An analysis of key factor contributing to subcontractor disputes in the Malaysian construction industry
List of Authors
  • Ezlina Mohd Ahnuar, Muhammad Hazmin Hakimi

Keyword
  • Subcontractor, Subcontractor Related Cases, Subcontractor Dispute

Abstract
  • The Malaysian construction industry is pivotal in the country's economic development, contributing significantly to its GDP and employment. However, the industry is plagued by complex contractual relationships involving subcontractors. This research analyzes court cases related to subcontractor disputes in the Malaysian construction industry from 2014 to 2024, using a qualitative, descriptive approach and doctrinal method. The study examined 30 randomly selected cases to identify key factors contributing to subcontractor-related conflicts. The findings revealed that payment issues were the most prevalent cause of disputes, accounting for 18 out of 30 cases. This was followed by challenges to the Construction Industry Payment and Adjudication Act (CIPAA) in 10 cases. Other significant factors included contractual problems, work delays, quality and workmanship issues, disagreements over contract terms, change orders, and construction defects. The analysis highlights the complex nature of subcontractor relationships in the construction industry, emphasizing the need for clearer contractual frameworks, improved communication, and more efficient payment processes. The study also notes the ongoing debates surrounding the implementation and interpretation of CIPAA in subcontracting arrangements. To address these challenges, the research recommends that construction companies engage clients early, clearly define project scopes, and use plain language in contracts to foster transparency and collaboration. These measures are expected to lead to more successful project outcomes and reduce the frequency and severity of subcontractor-related disputes in the Malaysian construction industry.

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