractor to ensure their reasonableness before acceptance of tender and the
decision of the Government shall be final.

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26.3 Any adjustment of the prices and/or rates in the Bills of Quantities required under clause 26. 2
and any arithmetical error or omission in the prices or rates and/or calculations of the Contractor
in the Bills of Quantities shall before the signing of this Contract be so rectified and adjusted that
when correctly calculated, the total amount in the Summary of the Bills of Quantities shall
represent the same amount as the tender amount in the Form of Tender. The tender amount
shown in the Form of Tender shall remain unaltered but the nett aggregate amount of the
difference between the total adjusted amount in the Summary of the Bills of Quantities and the
tender amount shown in the Form of Tender, whether a nett deduction or nett addition, shall be
calculated as a percentage of the total adjusted amount shown in the Summary of the Bills of
Quantities and all prices and/or rates throughout the Bills of Quantities shall be subject to such
percentage discounts or premiums as the case may be. Provided always that Provisional and
Prime Cost Sums shall be excluded from such calculation and shall not be subject to such
percentage discount or premium.

Standard Method of Measurement

26.4 The Bills of Quantities, unless otherwise expressly stated in respect of any specified item or
items, shall be deemed to have been prepared in accordance with the principles of the Standard
Method of Measurement of Building Works as published by the Institution of Surveyors
(Malaysia) or Civil Engineering Method of Measurement published by Institution of Civil
Engineers (London) or Method of Measurement as set out in Bill of Quantities.

Provisional Quantities

26.5 Unless where the quantities of the Works or any part thereof are stated as 'provisional' in the
Bills of Quantities such quantities are firm and the Works shall not be subject to re-measurement
unless the Bills of Quantities are proven to be erroneous and shall be dealt with under clause
26.1.

26.6 Where the quantities of Works are stated as "prOVisional" in the Bills of Quantities, such
quantities are the estimated quantities which shall not be taken as the actual and correct
quantities of Works to be executed by the Contractor in the fulfilment of his obligations under the
Contract. The amount to be paid to the Contractor in respect of such Works upon completion of
this Contract shall be ascertained by remeasurement of the work as it is actually executed and
valued in accordance with clause 25.1 hereof, after adjustment if necessary as provided in
clause 25.3 hereof.

26.7 For the purpose of clause 26.6, the amount to be paid to the Contractor shall be set off against
the amount for such work in the Bills of Quantities, and the balance shall be added to or
deducted from the Contract Sum as the case may be.

27.0 MEASUREMENT OF WORKS

27.1 The S.O. shall, when he requires any part or parts of the Works to be measured or remeasured
for the purposes of clauses of Variation under clause 24 and provisional quantities under clause
26.5, give reasonable notice to the Contractor who shall attend or send a qualified agent to assist
the S.O. or S.O.'s Representative in making such measurement and shall furnish all particulars
required by the S.O .. Should the Contractor fail to attend or neglect or omit to send such agent,
then the measurement made by the S.O. or approved by him shall be taken to be the correct
measurement of the work.

27.2 Upon the completion of the measurement pursuant to clause 27.1, the S.O. shall supply the
Contractor with such measurement in respect of the said parts.

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28.0 PAYMENT TO CONTRACTOR AND INTERIM CERTIFICATES

26.1 When the Contractor has executed work including delivery to or adjacent to the Works of any
unfixed materials or goods intended for incorporation into the Works in accordance with the
terms of this Contract and their total value of work thereof has reached the sum referred to in
Appendix, the S.O. shall at that time make the first valuation of the same.

26.2 Thereafter, once (or more often at the discretion of the S.O.) during the course of each
succeeding month the S.O. shall make a valuation of the works properly executed and of unfixed
materials and goods delivered to or adjacent to the Site, provided the total value of work properly
executed and the value of unfixed materials and goods as specified in clause 26.4 hereof,
delivered to the Site intended for incorporation into the Works in each subsequent valuation shall
not be less than the sum referred to in Appendix.

26.3 Within fourteen (14) days from the date of any such valuation being made and subject to the
provision mentioned in clause 26.1, the S.O. shall issue an Interim Certificate stating the amount
due to the Contractor from the Government. PROVIDED THAT the signing of this Contract shall
not be a condition precedent for the issue of the first Interim Certificate (and no other) so long as
the Contractor has returned the Letter of Acceptance of Tender duly signed and has deposited
with the S.O. or the Government the relevant insurance policies under clauses 15 and 16 hereof.

26.4 The amount stated as due in an Interim Certificate shall, subject to any agreement between the
Parties as to payment by stages, be the estimated total value of the work properly executed and
up to ninety percent (90%) of the value of the unfixed materials and goods delivered to or
adjacent to the Site intended for incorporation into the permanent Works up to and including the
date the valuation was made, less any payment (including advance payment) previously made
paid under this Contract. PROVIDED THAT such certificate shall only include the value of the
said unfixed materials and goods as and from such time as they are reasonably and properly and
not prematurely delivered to or adjacent to the Site and adequately protected against weather,
damage or deterioration.

26.5 This clause shall not apply to any unfixed materials and goods which are supplied and delivered
by Nominated Suppliers for which payment shall be made for the full value of the unfixed
materials and goods.

26.6 Within a number of days as stated in Appendix (or if none stated then within thirty (30) days·of
the issue of any such Interim Certificate), the Government shall make a payment to the
Contractor as follows:

(a) where the Performance Bond is in the form of a Banker's, Insurance or Finance
Company Guarantee, payment shall be made on the amount certified as due to the
Contractor in the said Interim Certificate; or

(b) where the Performance Bond is in the form of a Performance Guarantee Sum, payment
of ninety percent (90%) on the amount certified as due to the Contractor shall be made
with the remaining ten percent (10%) being retained by the Government as a
Performance Guarantee Sum. PROVIDED THAT when the sum retained is equivalent
to five percent (5%) of the Contract Sum then in any subsequent Certificate, payment
shall be made on the full amount certified as due to the Contractor.

29.0 ADJUSTMENT OF CONTRACT SUM

The amount to be added to or deducted from the Contract Sum in respect of expense or loss due to fees
and charges in relation to the supply of water and electricity and permanent connections to water,
electricity, telephone and sewerage mains under clause 6.2, variations under clause 24, rectification of
errors in Bill of Quantities under clause 26.3, fluctuation of price under clause 30, payment of P.C. Sums
and Provisional Sums under clause 34, opening up work for inspection and testing of materials or goods

20

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and executed work under clause 35.2, loss and expense under clause 44 and costs of disposal of fossils.
etc. under clause 64 hereof. shall be certified by the S.O.

30.0 FLUCTUATION OF PRICE

In accordance with the Special Provisions to the Conditions of Contract for Fluctuation of Price as
contained in Appendix (if applicable), the amount payable by the Government to the Contractor upon the
issue by the S.O. of an Interim Certificate under clause 28 hereof shall be increased or decreased
accordingly. The net total of any such increases or decreases shall be given effect to in determining the
Contract Sum.

31, FINAL ACCOUNT AND PAYMENT CER'rlFICATE

31.1 As soon as is practicable but not later than three (3) months after the issuance of the Certificate
of Practical Completion, the Contractor shall submit full particulars complete with receipts,
vouchers records that would substantiate the Contractor's claim under clause 44 together with
any documents. supporting vouchers and any explanation and calculations including documents
relating to the accounts of Nominated Sub-Contractors or Nominated Suppliers, which may be
necessary to enable the Final Account to be prepared by the S.O. PROVIDED ALWAYS the
Contractor had given the notice of claim in writing within the stipulated time or times in the said
provisions.

31.2 If the Contractor fails to submit full particulars of all claims within the stipulated period. the S.O.
shall forthwith make the assessment based on the available documents submitted by the
Contractor for the purpose of the Final Account. The Government shall be discharged from all
liabilities in connection with the claims.

31.3 Within three (3) months after the expiry of the Defects Liability Period for the whole of the Works
or three (3) months after the issue of the Certificate of Completion of Making Good Defects under
clause 48 hereof, whichever is the later, the S.O. shall issue the Final Certificate.

31.4 The Final Certificate shall be supported by documents, and full particulars complete with
receipts, vouchers records showing the S.O.'s final valuation of Works and any amount
determined in clause 31.1 in accordance with the terms of this Contract. After setting out or
allowing for all payments':or other expenditure of the Government or any permitted deductions
made by the Government or the S.O. on its behalf, the Final Certificate shall state any final
balance due from the Government to the Contractor or from the Contractor to the Government,
as the case may be, which shall thereupon become the debt payable. Such certificate shall also
take account of any outstanding permitted deductions not yet made by the Government under
the terms of this Contract whether by way of liquidated damages or otherwise.

31.5 No final payment due to the Contractor under the Final Certificate, shall be made unless and until
the Contractor shall have satisfied the S.O. by means of a Statutory Declaration made by or on
behalf of the Contractor to the effect that the workmen who have been employed by the
Contractor on the Works including workmen employed by sub-contractors, whether nominated or
otherwise (including "labour only" SUb-contractors) have received all wages due to them in
connection with such employment, and that all dues or contributions under the Employment Act
1955. the Employee's Social Security Act 1969, the Employee's Provident Fund Act 1965 and
any other laws relevant to the employment of workmen, have been paid.

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32.0 EFFECT OF S.O:S CER"I"IFICATES

No certificate of the S.O. under any provision of this Contract shall be considered as conclusive evidence
as to the sufficiency of any work, materials or goods to which it relates, nor shall it relieve the Contractor
from his liability to amend and make good all defects, imperfections, shrinkages, or any other faults
whatsoever as provided by this Contract. In any case, no certificate of the S.O. shall be final and binding
in any dispute between the Government and the Contractor if the dispute is brought whether before an
arbitrator or in the Courts.

33.0 DEDUCTION FROM MONEY DUE TO CONTRACTOR

The Government or the S.O. on its behalf shall be entitled to deduct any money owing from the
Contractor to the Government under this Contract from any sum which may become due or is payable by
the Government to the Contractor under this Contract or any other contracts to which the Government
and Contractor are Parties thereto. The S.O. in issuing any certificate under clauses 28 and 31, shall
have regard to any such sum so chargeable against the Contractor, provided always that this provision
shall not affect any other remedy to which the Government may be entitled for the recovery of such sums.

34.0 PRIME COST I PROVISIONAL SUMS

34.1 In respect of any and every Prime Cost or P.C. Sum provided in the Contract, the amount due to
any Contractor shall be determined by deducting the said Prime Cost or P.C. Sum and the
relevant profit and/or attendance charges from the Contract Sum and substituting for the same
with the actual amount due to relevant Nominated Sub- Contractor or Nominated Supplier as
valued in accordance with the relevant sub-contract and the sums due to any Contractor by way
of profit and/or attendance charges at the rates or prices stipulated in the Contract Documents (if
any).

34.2 The Provisional Sum may be expended at such times and in such amounts as the S.O. may
direct. Such sum if not used either wholly or in part shall be deducted from the Contract Sum.
The value of works which are executed by the Contractor in respect of Provisional Sums shall be
ascertained in accordance with clause 25 hereof. The said value of such work executed by the
Contractor shall be set off against all such Provisional Sums and the balance shall be added to
or deducted from the Contract Sum as the case may be.

34.3 Any work to be executed, or materials or goods to be supplied for which Provisional Sums are
provided in the Bills of Quantities may. if the S.O. so decides, be treated as P.C. Sum items and
shall be dealt with in accordance with clause 34.1.

34.4 Where the Contractor in the ordinary course of his business directly carries out works for which
P.C. Sums are provided in the Bills of Quantities and where such works are set out in Appendix
hereto and the S.O. is prepared to accept tenders from the Contractor for such works the
Contractor shall be permitted to tender for the same or any of them without prejudice to
Government's right to reject the lowest or any tender. If the tender of the Contractor for any work
included in the P.C. Sum is accepted, such tender shall be held to include the profit and
attendance charges, and the Contractor shall not be entitled to the profit and attendance charges
as contained in the Bills of Quantities notwithstanding any provision to the contrary under clause
34.1.

35.0 MA"rERIALS, GOODS AND WORKMANSHIP

35.1 All materials, goods and workmanship shall be of the respective kinds and standards described
in the Specification and of good quality and in accordance with the standard of the workmanship

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in the industry. The Contractor shall upon the request of the S.O. furnish him with the relevant
certificates and/or vouchers to prove that the materials and goods comply with the Specification.

35.2 The Contractor shall, entirely at his own cost, provide samples of materials and goods for testing
purposes. The Contractor shall, when instructed by the S.O. to open up for inspection any work
covered up, or arrange for or carry out any test of any materials or goods (whether or not already
incorporated in the Works) or of any executed work which the S.O. may in writing require and the
cost of such opening up or testing (together with the cost of making good in consequence
thereof) shall be added to the Contract Sum unless provided for in the Bills of Quantities by way
of Provisional Sums or otherwise or unless the inspection or test shows that the work, materials
or goods are not in accordance with this Contract.

35.3 The Contractor shall pay all duties and taxes which may be imposed by law, such as customs
duties and sales tax, on all materials, goods and equipment, whether purchased or imported in
the Contractor's name or his agent, which are incorporated in the Works or used directly in the
construction, completion or maintenance of the Works.

35.4 Except where otherwise specified, the Contractor shall pay all tonnage and other royalties, rent
fees and other payments or compensation (if any) for getting stone, sand, gravel, clay or other
materials required for the Works.

36.0 INSPECTION AND TESTING OF MATERIALS, GOODS AND EQUIPMENT

36.1 Further to his the Contractor's obligations under clause 10, the Contractor shall submit to the
S.O. for his approval, proposals for inspecting the design and setting out of the Works and
testing the materials and workmanship to ensure that the Contractor's obligations under the
Contract are fulfilled. .

36.2 The Contractor shall carry out the inspection and tests approved under clause 36.5 or elsewhere
in the Contract and such further tests as the S.O. may reasonably require, including to open up
for inspection any work covered up or to carry out any test of any materials or goods (whether or
not already incorporated in the Works or any executed Works).
,
36.3 The S.O may issue instructions to the Contractor to remove from the Site or rectify any work,
goods which are not in accordance with this Contract at his own cost.

36.4 The Contractor shall, as may be required by the S.O. from time to time, provide such aSSistance,
instruments, machines, labour and materials as are normally required for the purpose of
examining, measuring and testing of any work, as well as and the quality, weight or quantity of
the materials used, and shall supply samples of materials before incorporation in the Works for
testing.

36.5 Unless the Contract otherwise provides, the cost of making any test shall be borne by the
Contractor if such test is:

(a) proposed by the Contractor; or

(b) clearly intended by or provided for in the Contract.

36.6 Notwithstanding anything in clause 36.5, if the Contractor carries out any further test as required
by the S.O. pursuant to clause 36.2 and the result of such test shows the workmanship or
materials is not in accordance with the provisions of the Contract, then the cost of such test shall
be borne by the Contractor. But if the result of such test shows the workmanship or materials
comply with the provisions of the Contract, then the cost of such test shall be borne by the
Government.

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Pwd 203 a rev2007

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Pwd 203 a rev2007