CM 4211 Final Flashcards

Study Notes

Legal Agreements and Concepts

A conditional agreement with an offer is considered acceptance, highlighting the importance of clarity in contract terms.
Consideration in contracts does not have to be monetary; value can also be in services or goods exchanged.
Most contract breaches occur due to express conditions, underscoring the need for precise contractual language.

Contract Terms and Conditions

A cost-plus-percentage fee arrangement incentivizes contractors to manage costs effectively, balancing project budgets.
Liquidated damages refer to a predetermined amount payable for delays, ensuring accountability for timely project completion.
In guaranteed maximum price contracts, contractors may bear financial risks, contradicting the notion that they cannot lose money.
The bid form is typically prepared by the contractor, shifting responsibility for accurate bids to the bidding party.

Bidding and Contracts

Changes in contracts are subject to a changes clause, which typically grants owners the unilateral right to modify agreements.
Contractors must not overly rely on Physical Conditions Reports with disclaimers; these reports may not always guarantee accuracy.
Owners are obligated to compensate contractors for materials on-site, even if not yet part of the project, ensuring financial fairness.

Business Structures and Licensing

"F.O.B." refers to "Freight on Board," not "Freight Overboard," affecting shipping and liability terms in contracts.
Corporations are characterized by perpetual duration, differing from partnerships that may dissolve more easily.
"LLC" stands for Limited Liability Company, which offers protection to owners from personal liability.
A conventional joint venture mandates that all members be licensed contractors for construction-related projects.

Insurance and Bonds

Builder's risk policies typically exclude coverage for losses due to underbidding or war-related damages.
Performance bonds do not automatically guarantee contractor payments; the penal sum is not a definitive measure of obligations.
A mechanics bond ensures that successful bidders will enter contracts if awarded the project.

Legal Procedures and Court Matters

Public liability policies do not cover injuries sustained by contractors on-site; such coverage requires separate agreements.
Courts enforce liquidated damages only if they are reasonable and correlating with actual project completion costs.

Contract Administration

Timely notice is the cardinal rule of contract administration, vital for maintaining transparency and accountability.
Documentation is essential, even for small projects, as proper records can protect against disputes.

Ethical Considerations in Contracting

Various actions, such as lending contractor licenses for unauthorized use or manipulating bid selections, are inherently unethical and undermine integrity in the industry.
The act of retrospectively altering logbooks to reflect events inaccurately is considered dishonest.

Dispute Resolution

Alternative dispute resolution methods include arbitration and lawsuit proceedings, with arbitration generally being more formal.
The findings of dispute review boards are not admissible in future litigation, emphasizing the importance of thorough documentation for disputes.

Project Management

Project managers are responsible for scheduling subcontractors, highlighting the need for effective coordination in project timelines.
A graveyard shift typically compensates workers more than day shifts due to increased challenges associated with night work.

Project Delays and Changes

A compensable delay entitles contractors only to cost adjustments, restricting claims to the direct financial impacts rather than overarching losses.
The doctrine of contra proferentem favors the interpretation that benefits the non-drafting party, guiding legal interpretations in disputes.

Description

Test your knowledge with these final flashcards for CM 4211. Each card presents a statement regarding contracts, requiring you to identify the false one. Perfect for reviewing key concepts before the final exam.