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ASSIGNMENT 1

QUESTION
Smart Developer engages Clever Architect as the designer and contract
administrator of his office building project. He employs Strong Contractor to
carry out and complete the construction of the project. In the course of the
construction, Clever Architect charges Strong Contractor for all drawings and
plans supplied to the contractor for the purpose of the construction. Strong
Contractor concedes to the demand so as not to delay his progress and later
serves a protest notice to Smart Developer. Clever Architect contends that it is
a custom in construction industry that contractors should pay for all drawings
and plans supplied to them. Smart Developer is unhappy with Clever
Architects performance and serves a notice terminating his engagement after
thirty days from the date of the notice. However, Clever Architect argues that
the thirty day notice is not valid. He asserts that it is the custom in the
architectural services that the notice should be minimum sixty days. When
Strong Contractor completes the construction and is leaving the site, he
dismantles and removes the site office. Smart Developer objects the
contractors action and insists that the site office be reinstalled.
You are required to identify the issues in the above case and advise the three
parties accordingly.

ANSWER
INTRODUCTION
Architects are normally employed under standard conditions of agreement
which is being set by Architects Act 1967 (Act 117) 1 & Architects Rules 1996 2.
The conditions of engagement of an architect serve several purposes 3. The
conditions of engagement of an architect form the details of a contract
between two parties and conveniently use as there is no need to draft a
specific appointment agreement. It also provides an outline for establishing the
duties and scope of the professional. Thus it is a contract and subject to the
rules of law. The terms within them relate to the responsibilities and services of
the architects. The general conditions spell out payment clauses which govern
detailed information regarding the calculation and timing of payments
including refund of expenses and disbursements. According to A. Piven,
expenses made in the interest of the project sometimes referred to as out-of
pocket expenses4. It is identified separately from architects costs during the
delivery of the architects services including reproduction of drawings. The
agreement between Architect and the client may be terminated at any time by
either party giving to other party sixty days notice or shorter period as may be
agreed by both parties1. Upon termination, client is under obligation to pay
balance of fees for services rendered up to the stage of termination together
with all reimbursable charges1. After received payment due, Architect shall
issue a letter of release to the client and the client shall be entitled to appoint
another architect to continue with project1.
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1. Architects Act 1967 (Act 117)

2. Architects Rules 1996
3. Construction_Contracts_Law_and_Management-John_Murdoch_Taylor_&_Francis-2001
4. A. Piven, Peter, Compensation Management: A Guideline for Small Firms 1982, The American
Institute of Architects Financial Management System access via
http://www.aia.org/aiaucmp/groups/aia/documents/pdf/aiab087245.pdf

The definition of land in Section 5 National Land Code (NLC) includes; all things
attached to the earth or permanently fastened to anything attached to the
earth, whether on or below the surface 5. The legal principle applicable is
Quicquid plantatur solo, solo cedit "whatever is affixed to the soil belongs to
the soil. With something that is or becomes affixed to the land becomes part
of the land; therefore, title to the fixture is a part of and passes with title to the
land and therefore whoever owns that part of the land will also own the things
attached. The law of fixture is stated in Holland v. Houdgson case law with
Blackburn J. introduced the degree and object of annexation test 6:
Thus blocks of stone placed one on the top of another without any mortar or
cement for the purpose of forming a dry stone wall would become part of the
land, though the same stones, if deposited in a builder's yard and for
convenience sake stacked on the top of each other in the form of a wall, would
remain chattels. On the other hand, an article may be very firmly fixed to the
land, and yet the circumstances may be such as to show that it was never
intended to be part of the land, and then it does not become part of the land.
Degree of annexation test and purpose of annexation test is mean to decide
whether the article is a fixture or a chattel 7. The degree of annexation test is a
test on the physical attachment of the article by looking at the degree to which
an article is affixed to the land. The purpose of annexation test is a test to ask
reason and intention of the item attached to the land. Blackburn J. in Holland v.
Hodgson said that But even in such a case, if the intention is apparent to
make the articles part of the land, they do become part of the land. Case law
of Goh Chong Hin v. Consolidated Malay Rubber (1924) 5 FMSLR 86 has apply
the principle of English Law of Fixture 7. Sproule J. said that that English law of
fixtures is applicable and referred to in Malaysia.
THE ISSUES
Below is the list of a few issues that can be discussed from the facts given
above?
1. Whether Strong Contractor is liable to pay Clever Architect all the
drawings and plans supplied for the purpose of the construction? If not,
can Strong Contractor get the money back?
2. Smart Developer want to terminate Clever Architect and issue
terminating notice of thirty days, but Clever Architect contends the
custom practice is minimum sixty days. Whether thirty days of
termination notice is valid?
3. Smart Developer insists the site office be reinstalled. Does the site office
is considered as fixtures or chattel?

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5.
6.
7.

Section 5 NLC
Holland v. Hodgson (1872) L.R. 7 C. P. 328
Goh Chong Hin v. Consolidated Malay Rubber (1924) 5 FMSLR 86

THE DISCUSSION
Architects Act 1967(Act 117) Architects Rules 1996 were used in Issue One
and Issue Two, and Goh Chong Hin v. Consolidated Malay Rubber (1924) 5
FMSLR 86 were used in Issue Three as reference.
Issue One:
Whether Strong Contractor is liable to pay Clever Architect all the drawings
and plans supplied for the purpose of the construction? If not, can Strong
Contractor get the money back?
Referring to the Architects Act 1967 (Act 117), the contractor was not parties
to the contract between the architect and the client. The contract and
agreement of the architect is with the client. Therefore according to the case of
Fc Seck Trading As Oversea Structural Company v Wong and Lee [1940] 1 MLJ
182, the contractor has paid the architect due to the contractor ignorance of
their rights8. The court held that the architect has taken advantage of the
contractors ignorance and the learned District Judge decided that the case
cannot be put under the mistake of law if the contractor is ignorant of his right.
The case also suggested that there is no proof that could contradict with
written contract. The written contract between the architect and the client
clearly stated the payment, reimbursable expenses and additional services
compensation between the architect and the client. Therefore, in printing
reproducing all documents including drawings, the architect should instead
charge to the client as part of the additional expenses.
In this case, the contractor pay to the architect in order not to delay the work
progress and the contractor is fully aware of their right thus they issue a
protest notice to the client. Using the case of Fc Seck Trading As Oversea
Structural Company v Wong and Lee [1940] 1 MLJ 182, Strong Contractor are
not liable to pay Clever Architect for the reproduction of the drawings because
in Fc Seck Trading As Oversea Structural Company v Wong and Lee the
supplying of plans is part of the architects duties. However, Strong Contractor
is fully aware of his right not liable to pay Clever Architect. Terrell, AG CJ
quoted Mellish L.J. said in Rogers v Ingham:
"But on the other hand I think that, no doubt, as was said by Turner, L J.
'This Court has power (as I feel no doubt that it has) to relieve against
mistakes in law as well as against mistakes in fact' ( Stone v Godfrey De
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GM & G p 90) that is to say, if there is any equitable ground which

makes it, under the particular facts of the case, inequitable that the
party who received the money should retain it."
It is clear that Strong Contractor is not liable to pay Clever Architect for the
drawings, but Strong Contractor pay and did not contend even though they are
fully aware of their rights.

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Fc Seck Trading As Oversea Structural Company v Wong and Lee [1940] 1 MLJ 182

Issue Two
Smart Developer want to terminate Clever Architect and issue terminating
notice of thirty days, but Clever Architect contends the custom practice is
minimum sixty days. Whether the issuance thirty days of termination notice is
valid?
The conditions of engagement is the contract between an architect and his
client and also a custom and practice as sanctioned by the Malaysian Institute
of Architects and the Board of Architects. Lee Hun Hoe CJ (Borneo) said in CS
Khin Development Sdn Bhd v Chung Yoke Onn 9:
In Datin Peggy Taylor v Udachin Development Sdn Bhd [1984] 1 MLJ 85
the Court considered that the 'Pertubuhan Akitek Malaysia' (PAM)
guidelines should be imported because they reflected the custom or
practice of the profession of the architects and could be relied upon or
could be called in aid when the contingency of abandonment was not
provided for in any agreement. In such a situation the Court took the
view that it was right to take into account the prevailing practice of the
architectural fraternity in order to give business efficacy to the contract
of employment where the architect through no fault of his own had to
cease his professional duties.
The conditions provide termination of engagement item whereby termination
by either party can be done by the giving of a notice of 60 days or any shorter
period that may be agreed to between the parties 10.
Clause 17 (1), The Memorandum of Agreement between the
Professional Architect and the client may be terminated at any time by
either party serving upon the other party a written notice of termination,
where such termination shall take effect after a period of sixty days
from the date of the written notice, or such shorter period as may be
agreed upon between the Professional Architect and the Client
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The case law that has debate the issue of the above is Ac Ho Sdn Bhd v Ng
Kee Seng (T/A Konsultant Senicipta) 11. In the case of is Ac Ho Sdn Bhd v Ng Kee
Seng, the termination letter of Ng is dated on 27 December 1993 and it was
replied with the statement of our client accepts the repudiation on 7 January
1994. Therefore the termination is valid even though the period is shorter than
30 days as the termination is agreed by both parties.
Issue Three
Smart Developer insists the site office be reinstalled. Does the site office is
considered as fixtures or chattel?
Under the English law of fixtures, two tests derived in Holland v. Houdgson is
important to justify the site office as a fixture or chattel. Degree of Annexation
test includes objects either attached
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9.
10.
11.

CS Khin Development Sdn Bhd v Chung Yoke Onn [1985] 2 MLJ 319
Architects Act 1967 (Act 117) (Rule 29 (17)
Ac Ho Sdn Bhd v Ng Kee Seng (T/A Konsultant Senicipta) [1998] 2 MLJ 393.

strongly or lightly or even resting by its own weight to the land. It also taken
consideration the extend of the injury upon the objects removal. The more
damage is caused, the more likely it is considered to be part of the land. The
installation of site office are different from normal buildings since they are
temporary structures and need to cater for construction during building
erection. Site Office is resting by its own weight to the land and minimal
connection due to the portability of the site office. Thus, the extend of injury
upon the site office removal is minimal.
The other test is the Purpose of Annexation which taken consideration whether
the object was meant for permanent and substantial improvement or just a
temporary purposes. The intention for the site office installation is only during
construction period. It is consistent as per preliminaries clause which required
contractor to provide adequate site office during construction. Thus, the
purpose of the site office is only meant during construction and no longer
required after the construction is completed and it is obsolete.
Based on the case of Goh Chong Hin v. Consolidated Malay Rubber (1924) 5
FMSLR 86, the general principle is that all fixtures attached to the land will
pass to the purchaser. Using the same principle as Goh Chong Hin v.
Consolidated Malay Rubber case, the site office is not a fixture.

CONCLUSION
Referring to Issue One, Strong Contractor are not liable to pay Clever Architect
the drawings, but Strong Contractor cannot get the money back due to his
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acknowlegdement of their rights and their case were considered mistake of

law.
The conclusion of Issue Two is that the agreement between the Professional
Architect and the client can be terminated by giving a written notice to other
party which is in contract. The validity of the written notice is sixty days (60)
from the date of written notice. Expiry of the sixty days (60), the termination
will be take effect. However the period of validity can be shorten as agreed by
both party. The notice of thirty days of termination by Smart Developer is not
valid, and the validity of the notice is sixty days from the date of the notice.
It can be concluded that in Issue Three, site office is not attached to the land
and resting by their own weight are not considered as part of the land and it is
a chattel ,not a fixture. Strong Contractor are not required to reinstalled the
site office.

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