CONTRACT ADMINISTRATION

Question 1

What is nomination

Answer 1

Selection of a particular subcontractor by the client to carry out works, manufacture or supply of materials.

This provides the architect and client with greater control of material choice and thereby quality.
It is often used when there are long lead-in times with the employer placing orders prior to the Main Contract award which reduces potential delays on site.
The Main Contractor is relieved of liability of design and compliance with the performance spec in addition to subcontractor delays in respect of the works that have been nominated.

Question 2

How do nominated subcontractors get paid

Answer 2

Nominated Contractors are normally paid via the Main Contract, with sums identified separately.

Question 3

Can the contractor object to a nominated subcontractor?

Answer 3

Any objections must be made during the tender period.

There are specific exclusions and grounds for an objection for example if they have found out the subcontractor is having financial difficulties and may be going insolvent

Question 4

If there are problems with the design, after Novation of the architect, who would be responsible

Answer 4

At Novation, the client would agree the design
In Novation, the benefits and obligations are transferred, so now the contractor is responsible for the Architect and design issues
Disputes may arise where it becomes unclear when problems have arisen, either prior to the transfer of services or afterwards.

Question 5

What is set-off

Answer 5

Money owed to the client by the contractor
They are deducted against payments due to the Contractor

Question 6

Describe differences between Statutory Provisions and Contract Provisions

Answer 6

Statutory provisions are set out by law & must be complied with.
Contract provisions relate to the contract in question & therefore only apply to a specific project.

Question 7

After valuation and certificate are issued, the client advised that they don’t have sufficient funding to make the payment. What would you do

Answer 7

Once the certificate has been issued to the contractor, the client is contractually obliged to honour payment of the certificate and cannot withhold money without a valid reason.
I would contact the client and contractor ASAP to arrange some form of payment. It may be the case that the client has insufficient funds available in time for the final date for payment and it may be possible to defer payment by 1-2 days.
Failing this or if the contractor is unwilling to delay the payment, the client would need to find finance the payment through other funds to honour the certificate.

Question 8

If an instruction was issued during the contract which involved the fabrication of a substantial amount of materials off site would you pay for them as off site materials within the valuation

Answer 8

I would check if there is a provision for off site materials in the contract
There is no obligation on the client to pay for materials off site if this is not identified in the contract
However in the scenario where the client wishes to pay for them, I would ultimately check with the client before paying or rejecting them.

Question 9

How would you deal with the urgent Verbal Instructions

Answer 9

If the instruction affects the critical path or programme, I would review the instruction with the contractor administrator, client & contractor.

If the instruction is valid under the contract I would ensure this is converted into a formal written instruction as soon as possible.

Question 10

What documents would be required in incorporating a Contractor Design Portion Supplement into a project

Answer 10

Within a Design & Build project, the documentation to be included would be the Employers Requirements including the Scope, Specification, Drawings, Contractors Proposals along with any insurances

Question 11

Could an e-mail constitute a contract document?

Answer 11

Yes providing there is offer, acceptance, intention to create legal relations and the responding email does not vary the conditions, a contract will be created.

Question 12

What is your opinion of Oral Contracts?

Answer 12

Whilst they are legally binding the difficulty lies in proving the specific terms and conditions of the agreement

It is for this reason why the HGCRA only applies to written contracts.

Question 13

What is the difference between an information requirement schedule & an information release schedule?

Answer 13

a. The information required schedule asks the Contractor to provide dates when design information is required.
b. The information release schedule informs the Contractor when the design information will be available.

Question 14

What is Frustration

Answer 14

Frustration occurs when any event or circumstances beyond control of both parties changes the contractual obligations or makes it impossible or illegal to fulfil their contractual obligations. The happening of such events automatically discharges contract.

Question 15

What is the defects liability period

Answer 15

The defects liability period is the duration at the end of the contract, usually 6-12 months after the PC Certificate has been issued whereby the contractor undertakes to rectify any defects that arise within the structure at the contractors expense, providing they were due to materials & workmanship not being in accordance with the contract.
In the event that the contractor failed to rectify any defects the employer may employ another contractor to carry out the works & recover the cost of doing so from the Main Contractor.
The retention money retained may be used to cover the costs of making good.

Question 16

What is your understanding of latent defects and what contractual issues are associated with them

Answer 16

Latent defects are defects which are not readily identifiable upon inspection & only come to fruition some time after building completion and may take many years to become identifiable.

A claim in contract can only be brought about within the limitation period of the contract, 6 or 12 years depending on whether the contract was executed as a deed or underhand.

Question 17

What should the CA do if latent defects are discovered

Answer 17

The Architect should issue an instruction to instruct the contractor what to do if they are identified.
This can include telling them to comply with a third party who is examining or opening up the works to identify the defect.

Question 18

If the works or materials are not in accordance with the Contract what options does the CA have available to them

Answer 18

The architect may:-
o Instruct the contractor to remove all defective work, materials and goods at their own expenseand time.
o They can notify in writing that they can remain with an appropriate deduction being made from the contract sum.
o Issue instructions for variations that are necessary as a result of the work. If they are necessary there should be no additional costs or extension of time given.
o Instruct the contractor to open up and test further work to determine the extent of any noncompliance

Question 19

When issuing instructions for further opening up and testing to determine the extent of non-compliance what sort of things should the CA consider

Answer 19

a.Time and consequential costs of further opening up.
B. significance of the non-compliance.
C. Consequences of further non-compliance on building owners and users, adjoining property and the public

Question 20

What is a provisional sum and what are the two types and where are they defined

Answer 20

A sum of money included in the contract for work that cannot be fully designed and costed at the time of tender or contract sum agreement.
Defined and Undefined
They are defined in the NRM

Question 21

What is a defined provisional sum

Answer 21

A sum included in the contract for work that has not been completely designed at the time of contract sum agreement but for which certain specified information can be given about the extent of works, its quantity, duration of installation and how it is to be fixed to the building.

Question 22

What is the contractor deemed to have allowed on the inclusion of a defined provisional sum

Answer 22

They are deemed to have made proper allowances for carrying out the work in their programme and preliminaries.
This means that they are not entitled to an extension of time or extra prelims for carrying out the work, whatever the delay or cost of doing so to the contractor.

Question 23

What if the actual work does not closely resemble the works allowed n the inclusion of a defined provisional sum

Answer 23

If the description is not accurate it has to be amended.
This will be treated as a variation.
This will entitle the contractor to an extension of time and extra preliminaries if appropriate.

Question 24

What is an undefined provisional sum

Answer 24

A sum included for work for which there is minimal or no information at the time of contract sum agreement.

The location, quantity and time associated for the installation of the works is not fully known

Question 25

What is the contractor deemed to have allowed for an undefined provisional sum

Answer 25

They are not deemed to have allowed for anything

Expenditure of the undefined provisional sum may carry additional costs for programme or preliminaries as a result of carrying out the works.

Question 26

How can a provisional sum be expended

Answer 26

The architect has to issue an instruction for its expenditure

Question 27

How are provisional sums dealt with in the final account

Answer 27

The provisional sums included in the contract are deducted and the actual amount substituted

Question 28

What are the risks associated with provisional sums

Answer 28

The actual cost and time exceeds that allowed for in the provisional sum because the nature of the item changes between tender and instruction

Question 29

Can you have an EOT without an L&E claim

Answer 29

Yes - an EOT does not automatically entitle a contractor to loss and expense, only time

Question 30

When pricing an EOT what would you include for and what rates

Answer 30

Prelim due prolongation e.g, site cabins, welfare, staff, overheads etc

Question 31

Would you get involved in helping the Architect assess the Extension of Time

Answer 31

Yes as the QS assess’ the financial implications

Question 32

If there is a discrepancy between the employer’s requirements and contractor’s proposals which prevail

Answer 32

The CPs

Question 33

What is the contractor’s design liability under JCT contracts

Answer 33

The same as an independently employed architect with the duty to offer reasonable skill and care.

Question 34

When would you use JCT Minor Works

Answer 34

a. Projects that are short in duration on a small scope with a straight forward construction.
b. JCT guidance is for a value up to £200,000 but it has to be simple in nature.
c. It is a lump sum form where design should be completed prior to execution.
d. The client’s team is to provide specifications, drawings and a schedule of works.

Question 35

When would you use JCT Intermediate Contract

Answer 35

a. Projects less than a year
b. The project should be simple in content and require only basic skills and trades where services are not
complex
c. Where the works are already designed.

Question 36

When would you use a JCT SBC with quantities

Answer 36

It is suitable for use with a bill of quantities and is a lump sum form. The employer takes the risk of errors in the bill.
Where the work has already been designed at execution.
The contractor’s risk is limited to price only.

Question 37

When would you use JCT Standard without quantities

Answer 37

This is suitable where work has been designed prior to contract however there is no bill of quantities.
The contract documents will include drawings, specification and a schedule of rates.
It is a lump sum form of contract.
The contractor’s risk includes both price and quantity.

Question 38

When would you use JCT SBC with approximate quantities

Answer 38

This is a remeasurement form of contract.
There is no fixed contract sum.
It is used where the design is not completed at the time of execution.
An approximate bill of quantities will have been prepared.
Construction is aimed to commence prior to the design being completed.

Question 39

When would you use JCT DB

Answer 39

When the contractor is responsible for design and construction.
The project should be similar in complexity to that of standard building contracts.
The contactor’s proposals form the basis of the contract.
There is no mention of an architect or QS instead this role is replaced by the title of Employers Agent.