Construction Contracts 2024 Test Questions with Correct Answers

Construction Contracts 2024 Test Questions with Correct Answers Construction parties - Answer-owners- analysis, financing -(realty personnel for the parcel of land on market) -designer, a report describes the program requirements - construction docuemtn -contructors contructing procedures - Answer-General contract method, separate contracts, self-performance, design-build, professional construction management method construction management at risk (CM at risk) General contract method -design-bid-build approach - Answer-owners draw up the contract documents with the designer and the constructor- open bid for public projects This procedure has legal controls designed to prevent fraud and collusion on public works. The general contractor usually has a specialization in one of the major components of the project + : the general contractor has unique skills that should reduce the costs of construction to the owner. +: a firm idea of the final cost of the total projec - the owner had the requisite skills of management in construction -extends the project duration. -the owner does not have an agent, a greater probability of claims brokerage - Answer-the general contractor subcontracts all the work on a project. owner - contractual limits on the amount of work that can be subcontracted Separate Contracts Method - Answer-the multiple prime contracts, a general contract method without the general contractor = the owner has in-house capability to manage a construction project - many states require a general contractors`s license, owner must have + a competent construction manager/ engineer + the required specialty work is restricted to a few types of construction +eliminate general contractor profit(small) - owner assume greater risk Self-Performance Method - Answer-1- "Force account" work 2- No contracts written 3- Owners workers perform work 4- Owner provides materials 5- Minor role for designer small in scope, simple in character( maintenance projects) Davis-Bacon Act of 1931 - Answer-This law requires the payment of "prevailing wages" to employees of contractors and subcontractors working on government construction projects. Design-Build - Answer-The owner contracts with one entity (a person or firm) to provide both design and construction services, that entity then subcontracts portions of the work to others as needed GMP, guaranteed maximum price single firm or joint venture + no extensive design to compute a bid + design evolves with constructor input, fewer changes will arise during construction due to designer error + owner is not part of the dispute between contractor and designer +fast-tracking + large and technically complex projects, + owner clearly define the scope of the project prior to a formal design-build contract -less control by the owner professional construction management method - Answer-the owner hires a firm with construction expertise to perform construction management(CM) services on the owner's behalf. - agent - general contractor hired before any substantial design work and construction work Value engineering (CM part) reviews the project design flat fee (share cost savings) or a cost plus a percentage fee designers are paid in direct relation to the cost of the construction project the CM does not perform any of the construction work with its own forces + large or complex projects, construction expertise is needed during the design phase +flexibility for changing the project as the design evolves CM at Risk, GC/CM or the CM/GC - Answer--CM agent- independent contractor the CM is responsible to the owner to complete the project by the established substantial completion date and within the agreed budget the CM at risk firm enters the contract prior to design completion a cost plus a fixed fee with a GMP. execute a contract - Answer-fully executed execute a contract : signed, bound executory : some portion of the agreement remains to be done. express contract/ implied contract - Answer- element of a contract - Answer-offer and acceptance meeting of minds consideration - so regarded by both parties;is the essential reason for a party entering into a contract; be of value lawful subject - definite and clearly defined competent parties( not insane)