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i NED University of Engineering and Technology, Karachi Civil Engineering Department CE-545 Construction Claim Management Term Paper “Claims in the Construction Industry of Pakistan – Issues on the Contractor side and Recommendations for Improvement” Prepared by: Course Instructor: Mr. Waleed Mazhar Kalhoro/CE-107 Prof. Rizwam Ul Haque Farooqui
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CE-545_Term Paper Final Report_Waleed Mazhar Kalhoro_Construction Mngt._wk

Sep 27, 2015

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Claims in Construction in Pakistan
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  • i

    NED University of Engineering and Technology, Karachi

    Civil Engineering Department

    CE-545

    Construction Claim Management

    Term Paper

    Claims in the Construction Industry of Pakistan Issues on the Contractor side and Recommendations for Improvement

    Prepared by: Course Instructor: Mr. Waleed Mazhar Kalhoro/CE-107 Prof. Rizwam Ul Haque Farooqui

  • ii

    Abstract

    This study was carried out to highlight the issues faced by contractors in Pakistani

    construction industry and recommend plausible solution for such. In this study it was found

    that there are three major that prevails in Pakistani Construction industry. They are poor and

    insufficient documentation, secondly concerned individual with innate knowledge of site

    work play mere or no part in generating claims and lastly communication barrier stalls the

    claim management pace and entail huge cost. Therefore its recommended that step for

    better site work documentation, encouraging concerned people to play their part in claim

    preparation and better communication amid Contractors and Engineers should be taken to

    scrap of such issues in Pakistani construction industry.

  • iii

    TABLE OF CONTENTS

    TITLE PAGE i ABSTRACT ii TABLE OF CONTENTS iii Chapter 1: Introduction 1-2 1.1 Scope 1 1.2 Objective 1 1.3 Methodology 1 1.4 Limits and Exclusions 1 1.5 Term Paper Timeline 2 Chapter 2: Literature Review 3-12 2.1 Introduction 3-4 2.2 Issues amid Claims 4-7 2.2.1 Record keeping and Documentation 4-5 2.2.2 Contract Knowledge 5 2.2.3 Change Orders 6-7 2.2.4 Planning and Schedules 7 2.2.5 Future relations concerns 7 2.3 Claim Management 8-12 2.3.1 Record Keeping and Documentation 8-9 2.3.2 Notification of Change 9 2.3.3 Contract 9-10 2.3.4 Planning and Schedules 10-11 2.3.5 Proactive Action 11-12 Chapter 3: Methodology 12-15

    3.1 Record keeping 12-13 3.2 Change Order 13-14 3.3 Contract Knowledge 14 3.4 Claim Preparation 14-15

    Chapter 4: Data Analysis 15-16 4.1 Mean 15 4.2 Standard Deviation 15-16 4.3 Importance Index 16 Chapter 5: Results and Discussion 17-24 5.1 Record keeping 17-18 5.2 Extent of use of project documentation 18-19 5.3 Change Order 19-21 5.4 Contract Knowledge 21-22 5.5 Claims Preparation 22-24 5.5.1 Responsibility of Claim preparation 22 5.5.2 Time Involved in preparing Claim 22-23 5.5.3. Cost of preparing claim 23 5.5.4 Reasons for Delay in Claim preparation 24 Chapter 6: Conclusion and Recommendations 24-25 APPENDIX A 26-30 APPENDIX B 31-40 REFERENCES 41

  • Claims in the Construction Industry of Pakistan

    1

    1. Term Paper Introduction

    1.1 Project Scope

    Identifying the reasons behind claim generation and its respective preparation issues

    from Contractors perspective in Pakistan construction industry.

    1.2 Objective

    In the study we will identify reasons incurred by Pakistani contractor for claim

    generation and simultaneously study the issues that lingers contractors in the midst of

    claim preparation.

    1.3 Methodology

    1. Firstly Literature Review will be carried out to identify skill and attributes.

    2. A questionnaire will be developed, and response will be sought from contractors

    3. Statistical analysis will follow to evaluate respondents response; coherence will be

    evaluated and key issues will be highlighted.

    4. Conclusion will be drawn as per analysis.

    5. Recommendation will cease the term paper.

    1.4 Limits and Exclusion

    Study will be limited to Contractor working within Karachi only.

    Statistical analysis will include Mean, Standard Deviation, and Importance Index.

  • Claims in the Construction Industry of Pakistan

    2 Exhibit 1Term Paper Timeline

    1.5 Plausible Table of Content

    The chronology of Content can be estimated as follow

    1. Abstract

    2. Literature Review

    3. Methodology

    4. Result Compilation/Statistical Analysis

    5. Analysis and Discussion

    6. Conclusion

    1.6 Term Paper Time Line

  • Claims in the Construction Industry of Pakistan

    3

    2. Literature Review

    2.1 Introduction

    The term "construction claim" is commonly referred as any application by the contractor

    for payment that arises other than under the ordinary contract payment procedures.

    Potential of claims rises when the contractor incurs additional costs and/or there is a delay

    amid his contract. The clam is an instrument used by contractors to request more time

    and/or money. Claims can also originate with the owner and are defined as the assertion

    of right to payment arising under the contract for neglect or delay on the part of the

    contractor (Jergeas & Hartman, 1994).

    Claims may arise during a construction project from numerous reasons. Such reason

    include: (Jergeas & Hartman, 1994)

    Increase in scope of work pertaining to changes, extras and errors.

    Insufficient bid information

    Faulty and/or late owner-supplied equipment and material

    Inferior quality of drawings and/or specifications, giving rise to ambiguities in contract

    requirements.

    Insufficient time for bid preparation

    Stop-and-go operations because of lack of coordination, design information,

    equipment, or material

    Work in congested areas and overcrowding

    Acceleration to regain schedule

    Inadequate investigation before bidding

  • Claims in the Construction Industry of Pakistan

    4

    Unbalanced bidding and underestimation.

    Authors Dickmann and Nelson have found that the most common causes for a contract

    claim are design changes and errors. A comprehensive analysis of claims indicates that 46%

    resulted from design errors. An additional 26% were due to either discretionary or

    mandatory changes. Thus 72% of all contract claims can be traced to design changes, extra

    work, and errors (Jergeas & Hartman, 1994).

    Contractors normally adopt a claims-conscious attitude and utilize claims as a profit center

    (Hassanein & El Nemr, 2008).

    2.2 Issues amid Claims

    2.2.1 Record Keeping and Documentation

    Contractors generally fail to protect their contractual position in the case of a claim. This

    situation arises from failure to completely understand and actively manage the contract,

    or failure to keep proper records (Jergeas & Hartman, 1994).

    Maintain proper job records on a timely manner including time sheets, diary records,

    reports, photographs, records of labors and weather and its effect on progress, progress

    of the construction, site instructions, etc. (Zaneldin, 2006).

    Proper documentation is imperative for Contractor as they eventually allow them to justify

    and quantify requests for adjustment to the contract price and/or duration. Generally it

    has been observed that most Contractors dislike paperwork an attitude easily

    understood, but difficult to defend in litigation or arbitration. Notice provisions in

    contracts are often neglected, extra work is routinely performed without written

    authorization (on a limited scale), change orders are not qualified, erroneous or biased

  • Claims in the Construction Industry of Pakistan

    5

    minutes of site meetings are not objected to, self-serving letters are left unanswered,

    written notes of important telephone conversations or verbal instructions are rarely

    maintained, and contractual defaults by the owner are not documented or confirmed by

    letter. (Jergeas & Hartman, 1994).

    In a research conducted in the UK concerning the reasons for consultants' rejection of

    contractors' claims, one of the main causes were poor information systems and

    documentation practices by contractors (Vidogah & Ndekugri, 1997).

    A cultural factor has been identified as a possible cause for the lack of notification and

    documentation in construction sector, namely the "fear of consultant phenomenon"

    (Hassanein & El Nemr, 2008).

    2.2.2 Contract Knowledge

    All too often contractors do not read the contract document before bidding and, in many

    instances, not even when they execute the document. Its imperative that contractors'

    site superintendent should fully review the contract documents and compare them with

    those that were bid; (Jergeas & Hartman, 1994).

    A significant number of contractors do not quote a contract clause when preparing a claim

    (Hassanein & El Nemr, 2008)

    In the event of ambiguity, the courts of most jurisdictions will decide against the author

    of a contract, this was assumed to stem form their lack of knowledge with contract and

    its relevant clauses (Hassanein & El Nemr, 2008).

  • Claims in the Construction Industry of Pakistan

    6

    2.2.3 Change Orders

    Change order claims constitute the majority of claims in the industrial sector, as they

    represent approximately 54 percent of the total number of claims (Hassanein & El Nemr,

    2008).

    Site supervisors should not develop the habit of waiving claim rights by negotiating and

    signing off on change orders that pay part of the extra costs. If the site superintendent

    cannot assess in detail the aforementioned impact costs at the time of issue, contractors

    must consider indicating that the change only covers the direct costs incurred in

    performing the work and should formally preserve their right to recover other costs

    associated with the added work at a later date (Jergeas & Hartman, 1994).

    Have signed change orders before starting doing these changes on site (Zaneldin, 2006).

    Oral change order have to contractual weight (Hassanein & El Nemr, 2008). The

    relationship between oral change orders and documentation is that frequent verbal

    instructions with no supporting documentation bar the contractor from recovering the

    associated incurred expenses (Hassanein & El Nemr, 2008).

    Two Canadian construction lawyers advise contractors to include the following two

    qualifications in the change-order quotation to preserve the contractor's right to bring the

    impact claim of the cumulative effect of change orders later (Jergeas & Hartman, 1994):

    'We hereby reserve all our rights to claim subsequently for the costs, of any nature

    whatsoever, other than direct costs, associated with the performance of this extra work

    and the delays which may result. (Blaikie 1986)

  • Claims in the Construction Industry of Pakistan

    7

    "The above price does not include any impact or delay costs that may result from this

    change in the work or from the cumulative effect of this and other changes, and the right

    to claim such costs is hereby reserved." (Kenny 1990).

    2.2.4 Planning and Schedules

    Finishing a project on schedule is a difficult task to accomplish in the uncertain, complex,

    multiparty, and dynamic environment of construction projects (Zaneldin, 2006)

    Planning is pivotal amid project, and must be based on clearly defined objectives. With

    proper planning, adequate resources are timely available, adequate time is allowed for

    each activity. Planning and scheduling should be cost effective, simple, and practical

    (Jergeas & Hartman, 1994).

    Scheduling techniques range from simple hand-drawn bar charts to computerized

    network analysis. The most suitable presentation of schedules for contractors is the bar

    chart, which should be based on the critical path method (CPM) (Jergeas & Hartman,

    1994).

    2.2.5 Future relation concerns

    Contractors sometimes waive their contractual rights due to fear of bruising their business

    relations with the owners and consultants, which could affect their chances as candidates

    for future potential projects (Hassanein & El Nemr, 2008). Fear of losing bargaining power

    of the Client and the Engineers, were highlighted as limits of the external environment

    (Klee, 2013).

  • Claims in the Construction Industry of Pakistan

    8

    2.3 Claim Management

    1. Record Keeping and Documentation

    Records and documentation play a very important role in the settlement of contract claims

    (Chovichien, n.d.). "The paperwork" is an important part of project management and

    claims have to be solved in formal way (Klee, 2013).

    Contractors must establish and maintain a good record-keeping system that documents

    job progress and problems as they occur. Such a record system should monitor cost, time,

    scope, and quality. Daily-progress reports should be kept and should indicate the date,

    weather and temperature, type of work in progress and quantities produced, and

    hindrance to job progress and by whom. Photographs and video films (in cases where not

    prevented by contract documents) should be taken on a routine basis (dated and with

    commentary) to show construction progress, site conditions, and particular problems

    encountered (Jergeas & Hartman, 1994).

    One of the most important tools for proper documentation management is the use of

    daily records from the site team, particularly if these documents were signed by the

    consultant (Hassanein & El Nemr, 2008).

    Record should be maintained in form of memoranda pertaining to conversations,

    inspections, directions, or observations. Further records of correspondence between

    parties to the contract; minutes of weekly job-site meetings and other meetings; notes of

    telephone conversations, progress-billing certificates and all data submitted to support

    such requests; cost and productivity reports; delivery reports of owner-supplied material

    and equipment; diaries; job schedules (periodically updated); transmittals; drawings and

  • Claims in the Construction Industry of Pakistan

    9

    specifications; shop drawings; vendors' drawings and specifications; change orders and

    associated documentation; inspection reports; and accident and site safety reports

    (Jergeas & Hartman, 1994).

    Another form of record management is that of information technology system within the

    organization. Electronic document management systems allow information stored in

    different forms to be linked and accessed in a flexible manner (Vidogah & Ndekugri, 1997).

    It is recommended that contract awareness should not be restricted to high-level site

    management, but should be directed to site engineers directly dealing with the consultant

    or owner's representative (Hassanein & El Nemr, 2008).

    2. Notification of Change

    Construction claim notification involves alerting the other party a potential problem in a

    manner that is non-adverserial. Time limit requirements are very crucial and critical

    (Chovichien, n.d.). An initial letter of a claim notice to the other should be concise, clear,

    simple, conciliatory, and cooperative. It should indicate the problem and alert the other

    party of the potential increase in time or cost (Kululanga, et al., 2001)

    3. Contract

    Articles in the section of the contract entitled "General Conditions" dealing with the

    following matters should be considered to ensure the contract is complete with respect

    to the terms and conditions to have a dispute mechanism (Jergeas & Hartman, 1994):

    a. Changes/extras

    b. Disputes

    c. Disclaimer

  • Claims in the Construction Industry of Pakistan

    10

    d. Authority/roles/definitions

    e. Soil/sit conditions

    f. Delay

    g. Payment

    h. Notice provisions.

    To enhance the chances of success, contractors submitting claims must closely follow the

    steps stipulated in the contract conditions, provide a breakdown of alleged additional

    costs and time, and present sufficient documentation (Zaneldin, 2006).

    Clauses regarding the requirements for documenting minutes of meetings as well as

    exchanged correspondence should be included in contracts. In case of either party's

    failure to fulfill such contract requirements, it should be clearly stated that the party at

    fault must waive its right regarding the matter in request (Hassanein & El Nemr, 2008).

    Have a clearly written contract with no ambiguity, read the contract several times before

    signing it, to understand any unclear clauses, its advised that a third party should be asked

    to read contract documents before the bidding stage. Use special contracting provisions

    and practices that have been used on past projects, which proved to be successful in

    avoiding and resolving disputes during construction (Zaneldin, 2006).

    4. Planning and Schedules

    The regular updates and issuance of the schedule to the owner is a very effective

    communication tool and is generally considered to satisfy the legal requirements for

    providing notice of problems and associated delays (Jergeas & Hartman, 1994).

  • Claims in the Construction Industry of Pakistan

    11

    The schedule can be used to determine the impact of changes to the plan and to establish

    a cause-and-effect relationship in a claim situation, i.e. the impact of delays, reduced or

    increased resources, scope changes, resequencing and other workflow changes to current

    activities (Jergeas & Hartman, 1994).

    5. Proactive Action

    Contractors' site supervisors and project managers should consider the following

    proactive steps to protect contractors' interests and reduce liability (Jergeas & Hartman,

    1994):

    1. Request appropriate extension of time whenever significant events occur which may

    entitle you to an extension of time and make it clear who pays for the costs of

    extended duration.

    2. Make it clear who pays for acceleration.

    3. Respond as quickly as possible to every complaint initiated by the owner.

    4. Analyze job progress in detail prior to any job-site-progress meetings that are held.

    Such meetings should be used as a forum for discussing and notifying potential or

    current delays, extra work, etc.

    5. Record in detail all delays and man-hours lost, conflicts, and discrepancies. Inform the

    owner when delays occur so that the contractor does not incur responsibility due to

    lack of information.

    6. Carefully read all correspondence and minutes of meetings and promptly record any

    disagreements you may have with them.

  • Claims in the Construction Industry of Pakistan

    12

    7. Obtain written confirmation of all oral directives issued by the owner or engineer. If

    they do not confirm in writing, the contractor should write a confirmation letter to

    them.

    8. Forward any significant information received from or sent to the owner to senior

    management so that they can keep current with the project and determine if further

    specific activity is required

    9. Wait for authorization before proceeding with changes and extras. Without proper

    directive to do such work, contractors will typically be deemed to be a volunteer in the

    performance of the extra work and may not be paid.

    10. Qualify the basis of, and limitations to, the pricing of your change.

    Gregorc and Weiner (2009) mention that within a project of certain value there should be

    a resident Claim Manager on the project team. This specialist would be responsible for CM

    (Klee, 2013).

    3. Methodology

    3.1 Record Keeping

    To ascertain proper paperwork amid construction endeavor, we asked whether they had

    defined, isolated and tangible procedure of maintaining site paperwork.

    In order to evaluate contractor keenness in timely maintenance of daily reports and other

    related paper works pertaining to site works, we asked them to rate their answer on scale

    of 1-4, with 1-never, 2-sometimes, 3-mostly and 4-always

    In order to evaluate the extent of how many time contractors did lose their claim (given

    any claim was ever filled) or faced difficulties in defending their claims in litigation,

  • Claims in the Construction Industry of Pakistan

    13

    pertaining to insufficient data provided at their end, we asked contractor to rate such

    instance on a Likert scale of 1-5. Where 1-Always, 2-mostly lost/ faced difficulties, 3-Never

    filled any claim, 4-few times lost/faced difficulties and 5-Never.

    Further we inquired of contractor of any electronic document management system

    (EDMS) or any software of same essence.

    Lastly contractor were asked to rate extent of use of Project documentation while

    preparing claim, for this reason 12 different documents were rated on a scale of 1-4, with

    1-never used, 2-sometime used, 3-moderatly used and 4-always used.

    3.2 Change Orders

    In order to evaluate the frequency of change order received from client, we asked

    contractor to rate the extent of such frequency on scale of 1-4, where 1-never received, 2-

    sometimes received, 3-most of times, 4-all the times.

    Contactor were also asked whether they used to issue notification before commencing

    work on change order, oral change order or any other change exercised.

    We also inquired contractors of any oral change order and their respective frequency,

    similarly the responses were rated on scale of 1-4, with 1-never received, 2-sometimes

    received, 3-most of times, 4-all the times.

    Further we evaluated the extent to which contractor succeeded in defending such oral

    change amid claims, similarly the responses were rate on a scale of 1-4, with 1-never

    defended, 2-sometimes defended, 3-most of times defended and 4-always defended.

  • Claims in the Construction Industry of Pakistan

    14

    Were there any occasions where contractor waived it right by signing of change order

    without explicitly mentioning cost and time repercussion, for such we asked contactors in

    affirmation or negation.

    3.3 Contract Knowledge

    We asked contractors to rate the extent to which they study and analyze bidding

    documents. Reponses were evaluated on percentage of document studied, i.e. 0-30%, 30%-

    50%, 50%-80% and 80%-100%.

    In order to evaluate the contractors knowledge pertaining to bidding documents, we

    asked them whether they had included the claim clause when filing such claims.

    3.4 Claim Preparation

    The preparation and evaluation of claims require some effort and skill on the part of the

    contractor. Naturally the level of skill and experience applied to the claims management

    function can determine the success or failure of the claim (Vidogah & Ndekugri, 1997).

    In order to evaluate the extent to which different entities of contractors involved during

    claim management, we asked contractor to rate the involvement of each professional on

    a Likert scale of 1-5.

    Where 1-no involvement, 2-meagre involvement, 3-no concerned, 4-moderate

    involvement and 5-total involvement

    Preparation of claims is a tedious process. For such reason contractors tend to leave claims

    until project completion (Vidogah & Ndekugri, 1997). With that in mind contractors were

    asked to rate eight aspects of the claims preparation process in term of time involved,

  • Claims in the Construction Industry of Pakistan

    15

    responses were evaluated on a scale of 1-4, with 1-readily available 2-minimum time

    required, 3-moderate amount of time, 4-huge amount of time.

    Further contractor were asked to rate the cost incurred pertaining to acquisition of

    different information, for that reason similar 8 aspect were rated on scale of 1-4, with 1-

    very cheap, 2-meagre cost 3-substantial cost 4-very costly.

    Reason for delay amid claim preparation were also evaluated, for this reason 10 reason

    were rated on a scale of 1-4, with 1-not responsible, 2-mere responsible, 3-moderately

    responsible and 4-very much responsible.

    4. Data Analysis

    Statistical analysis included Mean, Standard Deviation, and Importance Index.

    4.1 Mean

    Mean ranking (where applicable) was calculated for each case, using following expression.

    Calculation of mean was of prime importance in calculating importance index, which

    would ultimately rank particular options under various heads.

    =

    Where;

    ai= Rank by each respondent.

    4.2 Standard Deviation

    Standard Deviation evaluates the extent of variation or dispersion from the average.

    Following expression is used for the purpose

    = [( )]

  • Claims in the Construction Industry of Pakistan

    16

    Where

    = Standard Deviation

    = mean

    X = Individual Rank by respondents.

    4.3 Importance Index

    Information incurred from respondent was used to develop an Importance Index (II). In

    calculating Importance Index (II) mean and standard deviation were calculated. Numerical

    score of each option from various heads were converted into relative importance index to

    assess the relative ranking.

    The importance index will be calculated using following calculation

    , (0 1)

    Where

    w = average weighting given to each factor by the respondent, in our

    different heads were evaluated on scale of 1-5, and 1-4, for case where scale was 1-5, 1

    being least respective rank 5 being most respective rank, similar is the case for scale of

    1-4 scale.

    A = the highest weighting; and

    N = the total number of respondents

  • Claims in the Construction Industry of Pakistan

    17

    5. Results and Discussion

    5.1 Record Keeping

    As part of my research I intended to know to what extent, contractors austerely maintain

    daily reports and other paperwork related to site work, upon research it was found out

    that 47% of contractors never or sometimes

    maintain such documents. In the absence of

    any tangible, concrete and timely

    maintained data indigenous to site, this fact

    could be established with certainty that any

    resulting efforts will prove to be tedious and

    in worst case scenario futile to defend contractors claim. However this condition is

    balanced , but such condition cant be classified as promising because basic site paperwork

    are essential and pivotal when it comes to claims, especially in Contractors perspective.

    In continuum with previous discussion, Contractors were also inquired about instances

    where they failed to defend their claim pertaining to insufficient data, the results

    advocates for previous discussion. The

    biggest number amid this paradigm is where

    contractors never filed a claim, this situation

    could be traced back to our previous

    discussion where almost half of time

    contactors dont maintain timely site

    paperwork, and in such situation where

    Never12%

    Sometimes

    35%

    Mostly18%

    Always35%

    TIMELY_MAINTAIN

    Always Lost12% Mostly

    Lost/faced

    difficulties

    24%Never filled a claim35%

    Few times

    lost/faced

    difficulties

    29%

    INSUFFICIENT DATA

  • Claims in the Construction Industry of Pakistan

    18

    contractor lack the prove, filling a claim would be adding insult to injury. Upon research

    36% of Contractor always lost or mostly faced difficulties proving their claim, such situation

    is another testament to previous discussion. Holistically speaking its a 70-30 ratio where

    contractor lost or faced difficulties amid proving their claim.

    Lastly we inquired is there were any

    Electronic Document Management System

    or any sort prevalent amid contractors, and

    results were no different than previous

    situation, 82% of the contractors asked,

    answered in negation of any EDM system

    prevailing in their company, with so much

    complexity and huge quantum of information, contractor should seek an EDM system to

    timely and prudently maintain there documentation, which could yield favorable

    outcomes for them and even result in profitability.

    5.2 Extent of use of project documentation

    One needs tangible data to substantiate it claims. Therefore in order to substantiate their

    claim contractors were asked to rate the extent of usage of particular project

    documentation. Results indicate that revised drawings, conditions of contract and

    specifications are most intensely used documentation. It is fair to say all these

    documentation are drafted during the phase where conflicts are minimal or absent, such

    documents are based on assumption and by the book, referring such documents while

    preparing a claim will not be wise decision, because any claim that arises is because of the

    Yes18%

    No82%

    EDMS

  • Claims in the Construction Industry of Pakistan

    19

    disparity amid whats written and whats been done, and since youre not using any

    documents to highlight the second part which whats been done, you cant balance the

    situation and resultantly will face backlash when preparing and defending a claim. Results

    show that contractors merely used site diaries and minutes of site meeting to substantiate

    their claims, and such information is most useful in defending what actually happened on

    site.

    Document Importance Index Rank

    Bill of quantity 0.779 4

    Claim documentation 0.691 10

    Minutes of Site meetings 0.721 10

    Schedules 0.750 7

    Photographs 0.765 6

    Site Diaries 0.691 10

    Conditions of Contract 0.853 2

    Correspondence 0.779 4

    Daily Diaries 0.662 12

    Records of Delay and Disturbance 0.721 8

    Specification 0.794 3

    Revised Drawings 0.912 1

    5.3 Change Orders

    Change order are integral part of

    construction business, there is hardly a

    project where contractors dont taste the

    medicine of change order. Upon research

    94% of contractors received a change order

    differing in frequency. Such a fact

    Never received

    6%

    sometimes

    received47%

    Most of the times received

    23%

    All the times

    received24%

    CHANGE_ORDER

  • Claims in the Construction Industry of Pakistan

    20

    adamants that there is a dire need to establish a protocol where contractors are at better

    place to defend any discrepancies resulting from change orders.

    Another nightmare for contractors are Oral Change orders, there frequency is no more

    different or should I say more than formal

    change orders. It is evident that there was no

    contractor who did not received an oral

    change order, all contractors asked, did

    received an oral change order with differing

    frequencies. Further we also enquired to

    what extent were such change orders defended successfully, results depicts that 88% of

    contractor never or sometimes defended their oral change orders. 29% of never defending

    oral change order is quite evident and self-explanatory however 59% of contractors stating

    that they sometimes succeed in defending their change oral change order, was further

    enquired and they stated that only payments

    were reimbursed on the basis on quantum

    majeure. Thus its imperative that contractors

    should seek a formal change order, however

    pertaining to local hiccups contractor cant

    afford such a luxury pertaining to social and

    time issues.

    sometimes

    received35%

    Most of the times received

    35%

    All the times

    received30%

    OCO_RECEIVED

    Never defended

    29%

    sometimesdefend

    ed59%

    Most of the times defended

    12%

    OCO_DEFENDED

  • Claims in the Construction Industry of Pakistan

    21

    Further contractor were asked, were there any

    occasions where they waived their right by

    signing of change order without explicitly

    mentioning cost and time repercussion, results

    are promising with 76% of contractors answering

    in negation.

    5.4 Contract Knowledge

    Studying bidding documents is tedious yet imperative job, upon research this fact was

    established that 47% of Contractors study about

    50% of the bidding documents, with 12% on

    contractors only studying 0-30% of bidding

    documents such dismal study of bid documents

    from substantial amount of contractors is

    alarming and astonishing, such inferior

    information of bidding document lead contractors

    into Claim dilemma. Again relevant situation is

    balanced, but balanced is not an option here

    contract bid documents are core document and

    every other contemporary document finds its

    foundation on bid documents, therefore

    contractors must show resolve on studying bids

    Yes24%

    No76%

    WAIVING_CLAUSE

    0%-30%12%

    30%-50%35%

    50%-80%29%

    80%-100%24%

    BID STUDYING

    Yes65%

    NO35%

    CLAIM CLAUSE ADDITION

  • Claims in the Construction Industry of Pakistan

    22

    documents to their fullest. Also 65% of contractors add a claim clause when preparing a claim,

    and 35% dont. Such number should be higher.

    5.5 Claim Preparation

    5.5.1 Responsibility of Claim preparation

    Contractors rated different entities amid contractors on the extent to which they play a part

    in preparing a claim. Results indicates that claim managers and project manager are the most

    enthusiast in preparing a claim, while site engineer is least involved in preparing a claim.

    Project Manager even though heads the project, but he doesnt have any firsthand

    information of site work similar is the case with Claim Manager, he is completely alien to site

    work, still they are mostly involved in preparing a claim, on the other hand site engineer who

    has firsthand and indigenous information pertain to site work is least used when preparing a

    claim, such a situation is self-explanatory where most suited individual is absent in the process

    of claim preparation and individuals with merge and alien knowledge are most enthusiast

    while preparing a claim.

    Staff Importance Index Rank

    Project Manager 0.282 2

    Project Quantity Surveyor 0.211 5

    Head Office-based Quantity Surveyor 0.236 3

    Site Engineer 0.166 7

    Claim Manager 0.283 1

    External Claim Consultants 0.186 6

    Others 0.236 3

    5.5.2 Time Involved in preparing Claim

    Time is of essence, so is the case while preparing a claim. Contractors were asked to rate the

    extent of time involved in preparing claim. Results indicate that most time consuming aspect

  • Claims in the Construction Industry of Pakistan

    23

    of preparing claim are responses to architect/Engineers request for information and

    quantifying claim, indicating lack of timely correspondence amid engineer and contractor and

    also lack of specific knowledge of quantifying claim. Interpretation of contract took the least

    amount of time, referring to innate knowledge contractors possess about contract.

    Aspect of Claim preparation Importance Index Rank

    Identifying relevant information 0.721 6

    Identifying sources of information 0.779 3

    Retrieving relevant information 0.706 7

    Archiving relevant information 0.725 5

    Interpretation of contract and justifying claim 0.686 8

    Responses to architect/engineers request for information 0.804 2

    Quantifying claims 0.824 1

    Prepare claim documentation for claims 0.745 4

    5.5.3 Cost of preparing Claim

    Cost is something that imparts everybody and money is something that everybody holds most

    dear. For that reason contractors were asked to indicate which aspects of claim preparation

    entails the most cost. Results depicts that quantifying claim and responses to

    architect/Engineers request for information are the most costly and preparing

    documentation for presentation are cheapest. Such result are coherent with above

    discussion, things taking the most time, are the things requiring the most capital while

    preparing a claim.

    Aspect of Claim preparation Importance Index Rank

    Identifying relevant information 0.647 5

    Identifying sources of information 0.603 6

    Retrieving relevant information 0.691 3

    Archiving relevant information 0.691 3

    Interpretation of contract and justifying claim 0.603 6

    Responses to architect/engineers request for information 0.706 2

    Quantifying claims 0.721 1

    Prepare claim documentation for claims 0.544 8

  • Claims in the Construction Industry of Pakistan

    24

    5.5.4 Reasons for Delay in Claim Preparation

    Analysis shows that most responsible reasons for delays are awaiting responses from

    architect/engineer, poor records and lack of contemporary records, in that order.

    Reason for delay in preparing claim Importance Index Rank

    Lack of resources 0.676 7

    Showing cause and effect 0.721 5

    Lack of contemporary records 0.765 3

    Poor records 0.809 2

    Identifying and retrieving information 0.765 3

    Awaiting responses from architect/engineer 0.868 1

    Time limitations 0.706 6

    Others 0.544 8

    6. Conclusion and Recommendation

    During the course of research, this fact could be established with certainty that

    contractors have issues pertaining to claims and their respective management, however

    the essence of issues of point of debate. Some issues are inherent to construction industry

    in Pakistan, yet some issues could be rectified with proper and austere efforts. Upon

    research it was found that contractor faced three essential issues concerning claim

    management;

    1. Poor or no documentation of site work, only documentation would not suffice here,

    real issue is their timely maintenance.

    2. Lack of communication amid Engineer/Architect and Contractor, once again timely

    communication is imperative.

    3. Lastly concerned individuals are not enthusiastically while preparing claim for instance

    in our research Project Managers and Claim Manager were intensely involved in

  • Claims in the Construction Industry of Pakistan

    25

    preparing claims and site engineer , individual with indigenous knowledge of site is

    least involved.

    Therefore its recommended that issues highlighted above should be catered for with

    following recommendation is curbing such issues. In order to eradicate the ever

    lingering menace of poor and insufficient documentation, contractors should establish

    a program that should motivate concerned individuals to maintain austere site

    documentation. An EDM system could aide in this regard as Contraction Industry is on

    the road of spurt and complexity.

    Further, concerned individuals should be allowed to play their pivotal part while

    preparing claim, as they possess first hand and innate knowledge pertaining to site

    work. Lastly more efficient way of communication should be established amid

    Contractors and Engineers, and if necessary such communication should be bound by

    some contractual provisions, violation of such should be punishable by law.

  • Claims in the Construction Industry of Pakistan Appendix A

    26

    Claims in the Construction Industry of Pakistan Issues on the Contractor side and Recommendations for Improvement

    In the study we will identify reasons incurred by Pakistani contractor for claim generation and simultaneously study the issues that lingers contractors in the midst of claim preparation.

    Name Designation

    Company Current Project

    Record Keeping

    Do you timely maintain daily reports and other related paper works pertaining to site works

    o Never o Sometimes o Mostly o Always On how many instances you lost or faced difficulties to defend your claim for insufficient data provided?

    o Always Lost o Mostly lost/faced difficulties

    o Never filed a claims

    o Few times lost/faced

    difficulties o Never lost

    Is there a prevalent electronic document management system or any sort in your organization?

    o Yes o No Rate the extent to which following project documentation were used while preparing claim

    1. Bills of Quantity

    o Never used o Sometimes used o Moderately used o Always used 2. Claim Documentation

    o Never used o Sometimes used o Moderately used o Always used 3. Minutes of Site meeting

    o Never used o Sometimes used o Moderately used o Always used 4. Schedules

    o Never used o Sometimes used o Moderately used o Always used 5. Photographs

    o Never used o Sometimes used o Moderately used o Always used 6. Site diaries

    o Never used o Sometimes used o Moderately used o Always used 7. Conditions of Contract

    o Never used o Sometimes used o Moderately used o Always used

  • Claims in the Construction Industry of Pakistan Appendix A

    27

    8. Correspondence

    o Never used o Sometimes used o Moderately used o Always used 9. Daily diaries

    o Never used o Sometimes used o Moderately used o Always used 10. Records of Delay and disturbance

    o Never used o Sometimes used o Moderately used o Always used 11. Specification

    o Never used o Sometimes used o Moderately used o Always used 12. Revised Drawings

    o Never used o Sometimes used o Moderately used o Always used Change Orders

    State the extent of frequency of Change Orders received from Owner/Engineer

    o Never received o Sometimes received o Most of the times o All the time State the extent of frequency of Oral Change Orders received from Owner/Engineer

    o Never received o Sometimes received o Most of the times o All the time How many times were you able to defend such oral change orders during claims?

    o Never defended o Sometimes defended

    o Most of the times o Always defended Were there any occasions where you as a contractor waived your right by signing of change order without explicitly mentioning cost and time repercussion?

    o Yes o No Contract Knowledge

    Rate the extent to which you thoroughly study bidding documents

    o 0-30% o 30%-50 o 50%-80% o 80%-100%. Do you add claim clause from the contract when filing a claim?

    o Yes o No

  • Claims in the Construction Industry of Pakistan Appendix A

    28

    Claim Preparation Rate the extent of involvement of following entities of contractors involved during claim preparation.

    Project Manager

    o No Involvement

    o Meagre Involvement

    o Not Concerned

    o Moderate Involvement

    o Total involvement

    Project Quantity Surveyor

    o No Involvement

    o Meagre Involvement

    o Not Concerned

    o Moderate Involvement

    o Total involvement

    Head office based quantity surveyor

    o No Involvement

    o Meagre Involvement

    o Not Concerned

    o Moderate Involvement

    o Total involvement

    Site Engineer

    o No Involvement

    o Meagre Involvement

    o Not Concerned

    o Moderate Involvement

    o Total involvement

    Claim Manager

    o No Involvement

    o Meagre Involvement

    o Not Concerned

    o Moderate Involvement

    o Total involvement

    External Claim Consultants

    o No Involvement

    o Meagre Involvement

    o Not Concerned

    o Moderate Involvement

    o Total involvement

    Others Involved

    o No Involvement

    o Meagre Involvement

    o Not Concerned

    o Moderate Involvement

    o Total involvement

    Rate the flowing eight aspects of the claims preparation processes in term of time involved

    1. Identifying relevant information

    o Readily available o Minimum time required

    o Moderate time required

    o Huge amount of time required

    2. Identifying sources of information

    o Readily available o Minimum time required

    o Moderate time required

    o Huge amount of time required

    3. Retrieving relevant information

  • Claims in the Construction Industry of Pakistan Appendix A

    29

    o Readily available o Minimum time required

    o Moderate time required

    o Huge amount of time required

    4. Archiving relevant information

    o Minimum time required o Moderate time required o Huge amount of time required 5. Interpretation of contract and justifying claim

    o Minimum time required o Moderate time required o Huge amount of time required 6. Responses to architect/engineers request for information

    o Minimum time required o Moderate time required o Huge amount of time required 7. Quantifying claims

    o Minimum time required o Moderate time required o Huge amount of time required 8. Prepare claim documents for presentation

    o Minimum time required o Moderate time required o Huge amount of time required Rate the cost incurred pertaining to acquisition of different information to prepare claim

    Identifying relevant information

    o Very cheap o Meagre cost o Substantial cost o Very costly Identifying sources of information

    o Very cheap o Meagre cost o Substantial cost o Very costly Retrieving relevant information

    o Very cheap o Meagre cost o Substantial cost o Very costly Archiving relevant information

    o Very cheap o Meagre cost o Substantial cost o Very costly Interpretation of contract and justifying claim

    o Very cheap o Meagre cost o Substantial cost o Very costly Responses to architect/engineers request for information

    o Very cheap o Meagre cost o Substantial cost o Very costly Quantifying claims

    o Very cheap o Meagre cost o Substantial cost o Very costly Prepare claim documents for presentation

    o Very cheap o Meagre cost o Substantial cost o Very costly

  • Claims in the Construction Industry of Pakistan Appendix A

    30

    Rate the following 10 reason for delay in claim preparation

    Lack of resources

    o Not responsible o Mere responsible o Moderately responsible

    o Very much responsible

    Showing cause and effect

    o Not responsible o Mere responsible o Moderately responsible

    o Very much responsible

    Lack of contemporary records

    o Not responsible o Mere responsible o Moderately responsible

    o Very much responsible

    Poor records

    o Not responsible o Mere responsible o Moderately responsible

    o Very much responsible

    Identifying and retrieving information

    o Not responsible o Mere responsible o Moderately responsible

    o Very much responsible

    Awaiting responses from architect/engineer

    o Not responsible o Mere responsible o Moderately responsible

    o Very much responsible

    Time limitations

    o Not responsible o Mere responsible o Moderately responsible

    o Very much responsible

    Other

    o Not responsible o Mere responsible o Moderately responsible

    o Very much responsible

  • Claims in the Construction Industry of Pakistan Appendix B

    31

    Respondents (Contractors) Response Compilation

    Timely

    maintain Insufficient

    data EDMS BOQ

    Claim Documentation

    Minutes Site

    Meeting Schedules Photographs

    Site Diaries

    Contract Condition

    Correspondence Daily

    diaries Delay

    records

    1 Always Few times lost/faced difficulties

    No Always

    used Always used Never Used

    Always used

    Never Used Sometimes

    Used Always used Always used

    Always used

    Sometimes Used

    2 Sometimes Mostly

    Lost/faced difficulties

    No Moderately

    Used Moderately

    Used Always

    used Always

    used Always used

    Sometimes Used

    Always used Moderately

    Used Sometimes

    Used Always

    used

    3 Always Never filled

    a claim No

    Moderately Used

    Sometimes Used

    Moderately Used

    Moderately Used

    Always used Always

    used Always used Always used

    Moderately Used

    Moderately Used

    4 Sometimes Never filled

    a claim No

    Sometimes Used

    Moderately Used

    Sometimes Used

    Sometimes Used

    Sometimes Used

    Always used

    Moderately Used

    Moderately Used

    Sometimes Used

    Sometimes Used

    5 Never Always

    Lost No

    Never Used

    Sometimes Used

    Moderately Used

    Sometimes Used

    Sometimes Used

    Sometimes Used

    Moderately Used

    Moderately Used

    Never Used

    Never Used

    6 Always Never filled

    a claim No

    Always used

    Always used Sometimes

    Used Always

    used Always used

    Sometimes Used

    Always used Always used Sometimes

    Used Moderately

    Used

    7 Always Few times lost/faced difficulties

    Yes Moderately

    Used Always used

    Always used

    Always used

    Always used Always

    used Always used Always used

    Always used

    Always used

    8 Mostly Few times lost/faced difficulties

    Yes Sometimes

    Used Moderately

    Used Always

    used Moderately

    Used Always used

    Sometimes Used

    Moderately Used

    Always used Moderately

    Used Always

    used

    9 Sometimes Mostly

    Lost/faced difficulties

    No Always

    used Always used

    Sometimes Used

    Sometimes Used

    Never Used Sometimes

    Used Moderately

    Used Sometimes

    Used Sometimes

    Used Never Used

    10 Always Never filled

    a claim No

    Always used

    Never Used Always

    used Always

    used Sometimes

    Used Sometimes

    Used Moderately

    Used Moderately

    Used Sometimes

    Used Always

    used

    11 Sometimes Mostly

    Lost/faced difficulties

    No Sometimes

    Used Sometimes

    Used Sometimes

    Used Sometimes

    Used Moderately

    Used Moderately

    Used Moderately

    Used Moderately

    Used Moderately

    Used Moderately

    Used

    12 Sometimes Never filled

    a claim No

    Sometimes Used

    Never Used Sometimes

    Used Moderately

    Used Moderately

    Used Sometimes

    Used Sometimes

    Used Never Used

    Never Used

    Moderately Used

    13 Mostly Never filled

    a claim Yes

    Moderately Used

    Sometimes Used

    Always used

    Moderately Used

    Always used Always

    used Moderately

    Used Always used

    Moderately Used

    Always used

    14 Never Mostly

    Lost/faced difficulties

    No Always

    used Never Used

    Sometimes Used

    Never Used

    Always used Sometimes

    Used Always used

    Sometimes Used

    Sometimes Used

    Moderately Used

    15 Mostly Few times lost/faced difficulties

    No Always

    used Moderately

    Used Always

    used Always

    used Always used

    Moderately Used

    Always used Always used Moderately

    Used Moderately

    Used

  • Claims in the Construction Industry of Pakistan Appendix B

    32

    16 Always Few times lost/faced difficulties

    No Always

    used Always used

    Always used

    Always used

    Always used Always

    used Always used Always used

    Always used

    Always used

    17 Sometimes Always

    Lost No

    Always used

    Always used Sometimes

    Used Sometimes

    Used Sometimes

    Used Moderately

    Used Moderately

    Used Never Used

    Always used

    Never Used

    Specification Revised drawing

    Change Order

    OCO recieved

    OCO defened

    CO clause

    Bidding study

    Clause Claim

    Project Manager

    Project QC

    Headoffice QC

    Site engineer

    Claim Manager

    1 Always used Always used All the times

    received

    All the times

    received

    Sometimes defended

    No 80%-100% Yes Moderate

    Involvement Total

    Involvement Meagre

    Involvement Total

    Involvement Meagre

    Involvement

    2 Moderately

    Used Always used

    sometimes received

    All the times

    received

    Sometimes defended

    No 80%-100% Yes Moderate

    Involvement Moderate

    Involvement Moderate

    Involvement Total

    Involvement Total

    Involvement

    3 Always used Always used All the times

    received

    sometimes received

    Most of the times defended

    Yes 30%-50% NO Moderate

    Involvement Moderate

    Involvement Moderate

    Involvement Moderate

    Involvement Moderate

    Involvement

    4 Sometimes

    Used Always used

    Most of the times received

    All the times

    received

    Never defended

    No 30%-50% NO Meagre

    Involvement Moderate

    Involvement Moderate

    Involvement Moderate

    Involvement Meagre

    Involvement

    5 Sometimes

    Used Sometimes

    Used Never

    received sometimes

    received Sometimes defended

    No 0%-30% Yes No

    Involvement Moderate

    Involvement No

    Involvement Not

    Concerned Meagre

    Involvement

    6 Always used Always used Most of

    the times received

    Most of the times received

    Sometimes defended

    No 50%-80% Yes Total

    Involvement Total

    Involvement Total

    Involvement Moderate

    Involvement Total

    Involvement

    7 Always used Moderately

    Used

    Most of the times received

    Most of the times received

    Sometimes defended

    No 50%-80% Yes Total

    Involvement Not

    Concerned Moderate

    Involvement Total

    Involvement Total

    Involvement

    8 Moderately

    Used Always used

    sometimes received

    Most of the times received

    Sometimes defended

    No 50%-80% NO Moderate

    Involvement Moderate

    Involvement Total

    Involvement Moderate

    Involvement Total

    Involvement

    9 Sometimes

    Used Always used

    All the times

    received

    All the times

    received

    Never defended

    No 0%-30% Yes Not

    Concerned Moderate

    Involvement Meagre

    Involvement Total

    Involvement Meagre

    Involvement

    10 Always used Moderately

    Used sometimes

    received

    Most of the times received

    Never defended

    No 50%-80% NO Not

    Concerned Meagre

    Involvement Moderate

    Involvement Meagre

    Involvement No

    Involvement

    11 Moderately

    Used Moderately

    Used

    Most of the times received

    sometimes received

    Most of the times defended

    Yes 30%-50% Yes Moderate

    Involvement Moderate

    Involvement Moderate

    Involvement Moderate

    Involvement Moderate

    Involvement

    12 Sometimes

    Used Always used

    sometimes received

    sometimes received

    Never defended

    No 30%-50% NO Not

    Concerned Moderate

    Involvement Meagre

    Involvement Total

    Involvement Moderate

    Involvement

    13 Sometimes

    Used Moderately

    Used sometimes

    received

    Most of the times received

    Sometimes defended

    Yes 30%-50% Yes Total

    Involvement Total

    Involvement Moderate

    Involvement Moderate

    Involvement Total

    Involvement

  • Claims in the Construction Industry of Pakistan Appendix B

    33

    14 Moderately

    Used Always used

    sometimes received

    Most of the times received

    Sometimes defended

    Yes 30%-50% NO No

    Involvement No

    Involvement Moderate

    Involvement Moderate

    Involvement Moderate

    Involvement

    15 Always used Always used sometimes

    received sometimes

    received Sometimes defended

    No 80%-100% Yes Total

    Involvement Total

    Involvement Moderate

    Involvement Moderate

    Involvement Total

    Involvement

    16 Always used Always used sometimes

    received sometimes

    received Sometimes defended

    No 80%-100% Yes Not

    Concerned Moderate

    Involvement Moderate

    Involvement Total

    Involvement Moderate

    Involvement

    17 Always used Always used All the times

    received

    All the times

    received

    Never defended

    No 50%-80% Yes No

    Involvement Moderate

    Involvement Meagre

    Involvement Total

    Involvement Meagre

    Involvement

    Claim

    Consultants Others

    involved Identify

    info Identify sources

    Retrieve info

    Archiving info

    Interpretation _contract

    Architect response

    Claim quantifying

    Prepare claim

    Identify info_1

    Identify sources_1

    Retrieve info_1

    1 Moderate

    Involvement Not

    Concerned

    moderate time

    required

    huge time required

    huge time

    required

    moderate time

    required

    minimum time required

    huge time required

    huge time required

    moderate time

    required very cheap very cheap

    Substantial cost

    2 Total

    Involvement Meagre

    Involvement

    moderate time

    required

    moderate time

    required

    moderate time

    required

    huge time required

    huge time required

    huge time required

    huge time required

    moderate time

    required

    Substantial cost

    very costly Substantial

    cost

    3 Moderate

    Involvement Moderate

    Involvement

    minimum time

    required

    moderate time

    required

    minimum time

    required

    huge time required

    moderate time required

    moderate time

    required

    moderate time

    required

    moderate time

    required

    Substantial cost

    meagre cost Substantial

    cost

    4 Moderate

    Involvement No

    Involvement

    huge time

    required

    huge time required

    minimum time

    required

    moderate time

    required

    moderate time required

    huge time required

    huge time required

    minimum time

    required

    Substantial cost

    Substantial cost

    Substantial cost

    5 Meagre

    Involvement Not

    Concerned

    moderate time

    required

    moderate time

    required

    moderate time

    required

    moderate time

    required

    moderate time required

    moderate time

    required

    minimum time

    required

    minimum time

    required

    meagre cost

    meagre cost Substantial

    cost

    6 Meagre

    Involvement Moderate

    Involvement

    moderate time

    required

    minimum time

    required

    moderate time

    required

    minimum time

    required

    huge time required

    huge time required

    moderate time

    required

    moderate time

    required

    meagre cost

    Substantial cost

    meagre cost

    7 Total

    Involvement Moderate

    Involvement

    moderate time

    required

    huge time required

    huge time

    required

    moderate time

    required

    huge time required

    huge time required

    moderate time

    required

    huge time required

    Substantial cost

    Substantial cost

    Substantial cost

    8 Not

    Concerned Not

    Concerned

    minimum time

    required

    moderate time

    required

    minimum time

    required

    huge time required

    huge time required

    moderate time

    required

    huge time required

    huge time required

    Substantial cost

    meagre cost Substantial

    cost

    9 Total

    Involvement Not

    Concerned

    moderate time

    required

    moderate time

    required

    moderate time

    required

    huge time required

    moderate time required

    huge time required

    huge time required

    huge time required

    Substantial cost

    Substantial cost

    Substantial cost

    10 Moderate

    Involvement No

    Involvement

    huge time

    required

    moderate time

    required

    moderate time

    required

    moderate time

    required

    moderate time required

    huge time required

    huge time required

    moderate time

    required

    Substantial cost

    meagre cost meagre

    cost

    11 Moderate

    Involvement Moderate

    Involvement

    moderate time

    required

    minimum time

    required

    moderate time

    required

    moderate time

    required

    moderate time required

    moderate time

    required

    moderate time

    required

    moderate time

    required

    Substantial cost

    Substantial cost

    Substantial cost

  • Claims in the Construction Industry of Pakistan Appendix B

    34

    12 Moderate

    Involvement No

    Involvement

    moderate time

    required

    moderate time

    required

    moderate time

    required

    moderate time

    required

    moderate time required

    moderate time

    required

    moderate time

    required

    moderate time

    required

    Substantial cost

    Substantial cost

    meagre cost

    13 Moderate

    Involvement Meagre

    Involvement

    moderate time

    required

    moderate time

    required

    moderate time

    required

    moderate time

    required

    moderate time required

    minimum time

    required

    huge time required

    huge time required

    meagre cost

    meagre cost Substantial

    cost

    14 Total

    Involvement No

    Involvement readily

    available huge time required

    readily available

    moderate time

    required

    minimum time required

    huge time required

    huge time required

    huge time required

    Substantial cost

    very cheap very costly

    15 Moderate

    Involvement No

    Involvement

    moderate time

    required

    moderate time

    required

    moderate time

    required

    moderate time

    required

    moderate time required

    moderate time

    required

    moderate time

    required

    moderate time

    required

    meagre cost

    very cheap very cheap

    16 Not

    Concerned Meagre

    Involvement

    moderate time

    required

    moderate time

    required

    moderate time

    required

    moderate time

    required

    moderate time required

    moderate time

    required

    moderate time

    required

    moderate time

    required

    meagre cost

    Substantial cost

    Substantial cost

    17 Moderate

    Involvement Not

    Concerned

    moderate time

    required

    moderate time

    required

    moderate time

    required

    moderate time

    required

    minimum time requried

    moderate time

    required

    huge time required

    huge time required

    Substantial cost

    Substantial cost

    Substantial cost

    Archiving info_1

    Interpretation contract_1

    Architect response_1

    Quantifying claim_1

    Prepare claim_1

    Lack resources

    Showing Cause effect

    Lack Contemporary

    records Poor

    records

    Identifying Retrieving

    info Architect response

    Time limitation Others

    1 Substantial

    cost meagre cost very costly

    Substantial cost

    meagre cost

    very much responsible

    mere responsible

    very much responsible

    very much responsible

    very much responsible

    very much responsible

    moderately responsible

    Not responsible

    2 Substantial

    cost Substantial

    cost Substantial

    cost Substantial

    cost very cheap

    very much responsible

    moderately responsible

    moderately responsible

    very much responsible

    moderately responsible

    very much responsible

    very much responsible

    moderately responsible

    3 meagre

    cost very costly

    Substantial cost

    Substantial cost

    meagre cost

    moderately responsible

    very much responsible

    moderately responsible

    mere responsible

    moderately responsible

    very much responsible

    moderately responsible

    moderately responsible

    4 meagre

    cost meagre cost

    meagre cost

    Substantial cost

    Substantial cost

    mere responsible

    very much responsible

    moderately responsible

    moderately responsible

    moderately responsible

    very much responsible

    moderately responsible

    moderately responsible

    5 Substantial

    cost meagre cost

    meagre cost

    Substantial cost

    meagre cost

    mere responsible

    mere responsible

    mere responsible

    moderately responsible

    moderately responsible

    moderately responsible

    mere responsible

    mere responsible

    6 Substantial

    cost very cheap very costly

    Substantial cost

    meagre cost

    moderately responsible

    mere responsible

    moderately responsible

    very much responsible

    very much responsible

    very much responsible

    moderately responsible

    mere responsible

    7 meagre

    cost meagre cost very costly very costly

    Substantial cost

    moderately responsible

    moderately responsible

    very much responsible

    very much responsible

    moderately responsible

    very much responsible

    very much responsible

    mere responsible

    8 very costly meagre cost Substantial

    cost Substantial

    cost meagre

    cost Not

    responsible moderately responsible

    moderately responsible

    mere responsible

    moderately responsible

    very much responsible

    mere responsible

    mere responsible

    9 Substantial

    cost very cheap

    meagre cost

    meagre cost

    meagre cost

    very much responsible

    moderately responsible

    moderately responsible

    moderately responsible

    very much responsible

    moderately responsible

    moderately responsible

    moderately responsible

    10 meagre

    cost meagre cost

    Substantial cost

    Substantial cost

    Substantial cost

    very much responsible

    moderately responsible

    moderately responsible

    very much responsible

    mere responsible

    moderately responsible

    very much responsible

    mere responsible

    11 Substantial

    cost Substantial

    cost Substantial

    cost Substantial

    cost Substantial

    cost mere

    responsible moderately responsible

    mere responsible

    Not responsible

    moderately responsible

    moderately responsible

    mere responsible

    moderately responsible

    12 very costly Substantial

    cost Substantial

    cost meagre

    cost very cheap

    moderately responsible

    very much responsible

    mere responsible

    very much responsible

    moderately responsible

    very much responsible

    moderately responsible

    Not responsible

  • Claims in the Construction Industry of Pakistan Appendix B

    35

    13 Substantial

    cost very costly

    meagre cost

    very costly Substantial

    cost very much

    responsible moderately responsible

    very much responsible

    very much responsible

    moderately responsible

    moderately responsible

    mere responsible

    mere responsible

    14 Substantial

    cost very costly

    meagre cost

    Substantial cost

    meagre cost

    Not responsible

    mere responsible

    moderately responsible

    very much responsible

    mere responsible

    moderately responsible

    mere responsible

    moderately responsible

    15 very cheap meagre cost meagre

    cost meagre

    cost meagre

    cost mere

    responsible moderately responsible

    moderately responsible

    moderately responsible

    moderately responsible

    mere responsible

    mere responsible

    mere responsible

    16 Substantial

    cost meagre cost

    Substantial cost

    Substantial cost

    Substantial cost

    mere responsible

    mere responsible

    moderately responsible

    moderately responsible

    moderately responsible

    moderately responsible

    moderately responsible

    mere responsible

    17 Substantial

    cost meagre cost

    Substantial cost

    meagre cost

    very cheap mere

    responsible moderately responsible

    very much responsible

    moderately responsible

    moderately responsible

    very much responsible

    moderately responsible

    Not responsible

  • Claims in the Construction Industry of Pakistan Appendix B

    36

    Respondent Data Analysis B.1 Records Keeping

    Timely maintain

    Frequency Percent Cumulative Percent

    Never 2 11.8 11.8

    Sometimes 6 35.3 47.1

    Mostly 3 17.6 64.7

    Always 6 35.3 100.0

    Total 17 100.0

    Timely maintain

    Frequency Percent Cumulative Percent

    Always Lost 2 11.8 11.8

    Mostly Lost/faced difficulties

    4 23.5 35.3

    Never filled a claim 6 35.3 70.6

    Few times lost/faced difficulties

    5 29.4 100.0

    Total 17 100

    EDMS

    Frequency Percent Cumulative Percent

    Yes 3 17.6 17.6

    No 14 82.4 100.0

    Total 17 100.0

  • Claims in the Construction Industry of Pakistan Appendix B

    37

    B.2 Extent of use of project documentation

    N Mean Importance Index Rank

    BOQ 17 3.1176 0.779 4

    Claim_Documentation 17 2.7647 0.691 10

    Minutes_Site_Meeting 17 2.8824 0.721 10

    Schedules 17 3.0000 0.750 7

    Photographs 17 3.0588 0.765 6

    Site_Diaries 17 2.7647 0.691 10

    Contract_Conditions 17 3.4118 0.853 2

    Correspondence 17 3.1176 0.779 4

    Daily_diaries 17 2.6471 0.662 12

    Delay_records 17 2.8824 0.721 8

    Specification 17 3.1765 0.794 3

    Revised_drawings 17 3.6471 0.912 1

    B.3 Change Orders

    Change Order Received

    Frequency Percent Cumulative Percent

    Never received 1 5.9 5.9

    sometimes received 8 47.1 52.9

    Most of the times received

    4 23.5 76.5

    All the times received

    4 23.5 100.0

    Total 17 100.0

    Oral Change Order

    Frequency Percent Cumulative Percent

    sometimes received 6 35.3 35.3

    Most of the times received 6 35.3 70.6

    All the times received 5 29.4 100.0

    Total 17 100.0

  • Claims in the Construction Industry of Pakistan Appendix B

    38

    OCO Defended

    Frequency Percent Cumulative Percent

    Never defended 5 29.4 29.4

    Sometimes defended

    10 58.8 88.2

    Most of the times defended

    2 11.8 100.0

    Total 17 100.0

    Waive Clause

    Frequency Percent Cumulative

    Percent

    Yes 4 23.5 23.5

    No 13 76.5 100.0

    Total 17 100.0

    B.4 Contract Knowledge

    Studying Bidding Document

    Frequency Percent Cumulative Percent

    0%-30% 2 11.8 11.8

    30%-50% 6 35.3 47.1

    50%-80% 5 29.4 76.5

    80%-100% 4 23.5 100.0

    Total 17 100.0

    Contract Clause Addition

    Frequency Percent Cumulative Percent

    Yes 11 64.7 64.7

    NO 6 35.3 100.0

    Total 17 100.0

  • Claims in the Construction Industry of Pakistan Appendix B

    39

    B.5 Claim Preparation individual involvement

    N Mean Importance Index Rank

    Project_Manager 17 3.3529 0.282 2

    Project_QC 17 3.8824 0.211 5

    Headoffice_QC 17 3.4706 0.236 3

    Site_engineer 17 4.2353 0.166 7

    Claim_Manager 17 3.5882 0.283 1

    Claim_Consultants 17 3.8824 0.186 6

    Others_involved 17 2.4706 0.236 3

    Time Involved

    N Mean Importance Index Rank

    identify_info 17 2.8824 0.721 6

    identify_sources 17 3.1176 0.779 3

    retrieve_info 17 2.8235 0.706 7

    archiving_info 17 2.1765 0.725 5

    interpratation_contract 17 2.0588 0.686 8

    architect_response 17 2.4118 0.804 2

    Claim_quantifying 17 2.4706 0.824 1

    prepare_claim 17 2.2353 0.745 4

    Cost entailed

    N Mean Importance Index Rank

    identify_info 17 2.5882 0.647 5

    identify_sources 17 2.4118 0.603 6

    retrieve_info 17 2.7647 0.691 3

    archiving_info 17 2.7647 0.691 3

    interpratation_contract 17 2.4118 0.603 6

    architect_response 17 2.8235 0.706 2

    Claim_quantifying 17 2.8824 0.721 1

    prepare_claim 17 2.1765 0.544 8

  • Claims in the Construction Industry of Pakistan Appendix B

    40

    Reason in Claim Delay

    N Mean Importance Index Rank

    lack_resources 17 2.7059 0.676 7

    Showing_cause_effect 17 2.8824 0.721 5

    Lack_contemporary_records 17 3.0588 0.765 3

    Poor_records 17 3.2353 0.809 2

    Identifying_retriving_info 17 3.0588 0.765 3

    achitect_response 17 3.4706 0.868 1

    time_limitation 17 2.8235 0.706 6

    Others 17 2.1765 0.544 8

  • 41

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