ARE 5.0 - CE

labor and material payment bond

A bond guaranteeing to the owner that the contractor will pay for all labor and materials used for the project.

completion bond

A bond obtained by the contractor or owner, which guarantees that the project will be completed free of liens.

performance bond

A bond that guarantees to the owner that the contractor will perform the work in accordance with the contract documents.

option

A choice given to the contractor to provide specified alternates without prior approval of the architect.

mechanic's lien

A claim on property by those who furnish material or labor for theconstruction of a building. Clear title to the property cannot be obtained until the claim is settled.

fast-track construction

A construction technique by which construction on each element of a project is begun as soon as the design for that element is completed, without waiting for completion of the design for the entire project. Its principal objective is to shorten the overall construction time.

single prime contract

A contract for building construction under which one prime contractor is responsible for the entire project, in contrast to having separate contracts. See separate prime contract.

Indemnification

A contractual obligation whereby one party agrees to guarantee another party against loss or damage from specified liabilities.

hold harmless clause

A contractual obligation whereby one party agrees to guarantee another party against loss or damage from specified liabilities.

deposit for bidding documents

A deposit of money required of each bidder as security for the bidding documents, to ensure the return of the documents by unsuccessful bidders.

waiver of lien

A document by which one relinquishes the right of mechanic's lien against the property of another. See mechanic's lien and release of lien.

certificate of occupancy

A document issued by the governing authority stating that a building complies with applicable laws and permitting occupanch for its designated use.

certificate of substantial completion

A document prepared by the architect stating that the work is substantially complete, thereby establishing the date of substantial completion. It generally fixes the time within which the contractor must complete the unfinished work listed.

construction change directive

A document, signed by the owner and the architect, which authorizes a change in the work, the contract sum, or the contract time. Used when there is not complete agreement on the terms of a change order.

Davis-Bacon Act

A federal law that requires the Department of Labor to set prevailing wages for government-financed construction projects.

Estimate

A forecast of probable costs, as opposed to a firm bid.

warranty

A guarantee.

release of lien

A legal document signed by a supplier of material or labor for a project, which releases his or her mechanic's lien against the property.

guarantee

A legally enforceable assurance of the quality of materials and labor furnished for a project, or of the length of time that a project or a part thereof will perform satisfactorily. Also called Warranty.

express warranty

A legally enforceable promise made by the warrantor.

letter of intent

A letter signifying intention to enter into a formal agreement and setting forth the general terms thereof.

punch list

A list of items to be corrected or completed, which is provided by the contractor and usually expanded by the architect based on a detiled inspection of the work prior to substantial completion.

vapor barrier

A membrane that prevents the passage of water vapor through a wall or roof.

critical path Method ( CPM)

A project management procedure in which all events and operations are charted in a way that establishes the optimum sequence and duration of operations.

bid

A proposal by a contractor to do the work required by the contract documents for a stipulated sum of money

bonus and penalty clause

A provision in the construction contract for payment of a bonus to the contractor for completing the project prior to a specific date, and for a charge (penalty) against the contractor for failing to complete the project by that date.

submittal

A shop drawing, project data, or sample submitted by the contractor to the architect for review prior to incorporation in the work.

certificate for payment

A statement by the architect informing the owner of the amount due the contractor on account of work completed and/or materials suitably stored.

schedule of values

A statement furnished to the architect by the contractor reflecting the amounts to be allotted for the principal divisions of the work. It serves as a guide for reviewing the contractor's periodic applications for payment.

liquidated damages

A sum chargeable against the contractor as reimbursement for damages suffered by the owner because of the contractor's failure to complete the work within a specified time.

bid bond

A surety bond guaranteeing that the bidder will sign a contract, if offered, in accordance with his or her proposal.

CSI MasterFormat

A systematic listing of construction trades, materials, systems, and administrative requirements published by the Construction Specifications Institute (CSI) for the purpose of organizing construction specifications.

observation

A term sometimes used for on-site examination of the contractor's work by the architect to determine in general if it is proceeding in accordance with the contract documents.

sick building syndrome

A term used to describe poor indoor air quality, which can lead to discomfort and possibly disease.

change order

A written order to the contractor, prepared by the architect and signed by the owner, contractor, and architect, which authorizes a change in the work, the contract sum, or the contract time.

program

A written statement of the owner's conditions and requirements for the project.

post-completion services

Additional services rendered to the owner by the architect following actual completion of the project.

work

All materials and/or labor required for a project.

multiple of direct personnel expense agreement

An agreement providing for payment for professional services based upon the direct personnel expense multiplied by an agreed factor.

surety bond

An agreement under which one party (the surety or bonding company) guarantees to make good to another party (the obligee or owner) the debt, default, or failure to perform of a third party (the principal or contractor).

lump sum contract

An agreement under which the architect or contractor is paid a specific amount as the total fee for services performed.

stipulated sum contract

An agreement under which the architect or contractor is paid a specific amount as the total fee for services performed.

cost plus fee contract

An agreement under which the contractor, or the architect, is reimbursed for his or her costs and, in addition, is paid a fee for his or her services.

arbitration

An alternative to litigating a dispute, in which one or more arbitrators hears the evidence and renders a decision.

addition (to the contract sum)

An amount added to the contract sum either by an accepted additive alternate or by change order.

cash allowance

An amount included in the contract sum to cover the cost of certain items not specified in detail. Hardware and other finish items are often handled in this manner.

contingency

An amount of money set aside in a budget to cover unanticipated expenses.

retainage

An amount withheld from each payment to the contractor in accordance with the terms of the owner-contractor agreement.

unit price

An amount, stated in dollars per unit, provided by the contractor with his or her bid for adding or deleting specific portions of the work.

Total Quality Management (TQM)

An approach to the delivery of goods or services in which quality is determined by customer satisfaction and conformance to requirements.

consultant

An engineer or other specialist retained by the architect to provide specified professional services to the archtect that the architect is required to provide to the owner under the owner-architect agreement.

surety

An individual or company that guarantees to make good to another party the debt, default, or failure to perform of a third party.

invitation to bid

An invitation to a selected list of contractors soliciting bids for a project.

extra

An item of work involving additional cost.

statute of limitations

An ordinance that specifies the period of time within which legal action must be brought in order to obtain legal relief for damage or injury.

percentage agreement

An owner-architect agreement under which the professional fee is based upon a percentage of the construction cost of the project.

prime contractor

Any contractor on a project who has a contract directly with the owner.

substantial completion

As defined in the AIA General Conditions, completion of a project to the point where the owner can occupy all or designated portions of the work for the purpose for which it is intended.

incentive clause

Clause in a cost plus fee contract between the owner and contractor in which the savings between the guaranteed maximum cost and the actual project cost are proportionally shared.

application for payment

Contractor's written request for payment of amount due on account of work completed and/or materials suitably stored on the site. Also called payment request.

insurance

Coverage by contract (insurance policy), whereby one party (the insurance company) agrees to indemnify or reimburse another (the insured) against loss from a specified hazard. See liability insurance and professional liability insurance.

supervision

Direction of the work by the contractor's personnel. Supervision is not the responsibility of the architect.

shop drawings

Drawings prepared by contractor, subcontractor, manufacturer, or supplier, showing how specific portions of the work shall be fabricated and/or installed.

record drawings

Drawings revised to show changes made during construction. Sometimes erroneously called As-Built Drawings.

direct expense

Expense items directly incurred by, or attributable to, a specific project.

americans with disabilities Act (ADA)

Federal civil rights legislation that establishes the right of persons with disabilities to equal access to sites and buildings, and sets design guidelines for its implementation.

instructions to bidders

Instructions in the bidding documents for preparing and submiting bids for a project.

notice to bidders

Instructions in the bidding documents for preparing and submiting bids for a project.

errors and omissions insurance

Insurance that financially protects an architect against claims for damages resulting from professional negligence.

professional liability insurance

Insurance that financially protects an architect against claims for damages resulting from professional negligence.

liability insurance

Insurance that financially protects the insured against liability on account of bodily injury or property damage sustained by another.

construction management (CM)

Management services performed by the architect or others, over and above normal architectural services, that contribute to the control of time and cost in the construction of a project.

sample

Material or assembly submitted for the architect's approval prior to manufacture or delivery to the project.

approved equal

Material or method that is approved by the architect as being equivalent to what was originally specified.

separate prime contract

One of several owner-contractor agreements for a project, each of which provides for constructing a major portion of the work (general construction, electrical, mechanical, etc.) by a different contractor.

agent

One who acts on behalf of another.

subcontractor

One who has a contract with a prime contractor to perform a portion of the work.

indirect expense

Overhead expense, that is, expenses indirectly incurred and not chargeable to a specific project.

specifications

Part of the contract documents, comprising written descriptions of materials, construction systems, and workmanship.

special conditions

Part of the contract documents, other than general and supplementary conditions, describing unique conditions of a project.

supplementary conditions

Part of the contract documents, prepared by the architect, which may modify provisions of the general conditions of the contract.

progress payments

Payments made to the contractor during progress of the work on account of work completed and/or materials suitably stored.

change in services ( of the architect)

Professional services rendered by the architect, upon the owner's request, in addition to the basic services identified in the owner-architect agreement.

extra services

Professional services rendered by the architect, upon the owner's request, in addition to the basic services identified in the owner-architect agreement.

alternate bid

Proposal by bidder for amount to be subtracted from, or added to, the base bid if the corresponding change in the work is accepted.

advertisement for bids

Published public notice soliciting proposals for a construction project.

barrier-free provisions

Regulations that provide for accessibility to buildings and sites for persons with disabilities.

direct personnel expense (DPE)

Salaries and wages attributable to a specific project, plus benefits, such as employment taxes, insurance, sick leave, holidays, vacations, pensions, and similar contributions and benefits.

addenda

Statements or drawings that modify the basic contract documents after the latter have been issued to the bidders, but prior to taking of bids.

Division One

The General Requirements Division of the specifications that establishes the administrative and procedural duties of the contractor, architect, and owner during construction.

general contract

The agreement between the owner and the contractor for the construction of a project.

guaranteed maximum cost

The amount established by agreement between owner and contractor as the maximum cost of performing specified work.

comprehensive services

The architect's basic services expanded to include certain additional services, such as programming, land use studies, etc.

project representative

The architect's representative at the site, who assists in the general administration of the construction contract for a project.

basic services

The architectural services normally required for a building project, usually consisting of schematic design, design development, construction documents, bidding or negotiation, and construction contract administration.

final completion

The completion of all work in accordance with the terms and conditions of the contract documents.

superintendent

The contractor's representative at the site.

date of substantial completion

The date, certified by the architect, when the construction is sufficiently completed, in accordance with the contract documents, so that the owner can occupy the project or specified area of the project for the intended use.

trade discount

The difference between the list price and the actual price paid.

means of egress

The elements that comprise an exit to the outside, including aisles, corridors, doors, and stairways.

XCU

The exclusion from insurance coverage for liability arising out of (X) explosion or blasting, (C) collapse of or structural damage to a building, and (U) underground damage.

float

The extra time available for a construction activity above its estimated time duration, without causing any delay of project completion.

bidding documents

The invitation to bid, instructions to bidders, bid form, and the contract documents.

lowest acceptable bona fide bid

The lowest bid that complies with all the stipulated requirements.

project manual

The manual prepared by the architect for a project, including the technical specifications, bidding instructions and forms, general conditions, supplementary conditions, special conditions, and other legal and administrative documents.

clerk of the works

The owner's job site representative.

general conditions

The part of the contract documents that states the rights, responsibilities, and relationships of the parties involved, usually by means of a standard document published by the American Institute of Architects.

working drawings

The part of the contract documents, prepared by the architect, that graphically illustrates the construction required for the project.

contract time

The period of time within which the work must be completed, as established in the contract documents.

due care

The requirement that a professional exercise reasonable ability and judgment in a specific circumstance, the absence of which constitutes negligence.

standard of care

The requirement that a professional exercise reasonable ability and judgment in a specific circumstance, the absence of which constitutes negligence.

subrogation

The substitution of one entity for another with regard to legal rights.

construction budget

The sum established by the owner as available for construction of the project.

project budget

The sum established by the owner as available for the entire project, including the construction budget, land cost, equipment cost, financing cost, cost of professional services, and contingency allowances. See construction budget.

base bid

The sum of money stated in the bid for which the bidder offers to do the work, not including any alternate bids.

contract sum

The total amount payable by the owner to the contractor, as stated in the owner-contractor agreement, for performing the work under the contract documents.

construction documents

Working drawings and specifications.

contract documents

Working drawings, specifications, addenda, general conditions of the contract, supplementary conditions, and the owner-contractor agreement.

payment request

application for payment.

upset price

guaranteed maximum cost.

overhead expense

indirect expense.