A Study on management of claims for time extensions by Sri Lankan contractors

Abstract

Due to the complexity of civil engineering contracts and the tendencies for delays to occur, completion of projects on time is somewhat unusual in the field of construction in Sri Lanka and has a very poor record in completion of projects on time. Since these delays are such a common feature, it is essential for construction professionals to understand how they should be dealt with in standard building contracts. Proving or justifying delays in time claims are highly conflicted area in construction Industry. This research was targeted to investigate the current extension of time claim management practices followed by the Sri Lankan Construction contractors and their problematic areas. Thereafter to propose recommendations to improve the delay analysis practices and to minimize the disputes in the area of time claim management. Research findings indicate that Contractors fail to gather, analyse and present data as evidence to such an extent that there is a high rejection rate of claims made. It was revealed that 41% of respondents prepare claims without following a proper delay analysis technique. It was also found that 59% of claims are awarded with 50% or lesser satisfaction rate. Subsequently it was disclosed that the main causes for rejection of time extension claims are insufficient supporting documentation and failing to demonstrate of cause and effect of delaying events. Furthermore, it was surprising to note that 43% of the contractors are unaware of any of the basic delay analysis techniques. 83% of the contractors are using project management software to prepare construction programme which is one of the basic tools in proving delays in 50% or more of their contracts. It is also found that 83% of contractors are using computers in more than half of their construction sites enabling computerization of project management activities at construction sites. Under this background recommendations were developed to improve the record keeping at sites, preparing an effective construction programme, effective recording of delay events, issuance of notice for delay events, awareness of delay analysis techniques and to prepare of check list for time extension claims. Finally areas that need further studies were identified.