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ECAM
15,5
456
Received June 2006
Revised July 2007
Accepted October 2007
Engineering, Construction and
Architectural Management
Vol. 15 No. 5, 2008
pp. 456-469
q Emerald Group Publishing Limited
0969-9988
DOI 10.1108/09699980810902749
Claims management in the
Egyptian industrial construction
sector: a contractor’s perspective
Amr A.G. Hassanein and Waleed El Nemr
Construction Engineering, The American University in Cairo, Cairo, Egypt
Abstract
Purpose – This research aims at providing a better insight of the status of claims management in
general, and change order claims in particular, from the contractor’s perspective with respect to the
Egyptian industrial construction sector, as they proved to be the main cause of claims in this sector.
Design/methodology/approach – A questionnaire survey discussing the most persistent issues of
claims management in general, and change order claims in particular, was conducted on a selected
sample of construction industrial companies.
Findings – The results demonstrated that claims management in the Egyptian industrial sector has
been suffering from a variety of obstacles, including lack of proper notification procedures in public
contracts and poor documentation management. Change orders had been actually lost due to poor
documentation. Oral change orders were present in approximately 76 per cent of the projects; half of
which resulted in loss of rights due to improper documentation, which was largely attributed to the
lack of contract awareness of the site team, and to the “fear of consultant phenomenon”.
Practical implications – The paper presented several recommendations for improving claims
management including: the formation of a standard form of contract general conditions for the
Egyptian industrial sector, and applying a methodological approach for change orders quantification.
Originality/value – The increasing number of international companies contemplating construction
projects in Egypt, and the significant problems with regards to claims propagation and management,
addressed the need to conduct such study that targets one of the most challenging areas in the
Egyptian construction industry.
Keywords Construction industry, Egypt
Paper type Research paper
Background
A claim was defined by Hughes and Barber in their reference “Claims in Perspective”
as “a request, demand, application for payment or notification of presumed entitlement
to which the contractor, rightly or wrongly at this stage, considers himself entitled with
respect to an agreement has not yet been reached” (Hughes and Barber, 1992).
A study was conducted on 24 construction projects in Western Canada showed that
the main cause of claims was change orders that accounted for approximately 50
percent of all the claims recorded during the course of the study (Semple et al., 1994).
Other documented causes were: severe weather conditions and acceleration.
A significant number of contractors do not quote a contract clause when preparing a
claim, as stated in various research studies including Jergease and Hartman (1994) and
Vidogah and Ndekugri (1997). This was assumed to stem from their lack of familiarity
with the contract and its relevant clauses.
This paper was published previously in error in Engineering, Construction and Architectural
Management journal, Vol. 15 No. 3, pp. 246-59. The Editors would like to apologize for this mistake.
 Qualification of change orders is an important dimension of claims management Claims
that has been the focus of many research works lately. According to the Conference of management
Claims Management presented by James (1993), it has been proven from various
judicial rulings that a contractor or subcontractor who fails to serve a proper claim
notice would lose his rights. A research by Jergease and Hartman (1994) addressed the
need for proper qualification of change order claims notices by emphasizing the effect
of costs. Subsequent researches supplemented Jergeas and Hartman’s emphasis on the 457
importance of costs (Hanna and Russel, 1998; Hanna et al., 1999a, b).
Zack (1993) introduced several tactics or legal maneuvers that contractors and
owners could use to win claims without actually violating the contract terms.
Reservation of rights approach was among the most important practices discussed.
The industrial sector in particular is one of the areas most susceptible to changes
and claims (Burati, 1992). Heavy industrial projects need adequate time for design.
Hence, execution phases might commence while the design phase is still under way,
leading to incomplete and inaccurate designs (Hanna and Russel, 1998). The result is
an ongoing flood of claims and a project budget and time for completion that are not
met.
Over the years, a significant portion of construction literature has been written on
claims. While the majority of this research was the result of research conducted in
Europe or North America, yet scarce research has been conducted in the Middle East;
despite that the situation in the Middle East is not that much different. However, it has
been reported that, in 2004, construction claims in the United Arab Emirates reached
$4 billion; nearly ten times its reported figure in 1999 (Al Bawaba, 2005). Similarly, a
study aimed at evaluating the causes of delay in Saudi Arabia and the UK concluded
that the magnitude of delays in Saudi Arabia exceeded that of the UK, although the
delay categories were comparable (Falqi, 2004).

Objectives and methodology

This research has two main objectives, namely:
(1) To define the status of claims management in general, and change order claims
management in specific with respect to contractors operating in the Egyptian
industrial construction sector.
(2) To generate means of improving the status of change order claims management
in this sector.

To achieve the objectives of the research, a questionnaire survey was conducted on a

selected sample of industrial construction companies. The questionnaire was
formulated based on an extensive literature review of the most demanding issues on
the topic of claims management in general, and change order claims in specific,
published in reputable construction management journals.
Results obtained from the questionnaire serve to fulfill the first objective. The
second objective is then accomplished through the application of the principles of
claims avoidance and mitigation documented in western construction management
literature to the research findings. The outcome is a practical guide for Egyptian
contractors and owners to overcome claims management problems experienced in the
industrial sector
ECAM Sample selection
15,5 The companies chosen for this research were Egyptian industrial companies with
significant experience in industrial projects that took a contracting role in their
projects. Selected companies were middle to large size whose cumulative industrial
work volume exceeded LE 50 million, and cumulative construction work volume
exceeded LE 100 million. However, since there is a limited number of Egyptian
458 contracting companies that fit those criteria, seven major companies were chosen for
this research. Out of these companies, 21 industrial projects were solicited to constitute
the sample for this research.
Triggered by reduced margins and shifting markets, contractors normally adopt a
claims-conscious attitude and utilize claims as a profit center (Pinnell, 1998). For this
reason, the authors decided to analyze the claims practices of contractors to gain a
deeper insight regarding the nature of claims in the industry.

Questionnaire formulation
As mentioned previously, the questionnaire was formulated based on extensive
literature. It comprised seven questions. Each question was discussed in detail in light
of the literature on which it was based.

Question 1
The claims that occurred in this project can generally be attributed to:
.
Change orders (design changes, extras . . . .).
.
Faulty or late owner-supplied materials and equipment.
.
Inadequate bid information.
.
Poor quality of drawings and specifications.
.
Other.
Question rationale. The above causes of claims were obtained from the research
conducted by (Jergease and Hartman, 1994). The authors listed additional factors, but
the four highlighted were chosen due to their prevalence in the Egyptian industrial
sector. The question provides an indication of the type of claims experienced in heavy
industrial projects.

Question 2
The percentage of change order claims relative to the total claims in the project is:
.
5 percent.
.
10 percent.
.
15 percent.
.
20 percent.
.
50 percent.
. Other.

Question rationale. This question is simply a logical extension of question # 1 as it

serves to highlight the significance of change order claims in relation to other claim
types in the project.
 Comprehensive research on claims by Diekmann and Nelson indicated that 72 Claims
percent of all contract claims originate from change orders (Jergease and Hartman, management
1994). Design errors accounted for nearly 46 percent of these change orders, Burati
(1992). Hence, this question was designed based on Diekmann and Nelson’s theory on
this significant weight of change order claims.

Question 3
459
In this project, what is the percentage of claim notices that were directly tied to a
contract clause?
.
5 percent.
.
10 percent.
.
15 percent.
.
20 percent.
.
50 percent.
.
If other – specify.

Question rationale. The question discussed one of the major parameters of proper
claims management that is qualification of claims. In an article written as a guideline
for engineers entering into arbitration, the authors outlined the importance of proper
contract administration. They specifically addressed the issue of relating every dispute
to the contract stating, “it will be difficult, if not impossible, to prove the merit of a
claim not tied to a contract clause”, Gransberg and Joplin (2000). However, this
important concept of contract management stimulated the need for this question.

Question 4
.
What is the procedure through which the documentation for a claim is handled?
.
Do you believe that there were change orders to which you were entitled but
which you did not obtain due to poor communication?
.
In your opinion, what documentation may have helped improve your records
management in the project?

Question rationale. Seemingly, one of the greatest weaknesses in construction

management in Egypt in general is that of proper records management. This area has
not been given the attention it deserves not only in Egypt, but also elsewhere in the
world. For example, in a research conducted in the UK concerning the reasons for
consultants’ rejection of contractors’ claims, one of the main causes was poor
information systems and documentation practices by contractors (Vidogah and
Ndekugri, 1997). Therefore, due to this imperfection, many research works were
dedicated to finding solutions to the problem. One of the articles strongly addressed the
need for the development of a record management program inside engineering firms
utilizing records management organizations and consultants, Hamilton (1991). After
analyzing this article, the above main question emerged. Its objective was to arrive at
the cycle of a claim documentation process inside a project once a claim issue is
initiated.
ECAM Question 5
15,5 Does the contract in this project stipulate that all change orders must be written?

Question 6
Were there any oral change orders in this project? If yes, how were they handled?
Questions rationale. The above questions were based on the article “Legal aspects of
460 oral change orders” by Thomas et al. (1991). Commonly, there are frequent verbal
instructions on job sites. 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.
A noteworthy point that was brought up by Thomas et al. is that, contrary to common
perception, oral changes can be made valid if certain requirements are met. One ruling
was made by a Supreme Court in the US stated that “oral change modifications are
valid even though there might be specific contract language prohibiting oral changes”,
Thomas et al. (1991). The discussion presented in this article stimulated the need to
investigate the status of oral change orders in the Egyptian industrial sector. Two
areas were examined. The first was to understand the contract’s position regarding
written versus oral change orders. The second was to explore the frequency of oral
change orders occurrence and the means by which these instructions were handled.

Question 7
Is there any agreed-upon basis for quantifying changes that occurred in this project?
Question rationale. This question was based on Fourie’s (1993) approach of change
orders quantification. Fourie presented numerical formulae to calculate changes costs
so that the balance of the parties at the time of tender remains unchanged. Fourie
recommended that both the owner and the contractor must agree on these formulae
prior to the execution of work. The changes costs are divided into: method related
costs; activity duration costs; project duration costs; quantity related costs and change
rate costs. Thus, if Fourie’s logic is applied in any form to the Egyptian industrial
sector, claims and disputes over the cost impacts of contract change orders can be
greatly reduced.

Interviews with respondents

Personal interviews were conducted with engineers or managers of the industrial
companies selected for the purpose of this study. Those respondents primarily handled
claims issues in various industrial projects.
Respondents were chosen in accordance with certain criteria that were influenced
by literature review articles. Although the majority of the articles did not specify the
position and experience of their respondents (they were referred to most of the time as
contractors), some articles portrayed a specific trend. For example, Hanna and Russel
(1998) based their data acquisition on contractors with significant years of successful
experience. Although Thomas et al. (1991) did not address the type of respondents
selected, it was apparent from the content of the articles that the respondents involved
might be engineers with considerable experience in contract administration.
However, in light of the general trend observed in the literature review, the
experience of most interviewees exceeded 15 years in the Egyptian construction sector
(a considerable portion of which was in the industrial sector). The interviewed Claims
personnel also held high positions in the company’s organization. management
A file that contained all the references of the interview questions was made
available during interviews and was presented when necessary to the respondents so
as to emphasize the importance of a research question or for additional clarification.
Interviews lasted more than their scheduled time, simply because the questions
involved significant data-gathering procedures on the part of respondents. 461
Results and analysis
General causes of claims
Figure 1 illustrates that change order claims constitute the majority of claims in the
industrial sector, as they represent approximately 54 percent of the total number of
claims. This result is in direct agreement with the research by Diekmann and Nelson
(1985) that revealed that change order claims form the majority of claims in most
projects (Burati, 1992). This result validates the necessity to further evaluate change
order claims in specific, in order to improve claims management practices. Delays
caused by the owner ranked second. Respondents divided these delays into three
categories:
(1) Delay in supply of material and equipment.
(2) Delay in payments.
(3) Delay in providing construction drawings.

Claims notification status

A major parameter in the evaluation of the status of claims management is the
qualification of change orders. Answers to question 3 demonstrated that nearly 10
percent of the sampled projects stated that notifications were tied to a contract clause
in 0 to 25 percent of instances. This figure was attributed to a variety of reasons. One
respondent stated that notifications were never made in the contracts of public projects
because these contracts were poorly formulated and did not incorporate any
descriptions on claim procedures. In another public project, a respondent stated that

Figure 1.
Causes of claims in the
Egyptian industrial
construction sector
ECAM only 30 percent of the notifications made were tied to a contract clause. Both
15,5 respondents stated that relations with the owner were jeopardized whenever
notifications or documentation for contractual problems were made.
Results revealed that in 67 percent of the projects, notifications were always tied to a
contract clause. However, this percentage may not be regarded as a factual
presentation of the status of notifications, as respondents may have optimistically
462 answered this question so as to not admit a shortcoming on proper claims notification
within their respective organizations.

General claim documentation status

Answers to the main question 4 explain the procedures of claims documentation for all
types of claims and are not limited to change order claims only. Different
documentation procedures are listed and grouped in Table I.
Generally, 62 percent of the sampled projects stated that in most of claim
documentation procedures, work is divided between the office and the site team. No
distinct difference is apparent between groups A and F that together form nearly 60
percent of the documentation procedures. In essence, both groups allocate the task of
claim notification to the site team, who in turn, “hands over” all the contractual work to
the head office team. The only difference between both teams is the timing of claim
settlement. Group A settles each claim as it comes and continues monitoring its
progress during the project execution, while group F compiles and files all claim issues
at the end of the project. The procedure followed by group F, as mentioned previously,
is a “reservation of rights approach” (Zack, 1993). Although this procedure was cited as
a tool for proper claims management, Jergease and Hartman (1994), it has also been
referred to as a tool for making up any losses that were incurred in the project by filing
delay, damage, or disruption claims (Zack, 1993). Hence, the contractor promptly

Group Documentation procedures %

A Site generates notification and office follows up contractually. Claims matters

are Filled in one project file divided by separators. This procedure is followed
when the project is small and does not have an on site management team 33.33
B Changes were collected then circulated and signed on site (sometimes signed in
minutes) 4.76
C Using the program “expedition”, claim cases and correspondences were
grouped and filed to be used for future reference 4.76
D Site team presents claim documents to head office. Negotiations take place
between site and the head office. Agreements are made on course of action to be
taken. Head office takes decisions and then site continues filing the claim 4.76
E Documentation procedures are as dictated and specified in contract 4.76
F Site initiates claim through notification and variation order, then claim is taken
to the head office. Office analyses claims impact on time and cost and claims
are filed at office to be settled at the end of the project 28.57
Table I. G Site handles claim completely and claim issues are filed among
Claims documentation correspondences in various files 19.1
procedures 100
reserves his rights to claim and presents a detailed account of the claim only at the end Claims
of the project, where he can take advantage of any losses and delays and incorporate management
them in his claim.
Approximately 29 percent of the sample projects applied that form of claims
management. One reason for this late settlement of claims is a cultural one, as it was
reported that Egyptian owners felt offended whenever contractual notifications or
reservation of rights were made by Egyptian contractors. As a result, the contractor in 463
turn, fearful of bruising relations with the owner, either stops making these
notifications and reservations thereby waiving his right to pursue these claims, or
reserves his rights and saves settlement of these issues until the end of the project.
Results demonstrated clearly that most of the projects had no special means of
organizing and filing claim matters. Claim matters were filed in one file along with
other project correspondences. This was a crucial point as it confirmed the lack of
proper documentation in the industry. The only exception is that of group C, in which
the respondent managed and tracked claims issues through the use of project
management software “Expedition”, in addition to the hard copy for further claim
support. When asked if there were any problems during the settlement of the claim, the
engineer answered that the consultant could hardly turn down a claim issue because of
the adequate and ready presentation of claims support.

Change order documentation

The results indicated that the majority of the sampled projects (57 percent) stated that
change orders had been actually lost due to poor documentation practices. However,
this result was anticipated since the Egyptian construction industry has been suffering
from the problem of inadequate documentation practices.
Figure 2 illustrates documentation procedures that respondents believed to improve
claims management
As evident in the above figure, 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. Many respondents stated that the

Figure 2.
Documentation that could
improve records
management of the project
ECAM absence of these reports have caused the head office team to lose contact with the
15,5 events that happen on site, and accordingly, were unable to handle claim situations.
Equally important to the site daily records, is the contractual awareness of the site
team. The lack of contract awareness by the project’s site team has been recognized in
numerous published literature, such as that of Vidogah and Ndekugri (1997) and
Jergease and Hartman (1994). In Egypt, the situation is no different. During the course
464 of this study, numerous cases had been reported of site engineers who received direct
instructions from the owner’s representative or consultant and the result was
additional incurred expenses as a result of poor or inadequate supporting
documentation. Therefore, this research 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.
One of the solutions offered is that the head office should develop a contract
checklist that contains all the required contractual administrative requirements, and
send this checklist to the site to be filled out with the daily report. Such a checklist
would ensure that important contractual information would be delivered to the head
office and that would force the site team to consider contractual implications when
facing daily issues on site.
One significant result from this research was what was termed as “fear of consultant
(or owner) phenomenon”. Nearly 33 percent of the projects exemplified this phenomenon.
Several respondents stated that they waived some of 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. Therefore, written timely
notices, documented minutes of meetings, written confirmations of oral changes would
not be implemented purposely by Egyptian contractors in light of the adversarial impact
such practices would have on their business relations with the owner.

Oral change orders

Regarding question 5, respondents in all the sampled projects stated that their
contracts did not recognize oral change orders. This is an indication that – contrary to
rulings made in US Court favoring oral change orders, as documented by Thomas et al.
(1991) in his article “Legal aspects of oral change orders” oral changes, unless
confirmed in writing, may bar an Egyptian contractor from the recovery of associated
costs. However, this conclusion is relevant not only in the Egyptian industry, but also
elsewhere in the world, as the prevailing attitude is that oral change orders have no
contractual weight.
Concerning question 6, the results clearly demonstrated that oral change orders
have been frequently present in nearly 76 percent of the sampled projects. Half of these
oral change orders resulted in loss of rights due to improper documentation practices.

Change order quantification

The responses obtained concerning the last question were all indicative that there was
no agreed upon method for the quantification of change order claims at contract
formation, such as that presented by Fourie (1993). However, it is the author’s opinion
that Fourie’s systematic presentation of equations by which rates are adjusted to
maintain the balance among all parties could reduce significant tensions between
contractors and owners and could ultimately facilitate the claims evaluation process.
Problem areas summary Claims
In light of the above results and analyses, the Egyptian industrial construction sector is management
characterized by the following impediments to proper claims and change order
management:
.
Effective delays caused by the owner.
.
Deficient contracts of the public sector.
465
.
Claim documentation and filing procedures.
.
Lack of contract awareness by the site team.
.
“Fear of the consultant” phenomenon.
.
Oral change orders from the owner.
.
Lack of a unified system for the quantification of change orders.

Suggested solutions
Solutions are proposed based on the nature of the problem and the documented
solutions for improvement.

Float-sharing and “banking” provisions

As discussed above, effective delays caused by the owner ranked second among the
most frequent causes of claims in the industrial sector. One solution to this problem
focuses on the principle of float-sharing between the owner and contractor. Several
research studies demonstrated that float ownership is a controversial topic. In his
article on “claimsmanship”, Zack (1993) presented the arguments from both the owner
and the contractor’s viewpoints and used them as a form of claimsmanship that can be
used by each party against the other. The contractor would argue that he is entitled to
the restoration of the float of an activity that has been affected by an owner-caused
delay. On the other hand, owners might argue that the float is the sole property of the
owner and the contractor is not entitled to any float restoration, even in the event of an
owner-caused delay. Zack proposed that a joint-float-ownership clause be included in
the contract. In this case, both parties can come to an agreement with regards to the
effect of a certain owner-caused delay on the contractor’s work progress with
consideration to the shared float. Implementing Zack’s idea of a joint-float-ownership
clause in future contracts is a start to help alleviate, or at least mitigate, contractor
claims in relation to owner-caused delays.

Standard form of contract general conditions

One of the most effective solutions to proper change order claims management
practices in the Egyptian construction industry as a whole, and in the industrial sector
in particular, is the alteration of the norms governing claims notification and
documentation practices in this sector. As shown in this research, a cultural factor has
been identified as a possible cause for the lack of notification and documentation in this
sector, namely the “fear of consultant phenomenon”. Egyptian owners (especially
public) and consultants must rid themselves of their feeling of offense whenever a
change notification is made, or minutes of meeting is objectively documented, or a
correspondence is made to address an issue attributable to the owner. Therefore, there
is a pressing need to overcome these obstacles through adherence to fundamental
ECAM principles of contract administration. One solution is the formation of standard
15,5 contract conditions that can be used in the industry (along the same line of FIDIC
contracts for international projects) that contain explicit clauses governing proper
documentation practices. 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
466 stated that the party at fault must waive its right regarding the matter in request.
Clauses regarding the owner’s responsibilities should be enhanced. Only written
instructions to contractors are permissible. In case of necessity for a verbal instruction
on the job site, it is the owner’s role to confirm within a stipulated number of days.
Otherwise, the contractor is not contractually required to carry out the works.
The essence is that these standard conditions would be tailored to suit the Egyptian
industrial sector. However, in order for such conditions to be effective, they must be
reinforced through a professional engineering entity having jurisdiction. Such
reinforcement would help guide the Egyptian industry to adopt an objective,
systematic approach with regards to proper claims notification and documentation.
Unified general conditions can also help improve the following problem areas:
.
oral change orders from the owner;
.
deficient contracts of the public sector;
.
fear of consultant phenomenon; and
.
Egyptian and custom-made contract conditions.

Enhancement of claims documentation and filing procedures

One of the simplest, yet effective ways of filing claim matters has been addressed in the
research of Thomas et al. (1991) and Jergease and Hartman (1994), where each claim
matter would be filed separately with the associated correspondence, drawings,
specifications and cost estimates. A records management program, on the other hand,
might be a useful means to implement adequate control over the records in the entire
organization, and not just claims (Hamilton, 1991).
Another form of records 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 and
Ndekugri, 1997). This can be very beneficial in the process of pricing a certain claim
that involves the input of various departments within the organization. Furthermore, it
provides an easy access to different claim subjects.
Although implementing information technology systems in Egyptian contracting
companies may be viewed by many managers as being costly and therefore not
necessary, it can prove to be invaluable when significant losses as a result of poorly
documented claims are prevented. As mentioned previously, 57 percent of the sampled
projects indicated that change orders had been lost due to poor documentation.

Contract awareness by site team

An obvious solution to this problem is that the site team must be aware of what is in
the contract documents. One way for accomplishing this objective is through
conducting periodical orientations to the field personnel performed by the company’s
contracting department. Such orientations would be treated as very important and as Claims
pre-requisites for annual raises or bonuses. management
Another solution could be the formulation of a checklist by the site team or the
company’s contracting department, such as the one suggested by Jergease and
Hartman (1994). This checklist would incorporate everything in the contract of a notice
nature.
467
Unified quantification of change orders
The responses to the question of whether there existed an agreed-on basis for
quantifying change order claims were unanimous, in the sense that no one used such a
system. It is the author’s opinion that implementing the quantification method outlined
in Fourie’s (1993) article “Quantifying Costs due to change” would be an important
improvement in change order claims management. As outlined previously, Fourie
categorized change order costs into several categories. All these costs are then broken
down into equations so as to provide a general framework for future and general use.
Further, these equations should be approved by the owner at the beginning of the
project to facilitate the process of claims notification later on.
Although Fourie presented these equations to modify existing contract rates so that
the balance between the contracting parties at contract formation is maintained, the
concept of implementing such equations provides a risk-sharing scheme that may
prove favorable to contractors and owners. The result may be reduced disputes and
claims over change order pricing.
Another form of change order claim quantification was outlined by Veenendal
(1998). The author suggested tracking the effect of each change order on the project
schedule. This procedure permits quantification of change orders in terms of time and
money.

Conclusions
As outlined previously, this research aims at fulfilling two main objectives. Concerning
the first objective, the following is concluded:
.
The most common types of claims have been documented as change orders and
delays caused by the owner (contributing to 54 and 25 percent respectively of the
projects sampled).
.
Regarding claims qualification, 67 percent of the sampled projects stated that
they used contract-clause notifications all the time. As for claims documentation
procedures, in nearly 62 percent of the projects, the site team was the initiator of
claims matter.
.
A total of 57 percent of the sampled projects indicated that change orders had
been lost due to poor documentation practices. Respondents reported several
documentation procedures for improving records management status. A
majority (76 percent) of the projects experienced oral change orders, of which
50 percent stated that their entitlements were lost due to the improper
documentation practices, which were in turn linked to the lack of contract
awareness of the site team and fear of consultant phenomenon.
ECAM Concerning the second objective, the research addressed the following
15,5 recommendations for the enhancement of claims management in the Egyptian
industrial construction sector:
.
The inclusion of float-sharing provisions in the contracts as a means of
mitigating impacts of owner-caused delays.
.
The formation of standard conditions of contract tailored for the Egyptian
468 industrial sector to enforce standard contract administration practices, such as
written instructions, timely notifications and adequate record keeping and
documentation.
.
The improvement of claims documentation and filing procedures through the
introduction of claims/change orders filing systems and the utilization of
electronic document management systems within organizations.
. The education of the contractor’s site team of fundamental contract principles, so
that the contract representative becomes aware of his company’s obligations
vis-à-vis the owner and consultant, and be cognizant of his scope of work under
the contract
.
The use of standard equations at contract formation to be applied for the
quantification of change orders during the project execution phase as a means to
resolve and mitigate disputes over change order pricing.

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Corresponding author
Amr A.G. Hassanein can be contacted at: mail@finbi.com

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