CONSTRUCTION LAW AND

CONTRACT
Assoc Prof Dr Aminah Md Yusof
Faculty of Civil Engineering

Universiti Teknologi Malaysia

LECTURE AGENDA

MEETING

CONTENT

Introduction to Malaysian legal System

Introduction to Tort Trespass

Negligence Principles

Negligence

Professional Negligence

Contract

Test

Contract

MALAYSIAN LEGAL SYSTEM

LAW IN PERSPECTIVE

History

What is
law?
Why?

Where do our
laws come
from?

Who make
our laws
and how?
How do these laws
administrated? By
whom

What sorts of
laws do we
have?

MALAYSIAN LEGAL SYSTEM

AN INTRODUCTION TO LAW
THE NEED FOR LAW
MALAYSIAN LEGAL SYSTEM HISTORY
LAW, STATE AND CONSTITUTION
CLASSIFICATION OF LAW
SOURCES OF MALAYSIAN LAW
JUDICIARY SYSTEM
INTERFACE OF THE LAW WITH THE
CONSTRUCTION INDUSTRY

WHAT IS LAW?
The body of enacted or customary rules recognized
by a community as binding.
Sir John Salmon: Law as a body of principles
recognized and applied by the state in the
administration of justice.
Law consists of the rules recognized and acted on
by courts of justice.
Law may be defined as a body of rules, which are
enforced by the state.
John Austin: Law as a command set by a superior
being to an inferior being and enforced by sanctions
(punishment). The superior is being the state and
the inferior being is the individual. The sanctions are
wide and include imprisonment, fines, damages,
injunctions and decrees of specific performance.

WHY LAW?

A FRAMEWORK OF
RULES AND
INSTITUTIONS WITHIN
A NATION AND
REGULATING
INDIVIDUALS
RELATION WITH
OTHER AND BETWEEN
THEM AND THE
GOVERNMENT

LAW IN MALAYSIA - HISTORY

NATIVE LEGAL SYSTEM (NEGRITO, SENOI
AND MALAY ABORIGIN)
THE FOUNDING OF MALACCA SULTANATE
THE SPREAD OF ISLAM TO SOUTHEAST
ASIA
THE EXTENSION OF BRITISH COLONIAL
RULE

LAW, THE STATE AND

CONSTITUTION

PENINSULAR, SABAH & SARAWAK ONE UNIT

POLITICAL BUT NOT SAME SET OF LAW
TWO COMMON LINKS
PARLIAMENT

(CAN AND DOES LEGISLATE

COUNTRY)
FEDERAL COURT FINAL COURT OF APPEAL

State

Malaysia (International) 13 states

Written Constitution Federal Constitution
as supreme law. Article 4(1)

SEPARATION POWER
1.

EXECUTIVE

2.

LEGISLATURE

3.

LAWS ADMNINISTRATION
CABINET SYSTEM CABINET MEMBER ELECTED AND
SELECTED- APPOINTMENT BY KING ON THE ADVISE OF PRIME
MINISTER. COLLECTIVE RESPONSIBILITY- RESPONSIBLE TO
PARLIMENT
COMPOSITION KING (YDPA), UPPER HOUSE AND LOWER
HOUSE (DEWAN NEGARA AND DEWAN RAKYAT) MEMBER OF
PARLIMENT
MAKING LAW, AMMEND FEDERAL CONSTITUTION, MONITOR
CABINET, PROTECT PUBLIC INTEREST, TAXES.

JUDICIARY

COURTS FEDERAL, APPEAL, HIGH COURTS

INTERPRETE LAW, DECLARATION THE INVALIDITY OF LAWS,
INTERPRETE WRITTEN LAWS, DETERMINE WHETHER SUBLEGISLATION IS ULTRA VIRES OF ORIGINATED LAWS
JUDGE APPOINTMENT BY YDPA

SOURCES OF LAW

UNWRITTEN
ISLAMIC LAW
CUSTOMARY LAW
JUDICIAL DECISIONS
ENGLISH COMMON LAWS

WRITTEN
CONSTITUTION FEDERAL &
STATE AMMENDMENT???
LEGISLATION- MAKING
SUB-LEGISLATIONDELEGATED

SOURCES OF MALAYSIAN LAW

WRITTEN:

CONSTITUTIONS
LEGISLATIONS

FEDERAL & STATE

REGULATIONS/SUBLEGISLATIONS

UNWRITTEN
PRINCIPLE

ENGLISH LAW
JUDICIAL DECISIONS
CUSTOMS / WAY OF LIFE
ISLAMIC LAW

WRITTEN LAWS- FEDERAL

CONSTITUTION

The supreme law of Federation as in Article

4(1) of the Federal Constitution states:

This constitution is the supreme law of the Federation

and any law passed after Merdeka Day which is

inconsistent with this Constitution shall, to the extend of
the inconsistency be void.
It is the supreme law of the country.
It lays down a power of Federal and State Governments.
It enshrines the fundamental rights of the individual.
It can only be changed by a two-thirds majority of the
total number of the legislature.
It comprises Articles, which provide items such as the
name of federation, religion, fundamental liberties,
citizenship, election, judiciary power etc

LEGISLATIONS
1.

It is refer to law enacted by a body

constituted for this purpose.
In Malaysia, laws are legislated by Parliament
(State Legislative Assemblies).
Laws enacted by Parliament before 1957 are
known as Ordinances. Prior the Independence
laws enacted are called Acts.
Laws enacted by State Legislative Assemblies
are called Enactments (Sarawak Ordinances)
Subject matter for legislation is divided
between state and parliament. Parliament
competent to enact List I of Ninth Schedule,
State (List II) and List III are within the
concurrent competence of both.
The source becomes important than the case
law or precedents.
It is increasingly used as a mean of repealing,
amending, enacting or codifying the law.

SUB -LEGISLATIONS

Any proclamation, rule, regulation,

order, notification, by-law or other
instrument made under any ordinance,
enactment or lawful authority and
having legislative effect.
It is important as legislation detailing
the
Parliament
and
the
State
legislature to govern everyday matter
Any contravention of either a parent
Act of the Constitution is void.

HOW THE MALAYSIAN LAWS ARE MADE?

DEWAN RAKYAT - House of Representative lower

house
DEWAN NEGARA/ SENATE upper house
Parliament will exercise its power to make laws by
the passing of Bills in both Houses
How? What is Bill?
Private Bills affecting limited or particular
persons, groups or associations introduced by
any member of legislature or minister or
assistant minister
Hybrid Bills issue appear to affect individual
rights or interest adversely
Government Bills matters on government policy,
general applications and introduced by minister

HOW A BILL BE A LAW..

FIRST READING A BILL
INTRODUCED INONE OF THE
HOUSE. TITLE READ. AS
PASSED, TEXT PRINTED &
DISTRIBUTED

SECOND READING MEMBERS

DEBATE THE BILL. IF ACCEPTED,
IT IS PASSED ON FOR
CONSIDERATION BY A
COMMITTEE OF THE HOUSE

THIRD READING- DEBATES

TAKES PLACE & AMMENDMENT
MAY BE PUT TO A VOTE. THE
HOUSE EITHER DEFEAT OT
PASSES THE BILL

A COMMITTEE OF HOSUE
CONSIDERED THE BILL IN
DETAIL. REPORT ON IT
PREPARED. AS THE REPORT
APPROVED, BILL GOES FOR
THIRD READING IN THE HOUSE

AS PASSED IN ONE HOUSE IT IS

PASSED TO OTHER HOUSES FOR
SAME PROCESS. IF
AMMENDMENTS OCCUR THE
BILL MUST RETURN TO FIRST
HOUSE FOR ITS APROVAL

ROYAL ASSENT WHEN IT IS

PASSED BOTH HOUSES, ROYAL
ASSENT OF YDP AGONG
REQUIRED TO MAKE BILL A LAW

UNWRITTEN - ENGLISH LAWS

It

forms part of the laws of Malaysia.

It can be found in the English common
law and rules of equity.
Earlierthe
application
without
modifications
Further development the application of
the law of England throughout Malaysia is
subject to two limitations: (i) it is applied
in the absence of local statutes on the
particular subjects and (ii) only part of the
English laws that suited to local
environment render necessary.

JUDICIAL DECISIONS

Can be found in the judicial decisions of the High Court,

Court of Appeal and the Federal Court and then the
Supreme Court, Federal Court and the Judicial Committee of
the Privy Council.
Doctrine of binding judicial precedent called stare decisis, is
practised in England, Malaysia and other common law
countries.
Advantages of precedent:

The law evolved is more practical actual experiences

More flexible compared to statute law enacted
Parliament (which can be amended)
Case law is richer in legal detail than statute law

by

Disadvantages

A greater research needed as the number of cases increased

Difficult to tell whether a particular statement in a
judgement is ratio or dicta.

CUSTOMARY LAWS

Customary Laws - West Malaysia

Undang-undang Adat Melayu (tradition) ~ elements
i)
Undang-undang Adat Melayu Purba

Adat Pepatih
Adat Temenggung

ii) Undang-undang Hindu

Dharmasutra (buku undang-undang berbentuk prosa)
Dharmasastra (buku undang-ungang berbentuk puisi)

ORGANISATION OF CIVIL COURT

FEDERAL COURT
SUPERIOR
COURTS

COURT OF APPEAL
HIGH COURT
OF MALAYA
SESSIONS COURT

MEGISTRATES
COURT

HIGH COURT OF
SABAH & SARAWAK
SESSIONS COURT

JUVENILE MEGISTRAT
COURT
ES COURT JUVENILE
COURT
PENGHULUS
COURT

SUBORDINATE
COURTS

THE MALAYSIAN JUDICIARY

FEDERAL
TO

COURT:

THE EXCLUSION OF ANY OTHER COURT.

DETERMINE VALIDITY OF LAW MADE BY
PARLIAMENT/STATE
EXCLUSIVE JURISDICTION TO DETERMINE
DISPUTE BETWEEN STATES & FEDERAL
ULTIMATE COURT IN CIVIL, CRIMINAL AND
CONSITUTIONAL MATTERS

JUDICIARY cont.
COURT OF APPEAL ARTICLE 121 (1B) FEDERAL
CONSTITUTION Court of Appeal with appellate
jurisdiction to hear both civil and criminal cases
High or Sessions Courts.
HIGH COURT:

Criminal:

The court has jurisdiction to hear cases

which carry the death penalty
Civil: To hear cases in respect of divorce, admiralty &
bankruptcy and company cases

courts
SESSION

COURTS

Criminal

all offences other than offences

punishable with death
Civil Cases: suit not > RM250,000
Suit

> RM250,000 but award <

RM250,000

MAGISTRATES

COURT

Criminal Cases
Civil cases

CLASSIFICATION OF LAWS

PUBLIC LAW
Constitutional law: lays down the rights of
individuals in the State. It deals with issues such
as supremacy of Parliament and right of citizens.

Criminal law outlines various offences committed

by individuals against the State. It aims at
punishing criminals and suppressing crime. The
law imposes on individuals the obligation not to
commit crimes. A crime is a wrong against the
State for which punishment is inflicted by the
State, the proceedings being brought by the
Public Prosecutor.

INTERNATIONAL LAW

Body of law which is composed for its greater

part of principles and rules of conduct which
States feel themselves bound to observe, and
consequently commonly do observe, in relations
with each other.

The law can be divided into;

Public International law, which prevails
between States.
Private international law (conflict of laws) is
a part of municipal law. It consists of the
rules that guide a judge when laws of more
than one country affect a case.

PRIVATE LAW
Private

law is concerns with matters that affect the

rights and duties of individuals amongst themselves.
Private or Civil law is intended to give compensation
to persons injured, to enable property to be
recovered from wrongdoers, and to enforce
obligations (contract and trusts).
Contracts are based on agreement. The law of
contract is the branch of private law, which
determines when a promise or a set of promises is
legally enforceable. The promises are to be enforced
form the contract. The essential elements of contract
should be fulfilled.

Torts are based on obligation imposed by law (legal

obligations). A tort is a civil wrong. It is the breach of
a general duty, which is imposed by the law (and not
agreed between parties). It is remediable by a civil
action for unliquidated damages.

A trust is an equitable obligation binding a person

(who is called a trustee) to deal with property over
which he has control (which is called trust property)
for the benefit of persons (who is called beneficiaries)
of whom he may himself be one and any one whom
may enforce the obligations.

LAWS IN CONSTRUCTION
WHAT ARE THEY
DOING IN
CONSTRUCTION?

LEGAL
ASPECTS!!!

WHO ARE
THEY?

CONTRACT!

OTHERS!!!!

INTERFACE OF THE LAW WITH THE

CONSTRUCTION INDUSTRY
THE

TYPICAL PARTIES

CONTRACTORS/SUBCONTRACTOR
ARCHITECT/ENGINEER
CONSTRUCTION

OWNERS(CLIENT)
SERVICE AND SUPPLY
ORGANISATION
LABOUR FORCE
LOCAL, STATE & FEDERAL
AUTHORITY
GENERAL PUBLIC

LAWS IN CONSTRUCTION
Realising dream through drawings
The reality about construction

Nature

of job
Nature of product
Process and procedure
Nature of involvement-relationship
Interaction with environment

NATURE OF INVOLVEMENT
THE

TYPICAL PARTIES

CONTRACTORS/SUBCONTRACTOR
ARCHITECT/ENGINEER
CONSTRUCTION

OWNERS(CLIENT)
SERVICE AND SUPPLY
ORGANISATION
LABOUR FORCE
LOCAL, STATE & FEDERAL
AUTHORITY
GENERAL PUBLIC

LIABILITY(IES) IN LAW..

TORT LIABILITY NOT LIMITED TO THE CONTRACT

PROVISION
INTENTIONALLY OR UNINTENTIONALLY

CONTRACT LIABILITY
EXPRESS CONTRACT PROVISION
IMPLIED CONTRACT PROVISION

STATUTORY LIABILITY

STRICT LIABILITY

LIABILITIES IN CONSTRUCTION
Contract

liability: a participant is exposed to

potential liability and becoming a party to a legal

contract. Failing to conform to one or more of the
contract provision may lead to breaches of the
contract. The conditions of the contract may be in
the form implied (implicit) or express (explicit).

Tort

Liability:
Statutory liability:
Strict liability