Notice of intention to claim for loss and expense

Abstract

Any event which disturbs and prolongs the project time or causing the project cost increase will make the aggrieved party to claim for loss and expense. Notification is one of the problems identified in managing claim for loss and expense in Malaysia construction industry. Before the claim to be successful the aggrieved party must follow the precondition or clause provision as stipulated in the conditions of contract. The purpose of this study are to identify the issues pertaining to notice of intention to claim for loss and expense claim and to identify judicial decision of defective notice of intention to claim for loss and expenses in construction contract. This research was conducted based on data analysis from judicial decision. International cases and local cases have also been reviewed. Lexis Malaysia web site was used as the research instrument. Thirteen (13) related cases pertaining notices on loss and expense issues have been analysed. The finding from the research shows that there are four (4) main issues usually brought to the judicial decision. The very pertinent issues are failure to the contractor submitting the notices within the time stipulated, secondly issue pertaining notice procedure, thirdly the ambiguity of the clauses itself especially for bespoke or tailored agreement and fourthly the duty of care issues by the contract administrator. This research also has found out that the judicial decision is not in uniformity in making the decision pertaining defective notices. Assessing notice of event for loss and expense also is the most critical part and this research found that claim have been rejected because of not following notice requirement. It is important for the construction industry players and contract practitioners to be well versed in the issues which are brought to the judicial decision. Contract administrator must has a higher understanding how to handle early notice when disrupted event occur and dealing with loss and expense claim fairly and proper manner.