CM 4210 Quiz 1

What is a Design Build contract? A. A contract method that addresses design and construction costs simultaneously B. A contract method that bids after design C. A contract method that uses fast-tracking incentives as the basis of the contract

A contract method that addresses design and construction costs simultaneously

What is a lump-sum contract? A. A contract that includes a set price and fee for all services provided, including all labor and materials B. The total fee and price that includes all the risk and unforeseen conditional cost that is unknown C. The unit prices per unit, which may include materials, labor, overhead, supplies, and profit

A contract that includes a set price and fee for all services provided, including all labor and materials

Select the best definition for labor and materials. A. A contractor who is responsible for procuring the materials, as well as any costs associated with the labor and materials needed to complete the work B. Specific to only construction and small business contracts C. Only used in State and not Federal Contracting language

A contractor who is responsible for procuring the materials, as well as any costs associated with the labor and materials needed to complete the work

What is a Design Bid Build contract? A. A traditional construction project delivery method that involves the completion of three distinct phases in sequence B. The process that saves the owner time and money by combining the design and construction C. The maximum price the owner is to pay the vendors for materials and equipment D. All of these answers

A traditional construction project delivery method that involves the completion of three distinct phases in sequence

The GMP will include which of the following. Select all that apply. A. Labor and materials B. Overhead and profit C. Fees and percentages to make a profit D. All of these answers

All of these answers

The advantages of Time and Material contracts consist of which of the following. Select all that apply. A. Helps budget overall costs B. Reduce risk to Prime Contractor of fluctuating material and labor cost C. Reduces cost-cutting methods by the owner D. Incurs a known profit to the Prime Contractor E. All of these answers

All of these answers

What are examples of an incentive construction contract? A. Fast tracking B. Safety awards C. Zero quality defects D. All of these answers

All of these answers

What are examples of construction contract clauses for escalation? A. Steel B. Fuel and gas C. Construction materials and equipment D. All of these answers

All of these answers

What are examples of contract documents? A. Blueprints B. Design drawings C. Scope of Work D. Technical specifications E. All of these answers

All of these answers

Timeline is defined by which of the following. Select all that apply. A. Start Date B. Finish Date C. Both

Both

A strong construction contract will outline the project's scope and leave little to no room for which of the following. A. Additional addendums B. Red-line drawings C. Confusion on either side

Confusion on either side

Details for payment terms are defined by which of the following. Select all that apply. A. Prime Contractor B. Owner C. Contract

Contract

Negotiating a contract with no compromise can affect which of the following. A. Delay the start date B. Delay payment C. Delay award banquet and ceremony

Delay the start date

Select the best definition for change request. A. Describes how any requested changes will be communicated to the general contractor, as well as any fees required for change orders and timelines for when changes can be requested and handled B. A request for additional work C. A request for better working conditions and pay

Describes how any requested changes will be communicated to the general contractor, as well as any fees required for change orders and timelines for when changes can be requested and handled

What is a Unit Price contract? A. Details prices per unit, which may include materials, labor, overhead, supplies, and profit B. Details the maximum price the owner is to pay the subcontractor C. Details the maximum amount the owner will have to pay the contractor is capped and is not to exceed D. All of these answers

Details prices per unit, which may include materials, labor, overhead, supplies, and profit

A construction contract must be in writing. True False

False

A variation-in-quantities clause is for lump sum projects. True False

False

An offer is a conditional willingness to enter into an agreement. True False

False

Comparative negligence can totally prevent an injured person from winning a case. True False

False

Contract liability does not include a breach of an implied provision. True False

False

Duress will never void a contract. True False

False

During construction, the owner's representative has the authority to deviate from the contract requirements. True False

False

It is okay for a contractor to assume design liability in any construction contract. True False

False

Liability always falls into just one of the main categories. True False

False

Physical conditions reports do not include soil reports. True False

False

Safety awards for no injuries, fast-tracking, and zero quality defects are examples of incentives in a unit price contract. True False

False

The owner determines the means, methods, techniques, sequences, and procedures of the construction (unless the contract provides otherwise). True False

False

Threshold red flag clauses should be examined when the estimate is complete. True False

False

Of the three contracts LS, LSTK, and GMP, which once affords the most protection financially and allows the owner to secure investors and loans? A. GMP B. LSTK C. LS D. All of the answers

GMP

What is the next step in the construction contract process after the contract has been drafted and reviewed by all parties? A. Sign and Date B. Edit and formatting C. Negotiations

Negotiations

A construction contract is an agreement that is between the OWNER and which of the following. A. Subcontractor B. Supplier C. Prime/General Contractor

Prime/General Contractor

Who is responsible for selecting and managing the sub-contractor on a project? A. Owner Rep B. Subcontractor Executive Management C. Prime/General Contractor

Prime/General Contractor

What is a Time and Materials contract? A. Requires the client to pay the contractor for all labor and materials at a pre-negotiated rate B. States the maximum price the owner is to pay the subcontractor C. States the maximum price the owner is to pay the vendors for materials and equipment

Requires the client to pay the contractor for all labor and materials at a pre-negotiated rate

The construction contract will specify contract details such as which of the following. A. Scope of Work B. Special tools C. Vendors

Scope of work

What is the best definition of dispute resolution? A. The acceptable methods for resolving any disputes that may arise before, during, or after the construction process, such as arbitration, adjudication, or mediation B. The method of resolving disagreements through a panel of board members C. The method of meeting with a therapist to discuss one's feelings that were hurt in a dispute

The acceptable methods for resolving any disputes that may arise before, during, or after the construction process, such as arbitration, adjudication, or mediation

Select the best definition for General Contractor. A. The company or individual responsible for overseeing the construction process and managing any subcontractors, if applicable B. The Company that tells everyone on the project how and when to perform C. The Company that performs the Front-End Loading and Engineering design

The company or individual responsible for overseeing the construction process and managing any subcontractors, if applicable

The right to subcontract any project work has to be outlined by which of the following. Select all that apply. A. The contract B. The Owner C. The Prime Contractor

The contract

Select the best definition for Owner. A. The individual or company hiring the general contractor and entering into the contract to have construction work done B. The group of investors that form an LLC C. The company that supplies the materials and equipment for the project

The individual or company hiring the general contractor and entering into the contract to have construction work done

Scope of Work is a description of which of the following. Select all that apply. A. What work is to be installed and constructed in the design documents before approval B. The bolts and gaskets that will be installed C. The list of construction obligations, as well as work activities that all contractors, subcontractors, and suppliers are obligated to do

The list of construction obligations, as well as work activities that all contractors, subcontractors, and suppliers are obligated to do

What is a Guaranteed Maximum Price contract? A. The maximum amount the owner will have to pay the contractor is capped and is not to exceed B. The maximum price the owner is to pay the subcontractor C. The maximum price the owner is to pay the vendors for materials and equipment

The maximum amount the owner will have to pay the contractor is capped and is not to exceed

What does Indemnification mean? A. The responsibility of the contractor for any damages or loss incurred by the owner due to the work of the contractor B. Holds the owner responsible for any injuries after the project is over C. Legal term to hold the owner responsible for Prime Contractor negligence

The responsibility of the contractor for any damages or loss incurred by the owner due to the work of the contractor

"Fast track" is when the contractor can start building part of the project while other parts are still being designed. True False

True

A contract must have a legal purpose to be enforceable. True False

True

A cost-plus contract is looked upon as a favorable contract by Contractors. True False

True

An advertisement should describe what the project is and where it is. True False

True

An advertisement would be part of the bid documents. True False

True

Apparent authority is when the owner acts in such a way that the contractor believes the owner's representative had authority beyond the express authority. True False

True

Courts are not inclined to enforce such exculpatory clauses unless they are prominent, non-ambiguous, and do not conflict with other contract provisions. True False

True

Implied authority is not in the contract documents, but is needed to carry out the actual authority. True False

True

In a cost-reimbursable contract, the contractor is reimbursed for their costs and also receives a fee. True False

True

In the Hertz case, Boh Brothers was found liable even though it had "under construction" signs displayed. True False

True

Instructions to bidders add information to the content put in the advertisement? True False

True

Multiple prime contracts must be written carefully to create third-party beneficiary relationships among all of the separate prime contractors. True False

True

Specifications are the technical requirements of the specific project. True False

True

T&M contracts can lead to many disputes on pricing. True False

True

The "E" in A/E stands for "engineer." True False

True

The Prime Contractor can terminate its contract when the owner is in breach of contract or acting in bad faith. True False

True

The advantage of cost plus is that the Prime Contractor will incur a profit. True False

True

The changes clause is one of the threshold red flag clauses. True False

True

The contract may give the owner the unilateral right to suspend the project. True False

True

The drawback of design build is that the price may be higher for the owner. True False

True

The general public is an interested entity in a construction project. True False

True

The owner can specify in the contract how and what subcontractors can be sourced for the project. True False

True

The owner can terminate a contract for cause and breach of contract anytime it has evidentiary proof to do so. True False

True

The owner may have a prime contract with a bank on a construction project True False

True

There is no difference between lump sum and fixed price. True False

True

You can have a multiple-contract method under one project. True False

True

What does contract termination mean? A. When either party can legally terminate the contract and any penalties that may apply to the decision to terminate B. When both parties walk away due to not liking each other or one party has made bad claims against the other C. When both parties decide to divorce one another from future project participation

When either party can legally terminate the contract and any penalties that may apply to the decision to terminate

Does a lump sum turnkey have better protections than a normal lump sum contract? A. Yes B. No C. Not applicable

Yes