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The aim of this study is to focus on the practice and implementation of prolongation cost claim, liquidated damage and extension of time in public building construction projects in relation to legal and contractual regulations currently implemented in building construction contracts in Bahir Dar University Building Construction Projects. A thorough literature review was conducted to study and identify issues related to prolongation cost claim, liquidated damage and extension of time that are important for designing the methodology and closed ended questionnaire together with documentation review developed as a primary strategy for data collection methods. Fifty four respondents’ were selected for this study Samples for this study comprised of professionals working in Bahir Dar University (public employer), consultants and contractors who are actively participating in Bahir Dar University Building Construction Projects. From 50 questionnaires distributed a total of 45 responses were collected with a return rate of 90%, a descriptive statistical method by using SPSS 21, Relative Importance Index and correlation coefficient were used for the analysis of the data collected through questionnaire survey. The questionnaire respondents stated, the major reasons for project delay that could justify extension of time were ranked late instructions or drawing, delay in giving possession of site and exceptionally inclement weather respectively. In case-studies, the main reasons for project delay that could justify extension of time were ranked late instructions or drawing, late possession of site and additional works respectively. The damages related to prolongation cost claim are extended and increased site costs (site overheads or preliminaries), head office overhead cost, inefficiency/ lost productivity cost, financial charges and interest, inflation, loss of profit/ opportunity cost and claim preparation costs. Liquidated damage clause is the common mechanism used in Bahir Dar University building projects to compensate the Owner for losses caused by delays that are the fault of the contractor. |
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