Contract Drafting & Performance Management Flashcards

Which contract management practice involves tracking milestones, deliverables, and deadlines to ensure timely performance?

Answer: Contract administration calendar

A contract administration calendar documents key dates—milestones, renewal windows, reporting deadlines—to ensure obligations are tracked and met throughout the contract term.

Under U.S. contract law, what is the effect of a 'time is of the essence' clause?

Answer: It makes deadlines material terms whose breach may justify termination

When a contract states 'time is of the essence,' missing a deadline constitutes a material breach entitling the non-breaching party to terminate and seek damages.

A contractor submits a request for equitable adjustment (REA) after a government-directed change increases project costs. What is the REA's primary purpose?

Answer: To recover additional costs and, in some cases, profit caused by the government-directed change

An REA allows a contractor to seek compensation for increased costs and schedule impacts resulting from government-directed changes, differing site conditions, or other government actions.

What is the key difference between a 'warranty' and a 'representation' in a contract?

Answer: A representation is a statement of current fact; a warranty is a promise that a fact is and will remain true

A representation is an assertion of a present fact that induces a party to contract; a warranty is a contractual promise that facts are true and will continue to be true, with remedies for breach.

In performance bond provisions, what obligation does the surety assume if the principal (contractor) defaults?

Answer: The surety completes the project or pays the cost of completion up to the bond amount

A performance bond obligates the surety to ensure project completion by either financing completion, arranging for a replacement contractor, or paying the owner's completion costs.

Which approach to contract drafting prioritizes plain language to reduce litigation risk?

Answer: Writing provisions in clear, simple language that non-lawyers can understand

Plain language drafting reduces ambiguity, improves comprehension for all stakeholders, and decreases the likelihood of disputes over contract meaning.

What is the purpose of a 'benchmarking' clause in a long-term IT outsourcing agreement?

Answer: To allow the buyer to compare the vendor's pricing and service levels against market alternatives periodically

A benchmarking clause enables the buyer to verify that contract pricing and service quality remain competitive against the market over the life of the agreement.