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A Qualitative Study On the Doctrine of Privity to Circumvent Its Effect On Subcontractor’s Payment Claim

In common law jurisdictions, the doctrine of privity has been criticised by the judiciary and academic commentators, particularly the second rule of doctrine, which states that a person who is not a party to the contract cannot sue on it to obtain promised performance, although the contract has been...

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Main Authors: Yan, See Zhi, Mohd Suhaimi, Mohd-Danuri, Noorfajri, Ismail, Othman, Mohamed, Fadzida, Ismail
Format: Article
Language:English
Published: Malaysian Institute Of Planners 2023
Subjects:
HD28 Management. Industrial Management
TH Building construction
Online Access:http://umpir.ump.edu.my/id/eprint/39279/1/A%20Qualitative%20Study%20On%20the%20Doctrine%20of%20Privity%20to%20Circumvent%20Its%20Effect%20On%20Subcontractor%E2%80%99s%20Payment%20Claim.pdf
http://umpir.ump.edu.my/id/eprint/39279/
https://doi.org/10.21837/pm.v21i29.1353
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spelling my.ump.umpir.392792023-11-14T00:37:43Z http://umpir.ump.edu.my/id/eprint/39279/ A Qualitative Study On the Doctrine of Privity to Circumvent Its Effect On Subcontractor’s Payment Claim Yan, See Zhi Mohd Suhaimi, Mohd-Danuri Noorfajri, Ismail Othman, Mohamed Fadzida, Ismail HD28 Management. Industrial Management TH Building construction In common law jurisdictions, the doctrine of privity has been criticised by the judiciary and academic commentators, particularly the second rule of doctrine, which states that a person who is not a party to the contract cannot sue on it to obtain promised performance, although the contract has been formed with the intention to benefit him. In certain circumstances, this rule may produce unfair and injustice result to the third party of a contract, as it prohibits the third party from enforcing the right to get benefits conferred on them. The doctrine of privity becomes relevant in the context of tendering procedures when subcontractors, who are not direct parties to the main construction contract, are involved. Hence, the aim of this paper is two-fold: to highlight the difficulties of the existing legal mechanism associated with privity rule and to suggest possible ways to circumvent the effect of the doctrine of privity on subcontractors’ payment claims in the Malaysian construction industry. By adopting the socio legal research approach, the impact of the doctrine of privity, the difficulties of the existing legal mechanisms, and the need for a possible law reform were examined. The findings were also validated by conducting semi-structured interviews with five construction law experts. Among others, the findings showed that enhancement to the existing legal mechanisms and statutory intervention can effectively circumvent the privity rule and protect the subcontractor’s right for the payment claim. Malaysian Institute Of Planners 2023 Article PeerReviewed pdf en cc_by http://umpir.ump.edu.my/id/eprint/39279/1/A%20Qualitative%20Study%20On%20the%20Doctrine%20of%20Privity%20to%20Circumvent%20Its%20Effect%20On%20Subcontractor%E2%80%99s%20Payment%20Claim.pdf Yan, See Zhi and Mohd Suhaimi, Mohd-Danuri and Noorfajri, Ismail and Othman, Mohamed and Fadzida, Ismail (2023) A Qualitative Study On the Doctrine of Privity to Circumvent Its Effect On Subcontractor’s Payment Claim. Planning Malaysia: Journal of the Malaysian Institute of Planners, 21 (5). pp. 17-31. ISSN 0128-0945. (Published) https://doi.org/10.21837/pm.v21i29.1353 10.21837/pm.v21i29.1353
institution Universiti Malaysia Pahang Al-Sultan Abdullah
building UMPSA Library
collection Institutional Repository
continent Asia
country Malaysia
content_provider Universiti Malaysia Pahang Al-Sultan Abdullah
content_source UMPSA Institutional Repository
url_provider http://umpir.ump.edu.my/
language English
topic HD28 Management. Industrial Management
TH Building construction
spellingShingle HD28 Management. Industrial Management
TH Building construction
Yan, See Zhi
Mohd Suhaimi, Mohd-Danuri
Noorfajri, Ismail
Othman, Mohamed
Fadzida, Ismail
A Qualitative Study On the Doctrine of Privity to Circumvent Its Effect On Subcontractor’s Payment Claim
description In common law jurisdictions, the doctrine of privity has been criticised by the judiciary and academic commentators, particularly the second rule of doctrine, which states that a person who is not a party to the contract cannot sue on it to obtain promised performance, although the contract has been formed with the intention to benefit him. In certain circumstances, this rule may produce unfair and injustice result to the third party of a contract, as it prohibits the third party from enforcing the right to get benefits conferred on them. The doctrine of privity becomes relevant in the context of tendering procedures when subcontractors, who are not direct parties to the main construction contract, are involved. Hence, the aim of this paper is two-fold: to highlight the difficulties of the existing legal mechanism associated with privity rule and to suggest possible ways to circumvent the effect of the doctrine of privity on subcontractors’ payment claims in the Malaysian construction industry. By adopting the socio legal research approach, the impact of the doctrine of privity, the difficulties of the existing legal mechanisms, and the need for a possible law reform were examined. The findings were also validated by conducting semi-structured interviews with five construction law experts. Among others, the findings showed that enhancement to the existing legal mechanisms and statutory intervention can effectively circumvent the privity rule and protect the subcontractor’s right for the payment claim.
format Article
author Yan, See Zhi
Mohd Suhaimi, Mohd-Danuri
Noorfajri, Ismail
Othman, Mohamed
Fadzida, Ismail
author_facet Yan, See Zhi
Mohd Suhaimi, Mohd-Danuri
Noorfajri, Ismail
Othman, Mohamed
Fadzida, Ismail
author_sort Yan, See Zhi
title A Qualitative Study On the Doctrine of Privity to Circumvent Its Effect On Subcontractor’s Payment Claim
title_short A Qualitative Study On the Doctrine of Privity to Circumvent Its Effect On Subcontractor’s Payment Claim
title_full A Qualitative Study On the Doctrine of Privity to Circumvent Its Effect On Subcontractor’s Payment Claim
title_fullStr A Qualitative Study On the Doctrine of Privity to Circumvent Its Effect On Subcontractor’s Payment Claim
title_full_unstemmed A Qualitative Study On the Doctrine of Privity to Circumvent Its Effect On Subcontractor’s Payment Claim
title_sort qualitative study on the doctrine of privity to circumvent its effect on subcontractor’s payment claim
publisher Malaysian Institute Of Planners
publishDate 2023
url http://umpir.ump.edu.my/id/eprint/39279/1/A%20Qualitative%20Study%20On%20the%20Doctrine%20of%20Privity%20to%20Circumvent%20Its%20Effect%20On%20Subcontractor%E2%80%99s%20Payment%20Claim.pdf
http://umpir.ump.edu.my/id/eprint/39279/
https://doi.org/10.21837/pm.v21i29.1353
_version_ 1822923852240388096
score 13.235362

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