of cos you can.
you can even sue.
you can do whatever you want actually, no one to stop you.

but whether he will pay the penalty or
the sue is successful or not is another matter.

There is already tell tale signs already when you mention that the contractor keep delaying the completion. From April to Sept is already close to half a year.
Think about this. Will the contractor continue to work if he does not get his payment? Who is to lose? The contractor will just pack and leave when you refuse his claim. He has nothing to lose.
It's time you start taking all the necessary precautions before it is too late.

In legal point of view... You can't impose any deduction if there is no agreement made since beginning....

If you wanted to sue or penalty him, you need make sure the few main point :-

a) Did you make changes upon work commenced ?
b) Did you buy any material yourself? If yes, did you purchased and delivered as per schedule or on-time?
c) Did your Designer provide you any confirmation on the time frame?

tat is because dont simply trust those no profile designer. or dealing with those freelance designer jz to wan cheap price or fresh grad come out find partner contractor den want to become taukeh. Deal with those branded or experience with good profile at least less headache. U have no choice. stop or continuous and he keep provide u rubbish quality work.

work done how many %, then are the designer staffs still commencing the works or not?

TS, under common law you still can get him to compensate you. But you need to proof and quantify what loses have you suffer as a result of the delay.

From the reading of TS's reply, it seems that he is naive, thinking that he will have the upper hand over the designer/ contractor. Never read those other house owner's predicament with the contractors.
Wish him good luck.

The point is are you confident to handle the situation if the situation deteriorate.
eg.
1.He delay some more, dunno when maybe 2 years then he lose interest. They your 200/month penalty will be irrelevant.
2.Can you get another contractor to continue and complete the work with the same balance cost?
3. Both of you get mean and start @#$%^&*() with each other, can handle the consequences?

These horror stories are splattered all over this forum.

Good Luck..

This guy still don't get the point that most of guys above have been trying tell him. Wasting you time la...
Don't take the effort to read the replies posted.

No written agreement, how do you expect to deduct for for delay penalty? Think you can just deduct without the other party's (designer) agreement? When time comes, there is bound to be lots of dispute. End of day who suffer? Mostly it will be the house owners.
There are so many horror experience of house owners with their contractors. If you just take the effort to read them.
If you are still lazy, then at least read this....

http://forum.lowyat.net/topic/1377224

The contractors will claim for their work done as it progresses. Do you think they will allow deductions from the progress claims? Fat hope. If they cannot make profit from the work done, you think they will still carry on working at your house? They are here to make money. Common sense prevail..
Don't be surprise that later TS will later put up his grievances in the 
"A Big "NO NO" to this contractor, Bad contractor not to be appointed!!! (Renovations)"
or start his own thread - House Owner con by Designer 

or maybe he will suffer in silence....

Guys, no point is wasting your time on someone that is arrogant...

Someone earlier on has already mention to look up the link to the thread about house owners facing problems with their renovation contractor. Then, I have taken the effort to post the link itself for you. Save you the trouble. Still don't want to read 

And someone also mentioned "These horror stories are splattered all over this forum."

Basically people already saying that you will not have the advantage thinking that you can just deduct from contractor.

Even like this you still don't understand, then don't know what to say....

On the legality.
The talking on the legality about deducting the penalty for delay, then you better to check with your lawyer.

The living design is quite nice.

It is very nice despite the obstacles that you encountered earlier. I hope my house will turn out to be at least 10% of yours. 

pleasant looking!
r those downlights 4"?

I just curious....may i know how much the total reno?

furniture 100k havent include electrical appliances and lights, right?

ok wat i think kitchen is simple & nice.
slightly different style & color tone from d other parts of the house, not so boring 
aside to TS, may i know wat material is da TV wall panel/board (i mean the grey wall)? izit laminated board or juz wallpaper?
i like it coz it looks like cement!

Can i know what is the name for the grill u are using? It look very simple and nice.

Tq

nice design! btw, those r 3d rendered image or the actual thing?