CEP Contract Documentation & Legal Considerations 2

Question 1

Which contract clause establishes the priority order when conflicts exist between different contract documents?

Accepted Answer

Order of precedence clause

Answer

An order of precedence clause specifies which contract document governs when contradictions exist between drawings, specifications, and other documents.

Question 2

A 'no damages for delay' clause in a construction contract typically means the contractor:

Accepted Answer

Can only recover time, not additional money, for owner-caused delays

Answer

A no-damages-for-delay clause limits the contractor's remedy for owner-caused delays to a time extension only, not additional compensation.

Question 3

What is the primary purpose of a 'liquidated damages' provision in a contract?

Accepted Answer

To provide a predetermined compensation amount for specific breaches such as schedule delays

Answer

Liquidated damages clauses establish a pre-agreed daily or weekly amount the contractor owes the owner for failure to complete by the contract completion date.

Question 4

Under the Miller Act, payment bonds on federal construction projects are required when the contract value exceeds:

Accepted Answer

$150,000

Answer

The Miller Act requires performance and payment bonds on federal construction contracts exceeding $150,000.

Question 5

A 'cardinal change' to a construction contract is best described as:

Accepted Answer

A modification so substantial it fundamentally alters the scope of the original contract

Answer

A cardinal change is one so drastic that it cannot be considered part of the original contract, potentially allowing the contractor to treat it as a breach.

(CEP) Certified Estimating Professional Practice Test

(CEP) Certified Estimating Professional Practice Test

CEP Contract Documentation & Legal Considerations 2