Pp2 group assignment

SCHOOL OF ARCHITECTURE, BUILDING & DESIGN
BACHELOR OF QUANTITY SURVEYING (HONS)
PROFESSIONAL PRACTICE II (QSB60904)
COURSEWORK NO. 2
NO. NAME STUDENT ID
1 CHIN QI YU 0324094
2 GOH JIA JUN 0323302
3 LEE FONG YEN 0321976
4 LOH WEN JUN 0323551
5 RANEE LEOW KAI YEN 0328173
6 TEO CHUN CHEN 0327024
7 YIP XIAO JUNG 0323852

The summary of the Contract Sum is as follows:
Bill No. 1 – Preliminaries RM 4,250,000.00
Bill No. 2 – Building Works RM 62,850,000.00
Bill No. 3 – Local Infrastructure Works RM 4,500,000.00
Bill No. 4 – P.C. and Provisional Sums RM 9,600,000.00
Contract Sum RM 81,200,000.00
Question 1.
The Letter of Award for the above works was issued for RM 81,200,000.00 based on the tender sum
submitted by the Contractor. As you were preparing the contract documents for binding and
signature, you found some errors in the rates for aluminium windows works submitted by the
Contractor, which were very low. Kindly advise the actions that you will take.
In this situation, Letter of Award has been issued and Quantity Surveyor found out the rate for
aluminum window submitted by Contractor was very low before the contract has been signed. In the
case of Adams v. Lindsell (1818) 1 B & Ald 681, the court said that acceptance became effective at the
time of posting. In the situation of the question, LoA which is an acceptance of the offer or bid has
issued which means Employer and Tenderer have started entering into a contract. Hence the error in
pricing for the wrong rate for the window is a mistake found in the contract.
The Letter of Award should include such essential terms as below:
(i) Parties that are involved in the contract have to clearly specified.
(ii) The project title and a brief description of the scope of works which form the subject of the
contract.
(iii) Contract Sum
(iv) The date when site possession shall be given
(v) The date of commencement of works
(vi) The period for the completion of the works
The Letter of Award is not prepared in a final summary format which is same as in the Contract
Document or Tender Document. It doesn’t include the sum of each bill on the bill of quantity, which is
preliminaries, building works, local infrastructure works, and P.C. & provisional sums in this situation.

If the sum of each bill has stated in the Letter of Award, then the sum of each bill stated may not be
subject for adjustment.
As a Quantity Surveyor, the first thing to do is to check is there any discrepancy between the
description of the bill of quantity and contract drawings. If the description of bill of quantities was
prepared by the Quantity Surveyor was wrong, then Quantity Surveyor will require to inform the
Architect to issue an Architect Instruction (AI) to order for the first Variation according to Clause 11.6
(b) & (c) after the contract has been signed by both parties or after the commencement date stated in
the appendix. This situation is allowed due to the Clause 12.2, which states that where there are errors
in description, quantity or omission of items, the Contract is not vitiated but shall be corrected by the
Architect or Consultant.
If there is no discrepancy between drawings and description of bill of quantity, then Quantity
Surveyor will need to communicate with the Contractor for further information such as confirming with
the unit rates of the window, the specification of the window, or identify the unit rates had included the
work which incorporates with the installation of windows.
In the situation when Contractor has replied that the unit rate provided was correct, then
Quantity Surveyor may request from the supplier for the window supplier’s detail, contact number and
rates for the future confirmation; In the situation Contractor has replied that the unit rate provided was
incorrect, then Quantity Surveyor will undertake to review and rationalize the window rates to a
reasonable price whereas the contract sum can’t be adjusted in anyway according to PAM 2006 clause
13.1.
Rationalization of price also known as rates rationalization is usually performed after tendering
and during contract formation stage by Quantity Surveyor, who reviews and determines whether the
itemized prices and rates for the works stated by a selected Tenderer or Contractor in the Tender
Document or Contract Document are reasonable, consist of error or within the fair market price. In most
construction contracts, prices and rates quoted may not be adjusted, after the contract is formed.
However, PAM 2006 clause 12.2 allows any arithmetical errors or error in the prices and rates shall be
rationalized by Architect or Quantity Surveyor without changing the Contract Sum before the Contract
is signed by Employer and Contractor.
Rates rationalization is used for eliminating front loading in the Contractor’s prices and also
having a fair market price for variation. Normally, the Contractor may price some item in his tender
with an incorrect unit rate which may have been priced either too high or too low. If the error is not
identified during the tender stage and the Contractor’s tender price will directly include in the contract

along with the error and it will cause the Contractor will either suffer the loss or derive a benefit. Besides,
some Contractor priced lower rate in items they believe the actual quantity is less than quantity stated
in BQ and priced higher rate in items they believe the actual quantity is more than quantity stated in
BQ. Quantity Surveyor is required to rationalise and adjust the rates when necessary as the court held
in the case Sist Construction v State Electricity Commision of Victoria [1982] VR 597 of 606.
Quantity Surveyor can increase the rate of the window and decrease the rate of other items. It
is not advised to adjust the rate of the major item such as concrete, reinforcement bar. Based on the case
law, Dudley Corporation v Parsons and Morrin Ltd (1959) Plaintiff argue where the contract fixes the
rate at too low that the low rate only applies to the quantity of work included in the contract and that
any excess quantity due to variation should be priced at a fair rate. However, the court said that all
quantity should be paid at the bill rates written in the contract even it was under-priced. Quantity
Surveyor shall commit to maintaining professional and ethical standards without seeking to take
advantage of the Contractor.
Therefore, rate rationalization is the best option for Quantity Surveyor to maximize the benefit
for Contractor and Employer by adjusting the rate of the window without change the contract sum.

Question 2.
In accordance with clause 30.10 of the contract, the contractor duly submitted his Final Accounts
within 6 months after the issuance of the Certificate of Practical Completion. You are then required
to assess this application and prepare the Final Account for the apartment project based of the
following valuations and adjustments made to the Contract Sum:
Information provided are as follows:
a. The Architect had granted the Contractor’s first application for extension of time and approved
additional insurance premium amounting to RM 30,000.00 in accordance with clause 24 of the
contract due to the delay in the completion of the works caused by the Employer’s late decision on
the toilet design.
In his second application for extension of time, the Contractor submitted an an application for
extension of time due to exceptionally inclement weather and a loss and expense claim for
RM120,000.00 in his Final Accounts to you. The Architect approved the extension of time as per
Clause 23.8.
In the first situation, the Contractor’s application for extension of time was being granted and
additional insurance premium amounting RM30,000.00 was being approved. This is mainly due to the
Employer’s late decision on the toilet design. Hence this is a delay caused by Employer. Under clause
23.8(e), contractor is allowed to claim for extension of time if there is a delay in the issuance of AI for
which he has specifically applied in writing to the Architect. The late decision of the Employer has
delayed the issuance of AI by the Architect. As a result, the Contractor is not able to carry out the work
on time as planned earlier according to the master programme. Therefore, the Contractor is entitled for
extension of time (Clause 23.0) and also will be granted loss & expenses (Clause 24.0).
In the 2nd situation, the Contractor applied for extension of time due to exceptionally inclement
weather and a loss and expense claim for RM 120,000.00. The Architect has approved the extension of
time as per Clause 23.8. However, the loss and expense claim will not be granted. Exceptionally
inclement weather is a delay caused by Neutral Events according to Clause 23.8(b). It is an unexpected
occurrence. The Contractor will be granted for extension of time as long as it is supported with
necessary documents like getting the methodological rainfall record.

b. The following are the nominated sub-contractor’s accounts:
Original P.C. & Provisional Sums NSC’s Final Account
i. Lift Services:
Profit @ 2%
Attendance as item
RM 1,300,000.00
RM 26,000.00
RM 20,000.00
RM 1,600,000.00
ii. Air Conditioning Services:
Profit @ 2%
Attendance as item
RM 2,300,000.00
RM 46,000.00
RM 40,000.00
RM 2,200,000.00
iii. Electrical Services:
Profit @ 2%
Attendance as item
RM 2,700,000.00
RM 54,000.00
RM 50,000.00
RM 2,600,000.00
iv. Provisional Sums: Guard House RM 1,000,000.00 RM 1,250,000.00
v. Contingency Sum RM 2,064,000.00
RM 9,600,000.00
According to Clause 30.10, The Final Account of a construction project shall be completed
within six (6) months from the receipt of all documents from the Contractor. Such documents include
the latest construction drawings, details of all quantities, rates and prices and any adjustment of the
Contract Sum. The Final Account shall include the omission of all P.C Sums and Provisional Sums and
adding-back to the NSC’s and NS’s final account together with the adjustment of profit and attendance
( Clause 30.11(c) ). P.C. Sums are allowed during tender stage for specialist work like M&E works and
lift installations. The amount is not fixed as the NSC is still yet to be chosen. Therefore, omission and
adding-back of P.C. Sums will be necessary during final account. Whereas, Provisional Sum is an
estimated allowance for elements that cannot be measured at the time of tender due to insufficient
information and drawings. This sum is decided by QS and is important to capture this amount at tender
stage for budgetary purpose. Re-measurement of such allowance will be required once received
sufficient information and drawings. Hence, the re-measured amount will be added back to the NSC’s
final account. Nevertheless, The Final Account shall allow adjustments of Provisional Sum based on
actual expenditure and omitted if not expended as per Clause 30.11(d).

In this project, the original P.C and Provisional Sums of RM 7,536,000.00 including all profit
and attendance that is allowed in the original Contract Sum will be omitted as this is an estimated sum
allowed by the QS at tender stage. The Contingency Sum of RM 2,064,000.00 that is allowed for
unforeseen circumstances during the construction process will also be omitted from the Final Account.
In conclusion, a total amount of RM 9,600,000.00 will be omitted from the Final Account as referred
to Clause 30.11(c). This is followed by adding-back of NSC’s and NS’s final accounts. After the
completion of the project, the work done by NSC and NS will now be able to be quantified. The QS
will now allow P.C. Sums for lift services, air-conditioning services, and electrical services with a total
of RM 6,638,000.00 including 2% of profit and attendance to the NSC’s final account. As for the
Provisional Sum, a sum of RM 1,300,000.00 is allowed for guard house which also includes 2% of
profit and attendance. To sum this up, an amount of RM 7,938,000.00 is added back to the Final
Account after adjustment of profit and attendance ( Clause 30.11(d) ).

Project : Construction of An Apartment Project
Employer : Taylors Sdn Bhd
Contractor: Veli Good Construction Sdn Bhd
1.0 Original Contract Sum
2.0 Less : P.C. & Provisional Sums
Total Builder's Works
3.0 Add : Variation Works (V.O. Nos 1 - 4)
Total Additions
Total Omissions
Nett Additions
4.0 Add back : NSCs' Final Account
4.1 Lift Services
4.2 Air Conditioning Services
4.3 Electrical Services
4.4 Guard House
4.5 Profit and Attendance
`
(a) Profit @ 2% of RM 7,650,000.00
(b) Attendance
5.0 Contractual Claims
5.1 Additional Expenses
FINAL CONTRACT VALUE
Payments made by Employer on behalf of the Contractor
Contractor's All Risk Insurance
30,000.00
135,000.00
30,000.00 30,000.00
79,550,500.00
153,000.00
288,000.00 288,000.00
2,200,000.00
2,600,000.00
1,250,000.00
(50,500.00)
(17,500.00)
71,582,500.00
1,600,000.00
RM180,000.00
FINAL ACCOUNT
RM RM
81,200,000.00
(9,600,000.00)
7,650,000.00 7,650,000.00
(17,500.00)
33,000.00
71,600,000.00

Contractor : Veli Good Construction Sdn Bhd
Summary of Original Contract Sum
Item Description Amount (RM)
1 Preliminaries 4,250,000.00
2 Building Works 62,850,000.00
3 Local Infrastructure Works 4,500,000.00
4 P.C and Provisional Sums 9,600,000.00
TOTAL CARRIED TO STATEMENT OF FINAL ACCOUNT 81,200,000.00

Summary of Loss and Expense
Item Description
Clause
Reference -
PAM 2006
(With
Quantities)
Amount
Claimed
(RM)
Granting of
Loss and
Expense
Amount
Granted
(RM)
Remarks
1
Additional
Insurance
Premium
24.3(a) 30,000.00 Approved 30,000.00
It falls under the relevant
event under Clause 24.3(a)
whereby the late issuance of
Architect's Instructions by
The Architect due to
Employer's late decision on
toilet design has materially
affected the progress of
works.
2
Claim under
exceptionally
inclement weather
- 120,000.00 Not Approved -
It does not fall under the
relevant event under Clause
24.3, whereby exceptionally
inclement weather is a neutral
event, where both parties are
not at fault and hence, will
have to bear their own losses
in accordance to nature of
justice.
TOTAL CARRIED TO STATEMENT OF FINAL ACCOUNT 30,000.00
Architect confirmed fair and
reasonable granting of
amount claimed

Certificate of Extension of Time
Item Cause of Delay
Clause Reference -
PAM 2006 (With
Quantities)
Granting of
Extension of
Time
Days
Granted
Remarks
1
Employer's late
decision on the
toilet design
23.8(e) Approved X
event under Clause 23.8(e)
whereby the late issuance of
Architect's Instructions by
The Architect due to
Employer's late decision on
toilet design has materially
affected the progress of
works. Therefore,
Contractor's application for
Extension of Time is granted.
2
Adverse weather
conditions
23.8(b) Approved Y
event under Clause 23.8(b)
whereby the delay is caused
by adverse weather
conditions. Hence, Contractor
is entitled for Extension of
Time.
TOTAL DAYS GRANTED FOR APPLICATION OF EXTENSION
OF TIME
X+Y
Architect confirmed fair and
reasonable granting of
Extension of Time

Summary of NSCs' Final Account
Item Description
Original Sum
(RM)
NSC's Final
Account (RM)
Total Profit
(RM)
Total Attendance
(RM)
NSC/1 Lift Services 1,300,000.00 1,600,000.00
Profit @ 2% 26,000.00 32,000.00
Attendance as an item 20,000.00 20,000.00
NSC/2 Air Conditioning Services 2,300,000.00 2,200,000.00
Profit @ 2% 46,000.00 44,000.00
NSC/3 Electrical Services 2,700,000.00 2,600,000.00
Profit @ 2% 54,000.00 52,000.00
NSC/4 Provisional: Guard House 1,000,000.00 1,250,000.00
Profit @ 2% 25,000.00
Attendance as an item 25,000.00
(Allow 2%)
Total NSC Final Account 7,650,000.00
Total Profit 153,000.00
Total Attendance 135,000.00
7,536,000.00 7,650,000.00 153,000.00
TOTAL CARRIED TO STATEMENT
OF FINAL ACCOUNT
135,000.00

Summary of Variation Orders
Item Description
Omission
(RM)
Addition
(RM)
Nett Addition/
Omission
(RM)
Remarks
VO1
Failure to purchase
Insurance by Contractor
prior to commencement of
work, Employer purchased
on behalf
0.00 0.00 0.00
Invalid Variation
submitted, no amount to
be included in Final
Account
VO2
Issuance of AI to purchase
colour photcopier machine
instead of black and white
one
0.00 8,000.00 8,000.00
Amount to be included in
Final Account for
payment as addition
VO3
Change in types of Floor
Finishes in lift lobbies from
Marble to Granite Flooring
(50,000.00) 20,000.00 (30,000.00)
Final Account for
payment as addition
VO4
Change of quantity in
excavation through rocks
with revised rates
(500.00) 5,000.00 4,500.00
Final Account as addition
Valuation carried out by
Architect is fair and
reasonable. Amount
confirmed by Architect,
to be included in Final
Account
TOTAL CARRIED TO STATEMENT
OF FINAL ACCOUNT
(50,500.00) 33,000.00 (17,500.00)

c. You have to evaluate the following variations for final account:
i. The Contractor had priced RM 130,000.00 for the Contractor All Risk Insurance policy in the
Preliminaries Bills. The Contractor failed to purchase this insurance when the works commence.
The Employer, then, bought and paid for the said insurance for RM 180,000.00 on behalf of the
Contractor, for which the Contractor agreed. The Employer wants to recover this cost.
In the matter above, the original sum priced in the Preliminaries Bills at RM 130,000.00 has
not been paid by the Contractor. This is a default in insuring by the Contractor. However, there is also
an increase in the insurance premium, amounting to the final sum of RM 180,000.00. This is not a
variation, as it does not fall into the categories stated in Clause 11.6, and is not considered as Works
executed in the contract. Therefore, the Final Account shall only reflect the original sum, which is RM
130,000.00.
What can be done is as follows. The total sum, which is RM180,000.00 shall be recovered by
set-off (Clause 30.4 & Clause 20.A.3). Where the Contractor fails to insure or continue to insure works
for the new building under Contractor All Risk policy, Employer may insure against the risk and any
cost incurred or paid by the Employer shall be set-off against the Contractor. The additional amount
set-off shall not be reflected in the Final Account. (Clause 30.11(f)).
Clause 30.11(f) states that it shall not be included in the Final Account, and are matters to be
resolved separately between the Employer and Contractor. “Almost all the local standard forms of
conditions of contract have express clauses covering such an eventuality;”, according to Ir Harbans
Singh’s (2014, p. 145) Commencement and Administration. The Employer shall be entitled to set-off
all cost incurred, and it can be recovered from the Contractor as a debt, or from any monies due (Interim
Certificate) and/or from the Performance Bond. The Contractor has also agreed for the payment to be
made by the Employer on behalf of the Contractor.
In conclusion, the increase in price for the Contractor All Risk would not be reflected as a
variation, and would only show as RM130,000.00 in the Final Account. The total sum of RM180,000.00
would be set-off by the employer as a means to recover to sums. The Final Account shall also reflect
the total RM180,000.00 as payments made by the Employer on behalf of the Contractor. Therefore, the
variation is invalid.

ii. Under the Preliminaries, the Contractor is required to provide a black and white photocopier
machine on site for the Resident Engineer’s use but this item was left un-priced, i.e. BQ item was
left blank in the rate/amount column in the contract document. During the progress, the Architect
instructed the Contractor to provide a colour photocopier machine costing RM8,000.00 instead
of the black and white one as specified. Contractor submitted a variation claim for RM8,000.00.
In the case when an item is left unpriced in the Preliminary section in the contract document, it
shall be deemed that the contractor has included the expenses of that item elsewhere. Hence, the
employer has the right to omit out the item of the photocopier machine as per Architect’s Instruction
(AI). According to PAM Contract 2006 (With Quantities) Clause 11.6 (e), omission of BQ items is
allowed and the rates in the Contract Documents shall determine the valuation of items omitted.
Since the black and white photocopier machine are left unpriced in the Preliminary section in
the contract document upon the agreement of contract. Thus, this situation can be referred to Clause
11.6 (c) states that where work is not of a similar character to work out in the contract documents, the
valuation shall be at fair market rates and prices are to be determined by the Quantity Surveyor.
Supported by the case law of Crittal Windows LTD v TJ Evers Ltd (1996) 54 Con LR 66. Meaning to
say that the item of the black and white photocopier machines that should be provided by the Contractor
shall be omitted and the cost of the photocopier machine shall be determined by the Quantity Surveyor
with the fair market price and agreed rates by both the Employer and the Contractor, whereas the term
‘market price’ of a commodity was to be construed with the reference of surrounding circumstances,
which could be sought from Charrington & Co Ltd v Wooder (1914) AC 71.
As for this black and white photocopier machine item, which is not priced in Preliminary
Section and omitted by the Architect, will be an additional item as a variation as defined in Clause 11.1
(a). The price of this particular item shall be determined by fair market rates and prices determined by
the Quantity Surveyor in accordance to Clause 11.6 (c).
However, since the black and white photocopier machine has omitted by the Architect, meaning
to say the Employer no longer require the Contractor to provide such photocopier machine, Thus, there
will be no additional Variation Works. In the other hand, if the Architect has instructed the Contractor
to provide a colour photocopier machine is has cost RM8,000.00 instead of the black and white one as
specified, Clause 11.7 stated that where a variation has caused or is likely to cause the Contractor to
incur additional expenses for which he would not be paid under any provision in Clause 11.6, the
Contractor may make a claim for such additional expenses provided always by fulfilling Clause 11.7

(a), (b). Taking in mind that for the contractor to claims such variations, the contractor should avoid
raising his intention to claim in site meetings by recording into minutes of meetings. Such notice is
debatable (refer case law: John L Harley Ltd v Du(m)fries & Galloway Regional Council (1988)), hence
the contractors should not resort to statements in site meetings but give proper notices in writing.

iii. The Contractor had delivered to site all marble floor tiles needed for the lift lobbies as
specified in the contract and construction drawings. However the Architect decided to use
granite floor instead and instructed the Contractor to remove all the marble tiles from site.
The Contractor paid RM 50,000.00 for the marble tiles. The Contractor returned the marble
tiles to the supplier but only managed a refund of RM 30,000.00. The Contractor submitted
a claim for the loss of RM 20,000.00 that he suffered.
In this scenario, the floor finishes for lift lobbies has been changed from marble floor tiles to
granite floor. According to PAM Contract 2006, this Variation Order can be defined under Clause
11.1(b) which says the alteration of the kind or standard of any materials and goods to be used in the
works.
Originally, the contract and construction drawings has specified that marble floor tiles will be
used for the lift lobbies, however the architect decided to use granite floor instead. This variation can
be evaluated under the clause 11.6(c), where work is not of a similar character to work as set out in the
Contract Documents, the valuation shall be at fair market rates and prices determined by the Quantity
Surveyor. According to case law, Crittal Windows Ltd v TJ Evers Ltd (1996), the court says a detail
build-up of the varied work with rates and prices must be provided so that the fair rates and prices for
each cost element can be established. This decision is basically saying that the Contractor should be
given a fair valuation which pay the Contractor the actual cost that he is incurred and the similar
allowance for profit and overhead for the work should be included as well. With the support of this
relevant clause and case law, this variation is considered as a valid VO and the variation work must be
priced at a fair market price.
According to clause 11.7, where a variation has caused or is likely to cause the contractor to
incur additional expenses, the contractor may make a claim for such additional expenses provided that
the contractor submit a written notice to architect of his intention to claim for such additional expenses
within 28 days from the date of AI. Giving of such notice shall be condition precedent to entitlement to
claim for additional expenses. With the giving of such notice, contractor is entitled to claim for the loss
that he suffered.
In this case, the contractor has paid RM 50,000.00 for the purchases of marble floor tiles
required for lift lobbies, however the architect decided issue an AI for a variation order to use granite
floor instead. The contractor then returned the marble tiles to the supplier but only managed to get a
refund of RM 30,000.00 and suffered a loss of RM20,000.00. According to clause 11.8, the contractor

shall keep contemporaneous records to substantiate all his claim for additional expenses under clause
11.7, and shall submit all particulars to the Architect and Quantity Surveyor to assess.
Clause 11.9 says that as soon Architect has ascertained the amount of Variation and or
additional expenses claimed by the Contractor under clause 11.7, the amount ascertained shall added to
the Contract Sum. In addition, clause 30.11(a) states that the adjustment made to the contract sum shall
be included in Final Account.
In conclusion, I would recommend that this variation is valid and the RM 20,000.00 loss that
contractor suffered from the Variation Order should be included in the final account.

iv. Mistake was made in the price for excavation through rocks at RM 50 per m3. Item was not
rationalised during contract documentation. However, original quantity in BQ is 10 m3 but
re-measured as-built quantity was 100 m3. The Contractor submitted a claim for RM 55,000
based on a revised rates of RM 550 per m3 for the total quantity of 100 m3.
According to PAM Contract 2006, Clause 11.6 defines the rules of valuation which are applied
under different situations for Variations. These rules are mandatory to be used for Variations that fulfill
the terms of Variation under Clause 11.1, which defines variation as the alteration or modification of
the design, quality or quantity of the Works. In this case, the additional quantity of 90 m3 in BQ for
excavation for rocks can be considered as a variation under Clause 11.1(a).
The excavation for rocks which the original quantity in the BQ is 10 m3, but when the
excavation for rocks is re-measured based on as-built quantity was 100 m3. Based on Clause 11.6 (a)
of the valuation rules where work is of similar character executed under similar conditions and no
significant change in the quantity of work. In this case, whether the variation of excavation for rocks
which is of similar character is to be determined by using the contract rates and price in the contract
BQ.
However, according to Clause 13.1 states that any errors in the prices and rates shall be
corrected or rationalized by the Architect or Consultant before the signing of the Contract. Since the
rates of the excavation for rocks was not rationalized during the contract. Therefore, even through there
was errors made in the price of excavation for rocks at RM 50 per m3. The revised rate submitted by
the contractor should not be used as errors are not allowed to be revised after signing of the Contract.
According to “Henry Boot Construction Ltd v Alstom Combined Cycles (2002)” the English
Court of Appeal held that the rates and prices in the contract should be given full effect notwithstanding
that the contractor has made a mistake in his tender. However, the rate may be adjusted if they are used
for variations where works are not executed under similar conditions or there is a significant change in
the quantities. Based on Clause 11.6 (b) of the valuation rules states where work is of similar character
but is not executed under similar conditions or is of similar character but there is a significant change
in the quantity of work carried out, the rates and prices shall include a fair adjustment in the rates.

For this case, the rates of the excavation for rocks for the original quantity of 10 m3 should be
price based on the contract BQ at RM 50 per m3. The QS will then decide whether the revised rate of
RM 550 per m3 is reasonable under the circumstances by referring to the nature of the original and
varied work and adjust the contract rates by making reasonable allowance for the differences involved.
Hence, the rate for the additional quantity of 90 m3 can be adjusted based on fair valuation or based on
contractor’s revised rate if reasonable.
According to Clause 11.7 the contractor is entitled to make claim for the additional expenses
caused by the variation works due to the additional quantity of 90 m3 of excavation for rocks which
may result in the additional labours and machineries work force required for the variation of the works.
The recommended revised amount of claim to the contractor is RM 5,000 based on the rate of
RM 50 per m3 and quantity of 100 m3.

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