BCM Construction Law and Contracts 3

Question 1

A differing site condition (Type I) claim arises when:

Accepted Answer

Actual site conditions materially differ from what was indicated in the contract documents

Answer

The contractor encounters unexpected labor shortages

Answer

Weather delays exceed the contract allowance

Answer

The owner changes the project scope mid-construction

Question 2

Which dispute resolution method is generally faster and less expensive than litigation in construction disputes?

Accepted Answer

Arbitration

Answer

Trial by jury

Answer

Appeals court review

Answer

Legislative mediation

Question 3

The statute of limitations in construction defect claims refers to:

Accepted Answer

The time period within which a legal claim must be filed after discovery of a defect

Answer

The maximum warranty period required by code

Answer

The time the contractor must correct defective work during construction

Answer

The period the owner has to submit punch list items

Question 4

Retainage in construction contracts is best described as:

Accepted Answer

A percentage withheld from each payment application to ensure contractor performance through completion

Answer

A deposit paid by the contractor before mobilization

Answer

Profit margin the contractor adds to cost-plus contracts

Answer

A penalty deducted for safety violations on the job site

Question 5

Force majeure clauses in construction contracts typically provide relief from:

Accepted Answer

Unforeseeable events beyond a party's control, such as natural disasters or pandemics

Answer

Any project delay regardless of cause

Answer

Owner-directed scope changes

Answer

Subcontractor payment delays

Question 6

The right to terminate a construction contract 'for convenience' allows the owner to:

Accepted Answer

End the contract at any time without the contractor being in default, with compensation to the contractor

Answer

Terminate only when the contractor materially breaches the agreement

Answer

Stop work and pay nothing if the project is cancelled

Answer

Transfer the contract to another contractor without consent