PRESIDENT MESSAGE – AUGUST 2019

The month of August is another busy month for MBAM as we organise the MBAM Affiliate Dialogue 2019 and the 65^th MBAM Anniversary Dinner on 16 August 2019. It is a great platform and place of gathering for all key industry players to come together and celebrate another milestone for MBAM.

Last month, there were also a few key events that I wish to highlight and share with all of you readers:

MBAM Conference on Current Contract Administration Practices Contract Administration Practices in the Malaysian Construction Industry and Potential Solutions

On 10 July 2019, MBAM Contracts and Practices Committee organised a Conference on Current Contract Administration Practices in the Malaysian Construction Industry and Potential Solutions. The full day Conference which was held at Holiday Villa Subang was attended by more than 130 participants. The keynote address was delivered by Yang Arif Dato’ Lim Chong Fong, High Court Judge who also launched the MBAM Mediation Services for MBAM members.

Keynote Address by YA Dato’ Lim Chong Fong, High Court Judge

There were in total four sessions with the following topics:

Session 1: Overview on Contract Administration Practices in the Malaysian Construction Industry

Session 2: Update on CIPAA and Case Study

Session 3: Mediation Success Story in Singapore – Contractors’ Perspectives

Session 4: Moving Forward with Practical Solutions for Disputes

In Session 1’s presentation, Ar Tiong Kian Boon said that the Contract administrator (CA) is a position created by a specific act in the contract. Building Contract creates a unique CA who acts on behalf of the employer and also as a neutral person managing and interpreting the contract. The CA in Building Contract is created by the Building Contract, responsibilities commenced before the CA comes in existence. In fact, he stated that the Malaysian Construction Industry is a “Dispute Prone Industry”.

In Session 2, Chan Kheng Hoe begin by stating that CIPAA was introduced to provide a “mechanism for speedy dispute resolution through adjudication”. It changed the landscape of dispute resolution in Malaysia, because for the first time, we were introduced to the concept of “rough justice”, where decisions are only of “temporary finality”, and parties can always re-litigate every dispute. In fact, CIPAA has changed the “slow and steady” process of dispute resolution into a “fast and furious” one. In the beginning, it was paradise (for the Claimant). In the beginning, the Court saw everything that Parliament made with CIPAA, and the Court declared that it was good. The attitude of the Court in the beginning was to overwhelmingly support CIPAA, to the point that one may even be almost immediately discouraged upon receiving a Payment Claim.

In Session 3, speaker Lee Kok Eng explained that the Singapore Construction Mediation Centre (SCMC) is a wholly-owned subsidiary of the Singapore Contractors Association Limited (SCAL). The SCMC was launched on 12 March 2019. The SCMC is to align with one of SCAL’s new strategic thrusts to remain relevant and develop services catered to their members’ needs. The objective of SCMC is to encourage mediation as the preferred dispute resolution process in the settlement of construction disputes. SCMC will provide SCMC members an effective and cost-efficient channel where amicable and early settlement of disputes will eliminate lengthy and costly court proceedings. SCMC’s Vision is to be the Mediation Centre of Choice for amicable dispute resolution of the construction industry and its mission is to foster a conciliatory environment in the construction industry through the provision of mediation for amicable settlement of disputes.

In Session 4, Sr Dr Ong See Lian gave an overview of the contracting system and of the consultants’ fee structure and the impact of when the lowest price gets the job. Furthermore, there are incorrect or imbalanced allocations of risks in standard forms of contract and unrealistic expectations of the parties. This is compounded by degradation of the quality of service. Disputes can also manifest due to lack of planning, failure to deal promptly with changes or unexpected conditions, macho or litigious mentality. Furthermore, there is a pattern of the adversarial approach to dispute resolution namely with the choices or arbitration or litigation. Furthermore, the traditional method of procurement, in particular sub-contracting with the culture of squeezing all the way down has contributed to the problem within our contracting system.

After the presentation sessions, there was a Forum Sharing Session moderated by MBAM Vice President and Chairman of MBAM Contracts and Practices Committee, Oliver Wee and his panellists were Sr Dr Ong See Lian; Lee Kok Eng; Chan Kheng Hoe; International Arbitrator and Member of 39 Essex, Tan Swee Im; Member of International Chamber of Commerce, International Court of Arbitration, Rajendra Navaratnam and Principal Architect of Studio Reka, Ar Lim Fang Keong.

The event not only saw the launching of MBAM Mediation Services for MBAM members but also a presentation of certificates to our panel of mediators who are contributing their time and expertise to assist our members. Mediation is a non-adversarial structured process used to resolve disputes and disagreements using a Mediator as a neutral third party to facilitate settlement. Mediation is often used before resorting to adversarial methods such as adjudication, arbitration or court proceedings and is designed not only to resolve disputes but also to preserve and re-establish relationships. To be successful, there must be a mutual commitment by all parties to make the process work.

Presentation of Certificates to MBAM Mediators Term 2019/2020

Unlike a judge, arbitrator, or adjudicator, the Mediator will not impose a decision on the parties but instead will help the parties achieve a mutually agreed settlement. In addition, mediation is a form of Alternative Dispute Resolution (ADR). It is hoped that with mediation contractors will have more options and remedies at their disposal and hopefully be able to lower down overall cost of doing business as lately contractors have been spending a lot of time and money on legal fees.

MBAM Vice President and Chairman of Contracts & Practices Committee, Oliver Wee and YA Dato’ Lim Chong Fong, High Court Judge together with forum panellists

After the forum session, souvenirs of appreciations were presented to all panellists and speakers and a networking session with participant ensued after that. Overall, it was an interesting conference with the aim to encourage members to utilise MBAM Mediation Services and MBAM hopes more members would participate in future events organised by the MBAM Contracts and Practices Committee.

Penang International Construction Conference 2019

The first Penang International Construction Conference (PICC) 2019 was launched successfully by Penang Chief Minister, YAB Tuan Chow Kon Yeow on 18 July at The Top Penang @ Komtar. This 2 days conference jointly organised by Master Builders Association Malaysia (MBAM) and Penang Master Builders & Building Materials Dealers Association (PMBBMDA), with the theme “Safety and Innovation” attracted over 200 participants.

Penang Chief Minister, YAB Tuan Chow Kon Yeow’s speech during PICC Opening Ceremony

Penang Chief Minister, YAB Tuan Chow Kon Yeow in his speech emphasised on the importance of the theme chosen at the right time as it is a crucial moment in Penang’s development. With few mega projects in the pipeline such as Penang Transport Master Plan (PTMP), Penang South Reclamation (PSR), Penang Tunnel and Penang Airport Extension, the State government is aware of the requirement on specialist technology and also strong emphasis on Work Safety as it involves construction along developed areas, hill slopes and construction in the sea.

According to YAB Tuan Chow, the construction industry must learn from the best and adopt the latest trends and applications to ensure a safe, environmental-friendly and efficient construction industry.

During the PICC 2019 Opening Ceremony

There were 10 paper presentations presented by industry experts who covered on different aspects relating to the theme of “Safety and Innovation”, namely:

• Paper 1: Safety Challenges in Design and Construction – Jakarta Elevated Toll Road.
• Paper 2: Slope Disaster Prevention in Hong Kong: Past, Present and Future.
• Paper 3: Introduction to New Guidelines on Occupational Safety and Health in Construction Industry (Management) (OSHCIM).
• Paper 4: Slope Failures: Lesson Learnt – Way Forward.
• Paper 5: Safety Technology in Construction.
• Paper 6: Adoption of Industrialised Building System (IBS) in Today’s Construction.
• Paper 7: OSH Challenges in MRT Construction – Light at the end of the Tunnel.
• Paper 8: CIDB’s Role in Promoting Safe Construction Work and Culture in Construction Industry.
• Paper 9: Introduction to SOCSO’s Employment Services.
• Paper 10: Virtual Design Construction (VDC) Process – Technology for Safety in Construction.

Also present at the Opening Ceremony were President of Penang Master Builders & Building Materials Dealers Association (PMBBMDA), Dato’ Lim Chee Tong and Director General of Department of Occupational Safety and Health Malaysia (DOSH), Ir Haji Omar Bin Mat Piah.

2019 Scholarship Awards Presentation

The MBAM Education Fund Scholarship 2019 presentation ceremony was held during the MBAM Golf Tournament 2019 event on 20 July 2019 at Kota Permai Golf and Country Club This year, MBAM awarded 10 scholarships for undergraduate studies of which two scholarships were sponsored by Lighthouse Club Kuala Lumpur and one was sponsored under MBAM – Koon Yew Yin scholarship. Collectively, the total scholarships for the new recipients over their duration of studies is RM255,000 and up to date, we have disbursed almost RM2.52 million for scholarships. Todate, the total number of scholarship recipients who benefited from MBAM Education fund is 152. MBAM Honorary Advisor (Education) cum Chairman of Education Fund board of Management, Chua Siow Leng accompanied MBAM President, Foo Chek Lee to stage to give away the scholarship awards to the students. President of Lighthouse Club Kuala Lumpur (LHCKL), Ronan Collins presented to two students under the MBAM-Lighthouse Club Education Fund Scholarship Award.

There were two scholarship recipients who graduated with a first class honours in their studies in 2018. We hope this will inspire the current and new scholarship recipients to excel in their studies while actively involved in the extracurricular activities. The recipients of MBAM First Class Honours Award 2019 were Mohd Ridwan Naim bin Suhaime who graduated with Bachelor of Science (Hons) Architecture from Universiti Teknologi Mara while How Han Zhen graduated with Bachelor of Engineering (Hons) Civil Engineering from Universiti Malaysia Pahang.

Fourth from left: LHCKL President, Ronan Collins; MBAM President, Foo Chek Lee and MBAM Honorary Advisor (Education), Chua Siow

Lastly, I would like to take this opportunity to urge all MBAM Members to come join us at the upcoming Building & Construction Conference 2019 with the theme “Improving Competitiveness through Digitalisation” which will be held on 29 October 2019 at KL Convention Centre. Limited seats available. So get in touch with MBAM Secretariat today!

I would also like to wish everyone, Selamat Menyambut Hari Kebangsaan! Our founding promote unity, and harmony continue to ring true today, the foundation on which our country stands. We have prospered and succeeded due to these guiding principles. The Malaysian construction industry is part of a strong Malaysian community. Let us raise our Malaysian flag high to honour our country and celebrate our achievements towards nation building together.

FOO CHEK LEE JMW

MBAM President