Management of change order claims in the Egyptian industrial construction sector: analysis and means of improvement

The term claim has become a word of paramount significance on construction projects worldwide. Throughout .the past decade, several research works in Europe and North America have been dedicated to exploring the causes of claims and solutions that would help minimize their occurrence and possibly prevent them. This research is the first of its kind in Egypt, as it attempts to help gain a deeper insight of the status of claims management from the contractors perspective with respect to the Egyptian industrial construction sector. Special attention is given to change order claims, as this research demonstrates them as a major cause of claims in this sector. By the end of the research, strategies for improvement of change order claims management, and hence claims management in general, would be furnished. Claims management in the Egyptian industrial construction sector has been proven to suffer from a variety of pitfalls, including lack of proper notification procedures in public contracts and poor documentation management. This lack of proper documentation management has led over 50% of the sample projects to not obtain change orders, to which they assumed they were entitled. Nearly 30% of the sample projects within this research stated that site personnel must be fully aware of all contractual requirements in order for documentation in the Egyptian industrial sector to be improved. Moreover, the basic cause of change order claims has been documented by nearly 70% of the sample projects to be additional scope of work, which can be attributed to the simultaneous progress of the design and construction works in such a fast track sector. This simultaneous progress results in the owner awarding the contractor additional work during project execution that was not conceived at the beginning of the project prior to contract award. One ofthe most important conclusions of this research is that it was reported that many Egyptian owners and designers were offended from prompt claim notification and documentation procedures on part ofthe contractor. Suggested means for improvement include addressing the issue ofthe owners\u27 offense from prompt claim notifications by the formation of a unified form of conditions for the Egyptian industrial sector. It is suggested that this form of conditions would be enforced by a professional engineering organization of significant authority and jurisdiction within Egypt. Another suggested means of improvement addresses owner-caused delays and suggests that the owner and contractor both share the float associated with the delayed activity through a float-sharing provision in the contract. Finally, the use of information technology systems instead of traditional filing procedures has been suggested as means to improving documentation practices within the sector

The enforceability of time bar clauses in construction contracts : a comparative analysis between the Egyptian civil code and the English and Welsh common law jurisdictions

Construction claims are a fact of life on all projects across the world. In an attempt to safeguard themselves against the risk of claims, employers utilise time bar clauses in construction contracts to waive the contractor’s entitlement to any additional costs or time if a notice of claim is not served by the contractor within a specific period of time. The reality of whether such a time bar is enforceable depends on the law governing the contract. Therefore, it is incumbent upon professionals contracting across different regions of the world and using standard form construction contracts that were prepared under a different jurisdictional setting than their own to be aware and acquainted with the extent to which these time bar clauses are enforceable under the law governing the contract in question. This research provides an in-depth insight regarding the enforceability of time bar clauses in English law and the Civil Code jurisdiction of Egypt, using the time bar in sub-clause 20.1 of the FIDIC 1999 Red Book as the basis for comparison. The results of this research do not solely apply to the time bar clause in the FIDIC 1999 Red Book, but also to any time bar clause in a bespoke form of contract that acts as a condition precedent. The need for this research and its uniqueness stem from the fact that it aims to fill a critical gap in the construction law literature as, while there is an abundance of literature on the enforceability of time bar clauses under English law, there is scarcely any sizeable research dedicated to the same topic under the Egyptian Civil Code. The research utilises a comparative law methodology to compare the enforceability of the FIDIC time bar across the two jurisdictions utilising three key concepts as the basis for comparison, namely statutory limitation, good faith and the prevention principle. As part of this methodology, the research takes a step beyond the subject of the research and delves into the historical origin of the similarities and differences highlighted. In doing so, the research concludes with two key premises for the causes of the similarities and differences highlighted in the research, namely the principle of freedom of contract under English law and the effect of the French Civil Code on the formation of the Egyptian Civil Code. This, in turn, results in historical elaborations of both premises

Change Orders after the Contract Completion Date and Contractual Defects in the longest Path Theory

A contentious point of discussion between forensic schedule delay analysts and contracts practitioners is the means by which the critical path is determined in a project delay situation after the lapse of the contract completion date. One school of thought is called the negative float theory (the contracts practitioner\u27s preference), in which the critical path is determined with reference to the contract completion date. Under this theory, any work performed after the contract completion date is considered critical. The second is called the longest path theory, in which the critical path is the longest critical path up to the forecast completion date. Therefore, only the delay to activities on the longest path is considered critical, even if another delay takes place after the contract completion date. The distinction between the two theories is exemplified in a situation in which a change order or an owner-caused delay takes place after the contract completion date when the contractor was already in delay. An examination of the literature and case law demonstrates that the longest path theory has wider application and preference in the United States and abroad. This paper goes against the tide and illustrates, from a contracts practitioner\u27s standpoint, that there are challenges to the application of the longest path theory. Several contractual and practical (from a contract management perspective) factors are elaborated upon to prove this point, and recommendations are provided in conclusion. The objectives of this paper are (1) to present, from a contract practitioner\u27s viewpoint (as opposed to the common forensic planner\u27s viewpoint), critical contractual flaws in the application of liquidated damages using the longest path theory when owner delays are encountered by a contractor after the lapse of the contract completion date; (2) to make recommendations as to how to alleviate these contractual flaws; and (3) to stimulate intellectual discourse and provoke thought on this much-debated topic of changes taking place after the contract completion date and the application of liquidated damages in this situation