We previously wrote on “An Overview of Mediation under the Pusat Mediasi Covid-19”, linked here
On 8 March 2022,1
the Minister in the Prime Minister’s Department (Parliament and Law), Datuk Seri Wan Junaidi Tuanku Jaafar, announced the abolishment of the amount limit for construction sector disputes under the Covid-19 Mediation Centre (“PMC-19
”), previously capped at RM500,000.00.2
These construction sector disputes include disputes relating to “construction work contract or construction consultancy contract and any other contract related to the supply of construction material, equipment or workers in connection with a construction contract.” 3
However, the RM500,000.00 amount limit of disputes still applies for mediation of disputes arising from other categories of contract under the Temporary Measures for Reducing the Impact of Coronavirus Disease 2019 (Covid-19) Act 2020 (“Covid-19 Act
Henceforth, construction players may pursue mediation at PMC-19 for disputes of any amount under the construction sector category, in respect of any contracting party’s inability to perform any contractual obligation due to the measures prescribed, made or taken under the Prevention and Control of Infectious Diseases Act 1988 (“PCID Act
”) to control or prevent the spread of Covid-19.5
As the Covid-19 Act will cease to operate after 22 October 2022,6
construction players should expediently leverage on the abolition of the RM500,000.00 limit by the Government specifically for construction sector disputes, and pursue mediation as a first avenue to resolve disputes arising from a party’s inability to perform its contractual obligation under a construction contract as a result of measures prescribed or taken under the PCID Act to control or prevent the spread of Covid-19.
Alert by Shannon Rajan (Partner) and Jeremiah Ch’ng (Associate) of Skrine.
The quantum for all cases submitted for mediation at PMC-19 was initially set at RM300,000.00. The maximum amount was increased to RM500,000.00 on 30 December 2020 (Source: Reply by PMC-19 to enquiry on 18 March 2022.
Section 7 read with Schedule to Part II of the Covid-19 Act.
Under Section 7 read with Schedule to Part II of the Covid-19 Act, the other categories relate to performance bond, event contract, contact by a tourism enterprise, professional services contract, lease or tenancy of non-residential immovable property, religious pilgrimage-related contract, certain categories of hire purchase agreement, and credit sale agreement.
Section 9 of the Temporary Measures for Reducing the Impact of Coronavirus Disease 2019 (Covid-19) Act 2020 (“Covid-19 Act
See Temporary Measures for Reducing the Impact of Coronavirus Disease 2019 (Covid-19) (Extension of Operation) (No. 4) Order 2021 [PU(A) 485/2021].