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Topic 1-2

Contract & Tendering

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Contract & Tender

Communication and tender as invitation to treat


Tender process and tender document
Preliminary & General condition
Specification
Bill of quantity
Implementation of contract and project monitoring
Claim & certification, and standard method of
measurement
Variation order, completion, dispute resolution

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Basic Construction contract, contract
document:-
Offer
Acceptance
Consideration

Tender is not an offer


Tender submission is an offer
After signing Letter of Award is an acceptance

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At this time, Client will approach respective experts
to ready with:-
Architect Architecture drawings
C&S Consultant C&S drawings
M&E Consultant M&E drawings
QS Bill of Quantities

By complying to Uniform Building By-Laws 1984

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All buildings must COMPLY to Laws of Malaysia:-
Uniform Building By-Laws 1984
Part I - Preliminary
Part II - Submission of plans for approval
Part III - Space, Light and Ventilation
Part IV - Temporary Works in connection with
building operations
Part V - Structural Requirements

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All buildings must COMPLY to Laws of Malaysia:-
Uniform Building By-Laws 1984
Part VI - Constructional requirements
Part VII - Fire requirements
Part VIII - Fire alarms, fire detection, fire
extinguishment and fire fighting process
Part IX - Miscellaneous

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At the same time, Client office will start preparing:-

Construction Contract and Contract


Document for tendering purpose

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The elements of contract comprises of:-

Definition
It defines the main duty for:-
Architect
Consultants (C&S, M&E, QS)
Contractor
Domestic Sub-Con (DSC), Nominated Sub-Con
(NSC)

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The elements of contract comprises of:-

It consists of:-
Form of tender
Article of Agreement
LA (Letter of Award)
Appendix to the Conditions
Bill of Quantities
Specifications
Drawings
Schedule of Rates

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Form of tender

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Article of Agreement

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ITEM DESCRIPTION UNIT QTY. RATE AMOUNT
(RM) (RM)

ELEMENT NO. 2 - WORK BELOW LOWEST FLOOR


FINISH

Excavate commencing from existing platform level, get


out, part return, fill in and ram and deposit in making
up levels where directed within the site and remainder
load and cart away to Contractor's dumping ground

A Oversite to reduce level m3 1173 10.00 11,730.00

Excavate commencing from reduce level, get out, part


return, fill in and ram and deposit in making up levels
where directed within the site and remainder load and
cart away to Contractor's dumping ground

B Pit for pad footing not exceeding 1.50m deep m3 273 10.00 2,730.00

C Pit for stump footing (S1) not exceeding 1.50m deep m3 8 10.00 80.00

D Pit for lift pit not exceeding 1.50m deep m3 27 10.00 270.00

E Ditto exceeding 1.50m and not exceeding 3.00m deep m3 15 12.00 180.00

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Quanti Amount
Item Description Unit Rate (RM)
ty (RM)

D ELECTRICAL INSTALLATION

1 To supply and install light fitting complete


with all necessary accessories as below:

a)1x18W bare channel fluorescent fitting.


Similar to Davis Slimline Batten LP118 or
equivalent. L.S.
b)1x36W bare channel fluorescent fitting.
Similar to Davis Slimline Batten LP136 or
equivalent. L.S.
c)2x36W bare channel fluorescent fitting.
Similar to Davis Slimline Batten LP236 or
equivalent. L.S.
d)1x36W fluorescent fitting complete with
square diffuser. Similar Davis Slimline
Batten LPS136 or equivalent. L.S.

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15.0 LIST OF MATERIAL/CATELOGUE SUBMISSION

Brand/Su
plier
Brand/Supplier
ITE Material Brand/Supplier as stated in the as stated
(Contractor
M Description BQ (APPROVED BY SJMC) in the
Proposed)
Specifica
tion

ELECTRICAL
1
SERVICES
a H. T. Switchgear ABB, MG, GE, SIEMEN or Eq.
TESAR, TRIHAL, SIEMENS,
b Transformer
SUNTEN or Eq.
c Generator Set CATERPILLAR or Eq.
d Bus Duct BICC, SQUARE D or Eq
LV MSB/Bub SMB, SRS POWER,
e
Switchboards COPPERTECH or Eq
f Distribution Boards HAGER, SMB, SRS, or Eq.

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Specifications

Its a guidance on the requirements for:


Materials to be used
Installation accessories

Criteria of Compliance
Sampling
Method of testing
Tolerance

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Specifications

It consists of:-
a. Architectural Specification.
Eg. Detail of work done, sampling and method of testing
etc.

b. C&S Specification
Eg. Concrete cover, overlapping steel, link type & size etc.

c. M&E Specification
Eg. Type of cable, Brand of DB and genset, Testing &
commissioning etc.

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Drawings

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Other Tender Drawings
Earthwork drawing

Piling drawing
Drainage drawing

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Other Drawings
Authority drawing
(Syabas, Hydrant,
TNB) etc
Fire Protection
System drawing
Plumbing Services

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And,

Schedule of Rates
Rate to provide for future references for
addition or omission work

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In the Condition of Contract, It also includes :-

Performance guarantees
Bank Guarantee To ensure the Company is clean and
financially capable to carry out the work

Claim and certification


Contractors duty to submit the claims based on BQ
Material on site
Standard method of measurement
Retention sum

Variation order (VO)

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Commencement, completion and defect liability
Clearly indicate the duration for the overall project
and defect liability period

Extension of time Additional time requires due to


uncertainty

Variation of the contract Additional work(s) which


not in the Tender document

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Insurances & public safety
Refer to project, team, individual
that involve in the particular
project

Dispute & resolution In such a case when the activity carry out
not comply to the requirements as in contract document

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Last but not least, It also includes :-

Form of tender
Important document to show the interest of tenderer
with the companys authorized signature.

Preliminaries and General Condition


The necessary costing and works to be carry out prior
to the main works.
Eg. Site setting up, erecting site accommodation,
relocation of existing services, Mobilization etc.

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Preliminaries and General Condition
It describes the information relating to the Works
as whole.
Contractors general cost, provision sums and
work by others
Law requirement
Submission requirement
Explanation of condition of contract
A general summary
General site summary
Insurance and bond requirement
Maintenance requirement

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Preliminaries and General Condition (Continued)

Pre-construction information
Progress claim method
Progress report
Site waste management
Work scheduling
Utility application & installation
Safety & Health Management
Quality Management
and so on

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Form of Contract
PAM 2006
IEM Form of Contract
P.W.D Form of Contract
CIDB Form of Contract

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Certification
CPC - Certificate of Practical Completion
Issued by the architect (Superintendent Officer (SO) to the
main contractor
Architect satisfies with all the physical works being
completed in the building.
CPC might includes getting all the supporting documents
from all relevant authority for the application of CF (Certificate
of Fitness) such as bomba, tnb, syabas, TM, local council
(forgotten how many departments in total), JPS (road and
drainage), IWK (sewerage) and a few more.
Main contractor able to claim for the release of 1st 2.5% of
the 5% retention sum

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Certification

CMGD - Certificate of making good practice


Issued by the SO after they're satisfied with the
making good of defects once the defect liability period
expired.
Contractor get their 2.5% 2nd moeity upon issuance of
CMGD
Release final certificate

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You are now ready to compile
tender document
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In general, the contract planning, scheduling & Implementation
process as follow:-
Planning & Scheduling HR & Material planning
stage Financial planning
Appointment of Subcon
& suppliers

Physical works Work monitoring &


implementation inspection
Quality Safety
control procedures

Completion and handling Dispute & resolution


over T&C
Claim &
certification

Defect liability and


maintenance

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After compiling, you can now call for
tendering

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The main purpose of tendering to:-

Choose the best party to perform quality


construction work with minimum cost, minimum
maintenance and operating cost, and in the
shortest duration.

Risk management

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Invitation for tender
Not consider as an offer
Tender submission is an offer
Client has no obligation to accept any tender

The types of tender involve:-


Open tender

Invited tender

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The selection may based on:
Financial qualified
Company size
Bank guarantee
Companys assets
Technically qualified
Expertise in the team
Qualification
Year of experience

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The selection may based on:

Mandatory requirement
CIDB, ISO, OSHAS, CONQUAS

Project in hand

Generally, the lowest bid price will always the


main concerned by the owner

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Other considerations:
Reputation of the company
Office & Site support
Performance
Word of mouth

Propose project duration (Turnkey)

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Others require information in tender document:-
Period of tender

Cost of tender

Detail of tender document

Qualification & minimum requirement of the


tenderers
Other requirements
Site visit
Soil data
Project data

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Shortlisted:-
Tender interview after 1st round of shortlisting

Tender clarification If the tenderer needs


more detail
Tender addendum any addition or omission
from client
Tender negotiation negotiating of price

Revise of tender after negotiation

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Letter of Award (LA)

Once everything is confirmed, Letter of Award


will be issued
Is an offer. Tenderer still has the right to
accept or reject.
The final document will supersede all
previous submission

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Bear in mind, all the discussion MUST:-
Documented in the letter and forming part of
the award
If involves new conditions, must clearly
stated in the letter of Award
All new scopes of work must be clearly spelt
out

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However, the offer could become invalid if:-
Exceed the period of offer

Rejected by tenderer

Revoke by client / offeror (after further


discussion within two parties)
Counter offer

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However, the Contract is deemed to be Voidable
Contract if:-
Misrepresentation

Fraud

Illegal

Lack of capacity to Contract

Duress or coercion

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Kick of meeting work starts

Congrats
on your new Project

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CONCLUSION FOR CONTRACT & TENDER

Topic discussed:
Communication and tender as invitation to treat
Tender process and tender document
Preliminary & General condition
Specification
Bill of quantity
Implementation of contract and project monitoring
Claim & certification, and standard method of
measurement
Variation order, completion, dispute resolution

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