Sub-Contract Agreement
An Agreement made the day of .. Between …., a company incorporated in Malaysia and having its registered office at… (hereinafter called “the Company”) of the one part And … (NRIC NO:………) practising under the name of …. and with an address at … (hereinafter called “the Architect”) of the other part.
WHEREAS:-
1. By letter dated … (the letter of appointment), the Company has been appointed the architect for the shop office, low-cost flats, multi-level carpark/food court (phase 1) in the proposed town centre, commercial and residential development on Lots .. (hereinafter called “the Employer”) for the fees as stated in the letter of appointment or such other sum as shall become payable under the letter of appointment.
2. The Company is desirous of engaging the Architect to manage and to carry out the whole of the Works under the letter of appointment (as hereinafter defined) upon the terms and conditions hereinafter set out.
NOW THIS AGREEMENT WITNESSETH as follows:-
1. DEFINITIONS AND INTERPRETATION
1.1 In this Agreement words and expressions used in the letter of appointment shall bear the same meanings when used herein except where the context otherwise requires.
1.2 The following words and expressions (set out in alphabetical order) shall have the meanings herein assigned to them unless the context, subject matter or content is inconsistent with such meanings.
“Consideration Sum” means the sum payable by the Architect to the Company as set out in Clause 15.
“Final Fee” means the sum ascertained and payable upon the completion of the Works and the expiry of the Defects Liability Period as the full amount of the total fees payable by the Employer to the Company for the architectural services rendered for the construction and completion of the Works and the expiry of the Defects Liability Period under the letter of appointment.
“Letter of Appointment” means the contract between the Employer and the Company dated … comprising the terms of engagement and all other documents described therein as forming part of the terms of engagement for the construction and completion of the Works up to the expiry of the Defects Liability Period in conformity in all respects with the provisions therein stated.
“Site Representative” means the person appointed by the Architect under Clause 7.1.
“This Agreement” means this Agreement together with such other documents as are referred to herein.
“Management Fee” means the sum payable by the Company to the Architect for all services to be rendered in the construction completion and making good of any defects whatsoever to the Works by the Architect in conformity in all respects to the provisions of letter of appointment which sum shall be the amount of the Final Fee less the sum payable to the Company by the Architect under Clause 11 herein.
1.3 The headings in this Agreement shall not be deemed to be part hereof or be taken into consideration in the interpretation or construction hereof.
1.4 Words importing persons shall include firms and corporations.
1.5 Words importing the singular only also include the plural and vice versa where the context requires.
2. GENERAL CONDITION
2.1 The Company hereby appoints the Architect to manage and carry out the Works up to expiry of the Defects Liability Period for the Works in conformity in all respects to the provisions of the letter of appointment and in accordance with the terms and conditions set out in this Agreement.
2.2 The Architect shall, subject to the provisions of this Agreement and to any terms and conditions which may be implied by law and in conformity with all the reasonable directions and requirements of the Company and with due care and diligence, manage and perform and carry out all services pertaining to the Works and provide all staff/labour including the supervision thereof, materials, and all other things whether of a temporary or permanent nature required in and for the carrying out of the services so far as the necessity for providing the same is specified in or is reasonably to be inferred from this Agreement.
2.3 The Architect shall not assign this Agreement or any part thereof or any benefit or interest therein or thereunder without the prior written consent of the Company and the Employer’s Representative.
3. LETTER OF APPOINTMENT
3.1 Unless expressly excluded or varied by the terms of this Agreement, all terms and conditions of the letter of appointment shall be deemed incorporated into this Agreement and made a part hereof and read as if the Architect were a party to the letter of appointment in place of the Company and the Architect shall be deemed to have full knowledge of all the terms and provisions of the letter of appointment and the Company shall provide the Architect with a true copy of the letter of appointment.
3.2 The Architect shall:-
(a) observe, perform and comply with all the provisions of the letter of appointment (and any amendment or variation thereto) on the part of the Company to be observed performed and complied with in relation to the Works and to be bound thereunder; and
(b) indemnify and save harmless the Company against and from any breach non observance and non-performance by the Architect or its agents of the provisions in the letter of appointment AND any act or omission by the Architect its servants or agents which involves the Company in any liability to the Employer under the letter of appointment or to any third parties in relation to the Works.
3.3 The Architect hereby acknowledges that any breach by the Architect of this Agreement may result in the Company committing breaches of and becoming liable in damages under the letter of appointment and all such damages, loss and expense are hereby agreed to be within the contemplation of the parties as being a probable result of any such breach by the Architect and therefore being the subject of the indemnity referred to in Clause 3.2(b).
3.4 As and when the Company shall receive any request instruction decision order notice confirmation in writing or any documents from the Employer in relation to the services to be rendered or any matter or thing pertaining to the letter of appointment the Company shall promptly notify and transmit the same to the Architect who shall in the name of the Company take such action as may be necessary in the circumstances.
4. MANAGEMENT FEE
4.1 The Management Fee payable to the Architect by the Company shall be the total fee stipulated in the letter of appointment less such payment to the Company as set out in Clause 15 herein.
4.2 All payments received by the Company from the Employer under the letter of appointment shall be credited by the Company into a separate bank account opened by the Company solely for the purposes of the Works and appoint the following persons as signatories thereto:-
1)
2)
3)
4.3 The Company shall cause the Employer to make all _payments payable under the letter of appointment into the aforesaid account with irrevocable standing instructions to disburse out from the said account a sum in favour of the Company for each tranche as specified in Clause…. and within the period therein stated.
4.4 Save for the sum payable to the Company as stated in sub-clause….. all monies in the said account shall be held in trust and for the benefit of the Architect absolutely. The Company further covenant and undertake that it will not suffer anything to be done whereby the bank account is garnished or subject to any form of attachment.
4.5 The Company shall within seven (7) days after its receipt by the Employer of each progress payment under the letter of appointment pay the same to the Architect in satisfaction of the Management Fee PROVIDED that the Company shall be entitled to deduct from each such progress payment the Consideration Sum in accordance with the terms set out in Clause 15 and any other sum which the Company is entitled under the terms of this Agreement to deduct therefrom. In the event that the amount in a relevant progress payment is insufficient to allow the Company to deduct therefrom the full sum which, under the provisions of this Agreement, the Company is entitled to so deduct, the Company shall be entitled to deduct from the next or subsequent progress payment any such balance due.
5. COMMENCEMENT AND COMPLETION
This Agreement shall be deemed to be effective as from the day of 199 and the Architect shall commence the Works immediately and shall proceed with the same with due diligence and expedition.
INSTRUCTIONS OF THE EMPLOYER’S REPRESENTATIVE
6.1 The Company undertakes to convey and despatch immediately to the Architect all instructions, correspondence(s) and memoranda received from the Employer in relation and pertaining to the Works.
6.2 The Architect shall in connection with the Works comply with all instructions and decisions of the Employer’s Representative which are notified to the Architect by the Company.
7. SITE REPRESENTATIVE AND CO-ORDINATOR
7.1 The Architect shall provide all necessary superintendence on Site during the carrying out of the Works and the Defects Liability Period. The Architect shall appoint a competent and authorised person who shall be a qualified person acceptable to the Employer and who shall be constantly in attendance on the Works and give his superintendence to the same. The Site Representative shall be in full charge of the Works and shall receive, on behalf of the Company and the Architect directions and instructions from the Employer. The Site Representative shall be authorised to correspond with the Employer and other relevant authorities in the name of the Company in matters pertaining to the Works PROVIDED that the Site Representatives shall not give any undertaking nor assume any liability on behalf of the Company without the prior written consent of the Company. The Architect hereby agrees and undertakes to indemnify the Company against all loss and expense suffered or incurred by the Company to the Employer or to any third party as a consequence of any act or omission of the Site Representative.
7.2 For the purposes of ensuring execution and progress of the Works in conformity with the provisions of the letter of appointment and this Agreement, the Company shall be entitled to appoint a Co-ordinator to act on its behalf in relation thereto. The duty of the Co-ordinator is merely to ensure progress of the Works in compliance with the letter of appointment and this Agreement and the Architect remains solely responsible for the proper execution and superintendence of the Works.
8. ALTERATIONS, ADDITIONS AND OMISSIONS_
8.1 The Architect shall make such variations of the Works whether by way of addition, omission, substitution, alteration, change in quality, form, character, kind, position, dimension, level or line and/or in the specified sequence, method or timing of construction (if any) as may be ordered by the Employer’s Representative and notified in writing to the Architect by the Company.
8.2 For the avoidance of doubt, it is expressly agreed that the Company shall not be entitled to any further fees except that as set out under Clause 15 if there are any variation or additional work ordered by the Employer. The Company shall hold all payments made in respect thereof in trust for the Architect.
9. NOTICES AND CLAIMS
9.1 Without prejudice to the generality of Clause 3 whenever the Company is required by the terms of the letter of appointment to give any information, return, account or notice to the Employer’s Representative or to the Employer, the Architect shall in relation to the this Agreement Works give a similar information, return, account or notice or such other information in writing to the Company as will enable the Company to comply with the terms of the letter of appointment and shall do so in sufficient time to enable the Company to comply with such terms punctually. Provided always however that the Architect shall be excused any non-compliance with this sub-clause for so long as he neither knew nor ought to have known of the the Company’s need for any such information, return, account or notice from him.
9.2 Subject to the Architect complying with the provisions of this sub-clause, the Company shall take all reasonable steps to secure from the Employer such financial benefits, if any, as may be claimable in accordance with the letter of appointment, and the Architect shall in sufficient time afford the Company all information and assistance that may be necessary to enable the Company to claim such benefits on the Architect’s behalf. On receiving payment of any such financial benefits from the Employer, the Company shall in turn make such payment to the Architect.
9.3 In the event of the regular progress of the Works being materially affected by any act, omission or default of the Company, his servants or agents, the Architect shall, as soon as such material effect becomes apparent, give written notice thereof to the Company and the amount of any direct loss or expense thereby caused to the Architect shall be payable to the Architect by the Company.
9.4 In the event of the regular progress of the letter of appointment Works being materially affected by any act, omission or default of the Architect, his servants or agents or any professional staff employed by the Architect on the this Agreement, the Company shall, as soon as such material effect becomes apparent, give written notice thereof to the Architect and the amount of any direct loss or expense thereby caused to the Company shall be payable to the Company by the Architect.
9.5 The provisions of sub-clauses 9.3 and 9.4 are without prejudice to any other rights or remedies which the Company or the Architect may possess.
10. PROPERTY IN MATERIALS AND PLANT
All drawings, designs, documents and the like prepared by the Architect in compliance with the Works contemplated under the letter of appointment shall remain the property of the Architect.
11. INDEMNITIES
11.1 The Architect shall at all times indemnify the Company against all liabilities to other persons (including the servants and agents of the Company or the Architect) for bodily injury, damage to property or other loss which may arise out of or in consequence of the (to the extent required by this Sub-Clause) execution and completion of the Works and against all costs, charges and expenses that may be occasioned to the Company by the claims of such persons.
11.2 The Company shall indemnify the Architect against all liabilities and claims against which the Employer by the terms of the letter of appointment undertakes to indemnify the Company and to the like extent, but no further.
13. INSURANCE, EPF AND SOCSO
13.1 The Architect shall take full responsibility for the care of the until all Works under the letter of appointment and the Defect Liability Period have been completed and expired respectively.
13.2 The Architect shall comply with the terms and conditions of the Employer’s Insurance and the procedures for claims notification and administration thereunder, and shall do nothing nor omit to do anything which might render any insurance voidable.
13.3 The Architect shall effect insurance against such risks as are necessary and on such terms and for the benefit of such persons as are necessary, and unless otherwise provided shall maintain such insurance from the time that the Architect shall first enter upon the Site for the purpose of executing the Works until he shall have finally performed his obligations under Clause 14 (Defects Liability Period).
13.5 The Architect shall bear sole responsibility in respect of all necessary registration under the Malaysian Social Security Scheme (Socso) and Employees Provident Fund (EPF) contributions in respect of its servants and employees.
14. DEFECTS LIABILITY PERIOD
After completion of the Works, the Architect shall provide all such services as are necessary until the expiry of the Defects Liability Period for the Works as the Company is liable to carry out under or to be inferred from the letter of appointment for the like period and otherwise upon the like terms as the Company is liable to do under the letter
of appointment.
15. CONSIDERATION SUM
As consideration for the Company appointing the Architect to manage and carry out the Works and in further consideration of any future services and attendances of the Company that may be necessary in respect of the Works, the Architect hereby agrees and undertakes to pay the Company a sum equivalent to …… per centum (…%) of the Final Fee less contingencies and any subsequent variation (hereinafter called “the consideration”) to be paid within seven (7) days after receipt of each payment from the Employer under the terms of the letter of appointment.
16.DETERMINATION OF THE WORKS
16.1 If before the Architect has fully performed his obligations under the this Agreement the employment of the Company is determined under the letter of appointment, the employment of the Architect under this Agreement shall also determine and thereupon the Architect shall with all reasonable speed remove his staff and equipment and materials (if any) from the Site.
16.2 Upon such a determination of the Architect’s employment, the other provisions of this Agreement shall cease to have effect and subject to sub-clause 16.3 hereof and payment to the Architect for services rendered/works executed up to the date of determination _shall only be made by the Company to the Architect upon the receipt by the Company from the Employer of the Final Fee PROVIDED that the Company shall be entitled to deduct from such payment any sum payable by the Architect to the Company under Clause 15 and any other sum for which the Company is entitled under the terms of this Agreement to deduct therefrom.
16.3 If the employment of the Company is determined or the letter of appointment is determined by the Employer in consequence of the Architect’s default, negligence, omission and/or indiligence, then the Company shall be entitled to claim against the Architect the Consideration Sum (which at the date of determination of the letter of appointment remains payable) and the Architect shall not be entitled to receive any sum on account of work done up to the date of termination of the letter of appointment until the full amount of the amount payable to the Company under this Clause 16.3 has been received by the Company from the Architect. PROVIDED that the sum receivable by the Architect for work done up to the date of determination shall not exceed the sum paid by the Employer to the Company under the letter of appointment upon determination of the letter of appointment.
17. DETERMINATION OF EMPLOYMENT OF THE SUB-CONTRACTOR BY THE COMPANY
17.1 If the Architect:-
(a) has become bankrupt or has a receiving order made against him or has presented his petition in bankruptcy or has made an arrangement where there is an assignment in favour of his creditors or has agreed to carry out the this Agreement under a committee of inspection of his creditors or (being a corporation) has entered into liquidation (other than a voluntary liquidation for the purposes of amalgamation or reconstruction) or has suffered or allowed any execution whether legal or equitable to be levied on his property or be obtained against him; or
(b) has assigned this Agreement without the consent in writing of the Company first obtained; or
(c) has failed to carry out his duties to the Employer’s satisfaction; or
(d) has, without reasonable excuse, fail to carry out proper and reasonable instructions pertaining to the Works for 14 days after receiving from the Employer’s Representative and/or the Company’s written notice to do so; or
(e) has failed to carry out his duties under this Agreement or pertaining to the Works with due diligence; or
(f) is not carrying out his duties in accordance with the this Agreement or is persistently or flagrantly neglecting to carry out his obligations under this Agreement; or
(g) has, to the detriment of good workmanship or in defiance of the Employer’s Representative’s and/or the Company’s instructions to the contrary, sub-let any part of this Agreement;
then in such event and without prejudice to any other rights or remedies which the Company may possess, the Company, after giving fourteen (14) days’s prior written notice to the Architect, may determine the appointment of the Architect under this Agreement provided that notice in pursuance of this Clause shall not be given unreasonably or vexatiously and shall be void if the Company is at the time of notice in breach of this Agreement.
17.2 The Company shall not be liable to pay to the Architect any money on account of the work done by the Architect up to the date of termination of this Agreement pursuant to Clause 17.1 until the receipt by the Company of the full Final Fee from the Employer and the expiration of the Defects Liability Period under the letter of appointment. The Architect shall then be entitled to receive only such sum (if any) as would be due to the Architect after deducting the said amount, but if such amount shall exceed the sum which would have been payable to the Architect then the Architect shall upon demand pay to the Company the amount of such excess and it shall be deemed to be a debt due by the Architect and shall be recoverable accordingly.
18. ARBITRATION
18.1 If any question, dispute or difference shall arise between the Company and the Architect out of or in connection with this Agreement or the carrying out of the Works, whether during the progress of this Agreement Works or after their completion and whether before or after termination, abandonment or breach of this Agreement, either party may give to the other notice in writing of the existence of such question, dispute or difference specifying its nature and the point at issue, and the same shall be referred to the arbitration of two arbitrators one to be appointed by each of the parties and who being so appointed shall appoint an umpire to whom, if the arbitrators fail to agree all matters in dispute, such matters shall be referred. If such appointment by either party is not made within fourteen (14) days after the service of the said notice, such arbitrator shall be such person as may be appointed by the President for the time being of the Institute of Architects, Malaysia on application by either the Company or the Architect. If the appointment of the umpire by the said two arbitrators is not made within one month after the date of appointment of the said two arbitrators, the umpire shall be such person as is appointed by the President for the time being of the Institute of Architects, Malaysia on application by either the Architect or the Company.
18.2 Notwithstanding Clause 19 (Language and Law), such arbitration and all matters relating thereto shall be conducted in accordance with and governed by the Arbitration Act 1952 or any statutory modification thereof, the hearing to be held in Malaysia and all awards to be published to the parties in Malaysia. The Courts of Malaysia shall have exclusive jurisdiction over all matters relating to the arbitration in respect of which in a Malaysian arbitration they are given jurisdiction by those Acts. Provided that if the question, dispute or difference to be referred to arbitration in connection with this Agreement raises issues which are substantially the same as or connected with issues raised in a related dispute between the Employer and the Company under the letter of appointment and if the related dispute has already been referred for determination to an arbitrator or arbitrators, the Company and the Architect hereby agree that the question, dispute or difference under this Agreement shall be referred to the arbitrator or arbitrators appointed to determine the related dispute and such arbitrator or arbitrators shall have power to make such directions and all necessary awards in the same way as if the procedure of the Courts of Malaysia as to joining one or more defendants or joining co-defendants or third parties was available to the parties and to him or them.
18.3 No steps shall be taken in the reference to the arbitration until after the completion or alleged completion of the Works unless with the written consent of the Company and the Architect.
18.4 In any such arbitration between the Company and the Architect, any decision of the Employer’s Representative or the Project Consultant which is final and binding on the Company under the letter of appointment shall also be and be deemed to be final and binding between and upon the Company and the Architect.
18.5 The award of any arbitrator or arbitrators appointed in accordance with sub-clause 18.1 shall be final and binding on the parties.
19. LANGUAGE AND LAW
19.1 This Agreement shall in all respects be construed and operate in accordance with the laws of Malaysia.
19.2 All correspondences and notices pertaining to the this Agreement shall be in English.
20. PARTIES DULY AUTHORISED
The parties hereto represent and warrant to one another that the transaction herein contemplated have been duly and validly authorised by all necessary corporate action where relevant on the part of each of them and each have full corporate power and lawful authority to execute and deliver this Agreement and to consummate and perform the transactions contemplated herein.
21. NOTICES
21.1 Any notice to be given to the Architect under the terms of the this Agreement shall be served by sending the same by post to or leaving the same at the Architect’s principal place of business (or in the event of the Architect being a company to or at its registered office).
21.2 Any notice to be given to the Company under the terms of the this Agreement shall be served by sending the same by post to or leaving the same at the address as given herein.
21.3 Either party may change a nominated address to another address in Malaysia by prior written notice to the other party.
22. AMENDMENTS
Amendments to or modifications of this Agreement may be made only by mutual agreement of the parties hereto in writing.
23. MISCELLANEOUS
23.1 In the event that any part of this Agreement shall be held invalid as contrary to any law statute or regulation in that regard the invalidity of such part shall in no way affect the validity of any other part of this Agreement and each and every part shall be severable from each and every other.
23.2 The waiver, expressed or implied by way of the parties hereto of any right hereunder or any failure to perform or any breach hereof by the other party hereto shall not constitute or be deemed as a waiver of any other right hereunder or of any other failure to perform or breach hereof by such other party whether of a similar or dissimilar nature thereto.
23.3 Save as provided in this Agreement none of the respective rights and obligations of the parties hereto shall be assignable except with the prior consent in writing of the other party. This Agreement shall enure to the benefit of and be binding upon the successors and permitted assigns of the parties hereto.
23.4 The Parties hereto shall bear their own Solicitor’s costs and expenses incurred in connection with and incidental to the preparation of this Agreement.
23.5 This Agreement supercedes all written Memoranda and Agreements and any representations or understandings written or otherwise between the parties hereto.
IN WITNESS WHEREOF_ the parties hereto have hereunto set their hands on this day and year first abovementioned.
The Common Seal of )
)
is affixed hereunto )
in the presence of:- )
……………………… ……………………..
Director Director/Secretary
Signed by )
practicing under the )
name and style of ….. )
in the presence of:- )
