When it comes to construction contracts in Malaysia, there are several types that are commonly used in the industry. Each type of contract has its own unique terms and conditions, and it is important for contractors and clients alike to understand the differences between them before entering into any agreements.

Here are the most common types of construction contracts in Malaysia:

1. Lump Sum Contract – This type of contract is also known as a fixed-price contract. Under this agreement, the contractor provides a predetermined price for the project, and is responsible for completing the work within that price. Any additional costs are borne by the contractor, while any savings are passed on to the client.

2. Cost-plus Contract – In this type of contract, the contractor is paid for the actual costs incurred during the project, plus an additional fee for profit. This type of contract is commonly used for projects where the scope of work or specifications are unclear, and the client wants to avoid unexpected expenses.

3. Unit Price Contract – Under this type of contract, the contractor is paid based on a pre-determined unit price for each item or task completed. This type of contract is particularly useful for projects where the final quantity of work is uncertain, or where there are multiple items of work with varying specifications.

4. Design-build Contract – In a design-build contract, the contractor is responsible for both the design and construction of the project. This type of contract offers advantages in terms of reduced risk and greater control for the client, as well as cost savings and streamlined communication for the contractor.

5. Turnkey Contract – This type of contract is similar to the design-build contract, but with a greater emphasis on the contractor taking full responsibility for the project. With a turnkey contract, the contractor designs, constructs, and hands over a completed project to the client, who only needs to “turn the key” to start using it.

In conclusion, choosing the right type of construction contract in Malaysia is an important decision that can have a significant impact on the success of your project. With an understanding of the different types of contracts available, you can make an informed decision that meets your specific needs and requirements. Whether you choose a lump sum, cost-plus, unit price, design-build, or turnkey contract, make sure to work closely with your contractor and seek professional advice to ensure that your agreement is fair, reasonable, and legally binding.