CCA Construction Change Orders and Claims 2 — Questions and Answers
Question 1: The 'total cost method' for calculating a construction claim is generally considered:
- The most reliable and preferred method
- A method of last resort because it assumes all cost overruns are the owner's responsibility (Correct answer)
- Required by AIA contract forms
- The standard method for federal government claims
Correct answer: A method of last resort because it assumes all cost overruns are the owner's responsibility
The total cost method calculates damages as all costs incurred minus the original bid, which is disfavored because it presumes no contractor error and ignores bid accuracy.
Question 2: A construction contractor claims delay damages using the 'measured mile' approach. This method:
- Calculates delay based on total project duration divided by total cost
- Compares productivity in an impacted work period to an unimpacted reference period on the same project (Correct answer)
- Uses industry average productivity rates
- Applies a fixed percentage markup to direct costs
Correct answer: Compares productivity in an impacted work period to an unimpacted reference period on the same project
The measured mile compares actual productivity during the impacted period to the contractor's own unimpacted performance, providing a project-specific and credible impact measure.
Question 3: Which notice requirement, if not met by a contractor, can result in waiver of a claim for additional compensation or time?
- Monthly safety meeting attendance
- Timely written notice of claim within the period specified in the contract (Correct answer)
- Submission of certified payroll
- Filing a mechanics lien
Correct answer: Timely written notice of claim within the period specified in the contract
Most construction contracts require written notice of a claim within a specified period after the triggering event; failure to provide timely notice may waive the claim entirely.
Question 4: Which type of delay entitles a contractor to both a time extension AND additional compensation?
- Excusable non-compensable delay
- Compensable delay caused by owner actions (Correct answer)
- Concurrent delay caused by both parties
- Force majeure event
Correct answer: Compensable delay caused by owner actions
A compensable delay, caused by owner actions such as late deliverables, design errors, or access restrictions, entitles the contractor to both time and money.
Question 5: A contractor submits a claim for extended general conditions costs during an owner-caused delay. An auditor should verify that the claimed costs are:
- Standard industry overhead rates
- Actual time-related field overhead costs incurred during the extended period (Correct answer)
- The contractor's home office overhead
- Equal to 10% of the original contract value
Correct answer: Actual time-related field overhead costs incurred during the extended period
Extended general conditions claims must be supported by actual cost records showing time-related field overhead (supervision, temporary facilities, etc.) incurred during the owner-caused delay period.
Question 6: In federal construction contracting, a contractor may submit a Request for Equitable Adjustment (REA) to recover costs arising from a government-caused change. An REA differs from a certified claim in that:
- An REA does not require contractor certification (Correct answer)
- An REA cannot seek additional time
- An REA requires submission to a court
- An REA must be denied before appeal
Correct answer: An REA does not require contractor certification
An REA is an informal request for compensation that does not require the formal certification required for a certified claim under the Contract Disputes Act.
CCA Construction Change Orders and Claims 2
The 'total cost method' for calculating a construction claim is generally considered: