CPCM Certified Professional Contract Manager: Negotiation and Conflict Resolution in Contracts 2 — Questions and Answers
Question 1: Which negotiation strategy involves making a high initial offer to anchor the counterparty's expectations?
- Anchoring (Correct answer)
- Logrolling
- BATNA positioning
- Nibbling
Correct answer: Anchoring
Anchoring sets a reference point that influences the other party's perception of a fair outcome.
Question 2: Under the UCC, when parties have conflicting terms in their standard forms, which doctrine determines what becomes part of the contract?
- Battle of the forms under UCC 2-207 (Correct answer)
- Mirror image rule
- Parol evidence rule
- Promissory estoppel
Correct answer: Battle of the forms under UCC 2-207
UCC 2-207 allows a contract to form even if the acceptance contains different or additional terms, resolving conflicts through specific rules.
Question 3: A contract manager discovers mid-performance that a key subcontractor is in financial distress. The BEST first step is to:
- Issue a cure notice and request adequate assurance (Correct answer)
- Terminate the subcontract immediately
- Withhold progress payments
- File a claim with the surety
Correct answer: Issue a cure notice and request adequate assurance
Requesting adequate assurance under UCC 2-609 preserves the contract while addressing insolvency risk before a breach occurs.
Question 4: In interest-based negotiation, what does 'separating people from the problem' primarily achieve?
- Reduces emotional barriers so parties can focus on substantive issues (Correct answer)
- Eliminates the need for a mediator
- Allows unilateral concessions without precedent
- Shifts liability to the other party
Correct answer: Reduces emotional barriers so parties can focus on substantive issues
Depersonalizing the dispute helps negotiators engage with underlying interests rather than defending positions.
Question 5: Which clause most effectively limits a contractor's liability exposure for consequential damages arising from contract disputes?
- Mutual waiver of consequential damages clause (Correct answer)
- Limitation of liability clause capped at contract value
- Force majeure clause
- Indemnification clause
Correct answer: Mutual waiver of consequential damages clause
A mutual waiver of consequential damages contractually excludes lost profits and other indirect losses for both parties.
Question 6: During a contract negotiation, the other party uses a 'good cop/bad cop' tactic. The most effective counter-strategy is to:
- Name the tactic explicitly and refocus on interests (Correct answer)
- Match the tactic by introducing your own two-person team
- Refuse to negotiate until the 'bad cop' leaves
- Make a concession to the 'good cop' quickly
Correct answer: Name the tactic explicitly and refocus on interests
Identifying the tactic aloud neutralizes it by removing its psychological effectiveness.
Question 7: A partnering charter in construction contracts is BEST described as:
- A non-binding agreement on shared goals and dispute escalation procedures (Correct answer)
- A formal contract amendment requiring board approval
- A bonding instrument securing performance
- A legal precedent for future claim settlement
Correct answer: A non-binding agreement on shared goals and dispute escalation procedures
Partnering charters are relationship documents that outline collaborative principles without creating legal obligations.
CPCM Certified Professional Contract Manager: Negotiation and Conflict Resolution in Contracts 2
Which negotiation strategy involves making a high initial offer to anchor the counterparty's expectations?