Quantum meruit: determining reasonable compensation beyond construction contract

This study explores the complexities of quantum meruit claims in construction, where disputes over payment and time are common. Quantum meruit claims, which seek compensation for work done, can arise from either contractual or restitutionary grounds, creating legal ambiguity and inconsistent outcomes. Contractors often face uncertainty in choosing between a contractual or quantum meruit claim, as the legal standards for determining reasonable compensation are not well-established. The research aims to identify how Malaysian courts have approached such claims over the past decade. Adopting a doctrinal methodology, the study reviewed 285 cases found using the keywords ‘quantum meruit’ and ‘construction’ via a commercial caselaw database. Twenty-nine recent cases were selected for detailed analysis using the Preferred Reporting Items for Systematic Reviews and Meta-Analyses method. The findings show that courts generally consider three main principles when assessing entitlement: the absence of a valid or enforceable contract – in restitutionary claims, the criteria set out in the Siow Wong Fatt case and plead quantum meruit claims substantially. In determining the quantum of compensation, Malaysian courts apply five key approaches: reliance on the claimant’s valuation, expert evidence or testimony, actual construction costs, negotiated prices, and the defendant’s valuation.