CPCM Certified Professional Contract Manager: Contract Law and Legal Frameworks 5

Question 1

Under the False Claims Act (31 U.S.C. §§3729-3733), a contractor who knowingly submits a false claim to the government faces civil penalties of:

Accepted Answer

Between $13,000 and $27,000 per false claim plus treble damages

Answer

The False Claims Act imposes per-claim civil penalties (adjusted periodically for inflation, approximately $13,000–$27,000) plus three times the government's actual damages.

Question 2

Which doctrine permits a party to enforce a promise even without consideration when the promisor should have reasonably expected detrimental reliance?

Accepted Answer

Promissory estoppel

Answer

Promissory estoppel (Restatement §90) substitutes detrimental reliance for consideration when a clear promise induces reasonably foreseeable action or forbearance by the promisee.

Question 3

A subcontract contains a 'pay-when-paid' clause. Under most U.S. court interpretations, this clause:

Accepted Answer

Creates a timing mechanism but does not transfer the risk of owner non-payment to the subcontractor

Answer

Most courts interpret pay-when-paid clauses as setting a timing condition, not a condition precedent, so the prime contractor must pay within a reasonable time regardless of owner payment.

Question 4

What is the statute of limitations for a contractor to file a claim under the Contract Disputes Act against the federal government?

Accepted Answer

6 years from the accrual of the claim

Answer

The Contract Disputes Act (41 U.S.C. §7103(a)(4)(A)) requires contractors to submit claims within 6 years after the claim accrues, i.e., when all events giving rise to the claim are known or should be known.

Question 5

A contract clause that liquidates damages at a set amount per day of delay is enforceable if:

Accepted Answer

The stipulated sum is a reasonable estimate of anticipated damages and actual damages are difficult to ascertain

Answer

Liquidated damages clauses are enforceable when they represent a reasonable pre-estimate of harm and actual damages would be difficult to calculate, distinguishing them from unenforceable penalties.

CPCM Exam Practice Test

CPCM Exam Practice Test

CPCM Certified Professional Contract Manager: Contract Law and Legal Frameworks 5