The nature of construction industry is source of claims and disputes. They have very strong effect on the social and financial benefit of building projects. It means that the stimulation functions of these projects cannot achieve optimal value for economic development strategy of Vietnam. “In Vietnam, regularly, construction projects have met delays and cost overruns” (Long 2008). Although, both contractor and owner know that these claims cannot be avoided or solved at all easily, claims can be managed by preventing and procedures for settling them when they occur. Firstly, claims are result of risks in construction projects. But all risks were not identified and managed by the appropriate methods in order to control them within allowable range to reduce extension time and/or cost overrun of both contractor and client.
Secondly, almost owners in public sector avoid claims by transferring these risks to contractors, designer and consultants. However, claims can be managed and settled claims by owners efficiently. Hence, the influence of claim issues may be mitigated by cooperation of all stakeholders.
Mr. Nguyen Van Tam made a study to find which source of claims are essential and which types of claims have usually occurred in building projects. The objectives of his thesis consisted of three main points: i) identify types and causes of claims in the building project in Vietnam; ii) identify how the claim is settled in terms of analysis for additional cost and/or analysis for extension time; and iii) study claim attitudes of owners and contractors in the building project.
Conclusion
Causes of Claims in Building Projects in Mekong Delta
The case study explored the most significant problems causing claim in terms of delays and/or cost overrun. Factors related to designers, contractors and consultants were rated among the top problems. Delay issues as design changes by mistakes, additional works by owner, and mistakes during construction with 26 vital factors to be inventoried by literature and experts. Cost overrun issues such as design changes by mistakes, price fluctuation, additional works by owner, and unforeseen site condition. The foundation structure changes due to poor or lack of soft soil properties lead increase delay time and cost overrun. There are many owners who can give changes in design document during construction stage.
Claim Settlement in Terms of Additional Cost and/or Extension Time Analysis
There were not clear and fair claim analysis procedures that were written in contract condition or any construction decree or construction law. This was the opportune platform to grow claims. Owners did not force or require contractors to use CPM method in planning, monitoring and controlling the projects. A diary and meeting paper are central tools to notify all events in construction site. Evidently, both parties did not negotiate or discuss to choose a claim analysis method to deal when claims occurred. Although there are major numbers of delay and cost overrun analysis methods, choosing an appropriate analysis method is significant factors to estimate delay time and additional cost in clear and fair way.
Claim Attitudes in Building Projects
Core of claim cultures that were found are distributive attitude and economic order. These attitudes affected very deep in thinking and acting claim events in building projects. However, integrative attitude and occupational order can be observed as cooperation strategy inside project stakeholders. All findings in the study can support to managers and engineers who work in organization level or project level to enrich effect of building projects in public sector in Mekong area or Vietnam scale.
Abstract
Building projects in public sector in Mekong area in Vietnam has been suffered claim impacts heavily. They affect very strong on the social and financial benefit of building projects. In order to increase effect of claim management in building projects, three issues of claims that are causes of claim in terms of delay and/or cost overrun, claim settlement in terms of additional cost and/or extension time and claim attitudes were studied. The study was conducted by case study methodology with data of six building projects in public sector. First finding, the case study explored the most significant problems causing claim in terms of delays and/or cost overrun. Second finding, there were not clear and fair claim analysis procedures that were written in contract condition or any construction decree or construction law. Final finding, core of claim cultures were found are distributive attitude and economic order. These attitudes affected very deep in thinking and acting claim events in building projects. All findings in the study can support to managers and engineers who work in organization level or project level to enrich effect of building projects in public sector in Mekong area or Vietnam scale.
Keywords: Claim, delay, cost overrun, claim attitude, Mekong delta, Vietnam.
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