Contract Administration and Contract Practice

Question 1

What is loss and expense?

Answer 1

Is a clause within the payment section of JCT Contracts. Section 4.15 in JCT ICD.

Question 2

What are the differences between JCT MW & IC

Answer 2

MW does not have provisions for:
- sectional completion clauses,
- collateral warranty provisions,
- Named sub-contractor
- advanced payments

Question 3

What is the difference between collateral warranty and third party rights?

Answer 3

Both effective security for third party beneficiries but Collateral Warranties are more prevalent in my experience.

Adjudication only applies to collateral warranties.

Collateral warranties mirror the repsonsibilities of the underlying contract, however can be seen as a large administrative exercise.

Question 4

What is a collateral warranty?

Answer 4

It is an agreement associated with another contract, which extends the duty of care to be extended by a contractor to a party not within the original contract.

Question 5

Difference between PI, Public Liability Insurance and Employers Liability?

Answer 5

PI (Professional indemnity insurance) is to protect you and your company against acts of professional negligence or inadequacy your service.

Public Liability Insurance helps protect the contractor and client against claims of injuring to public/client or damage to property.

Employers Liability Insurance helps compensate you for when an employer becomes injure or ill due to the work they do.

Question 6

What are Third Party Rights?

Answer 6

It comes from the Contracts (Rights of Third Parties) Act 1999, which enforces the individual terms of a contract, not the whole contract.

Question 7

What is arbitration?

Question 8

What are the different types of dispute resolutions used in a construction contract?

Answer 8

Negotiation, firstly. If the parties can not successful resolute the dispute then;
mediation
adjudication
arbitration

Question 9

What is the finance act 2004?

Answer 9

I am do not have knowledge of specfic details of the finance act 2004 but it is referenced in JCT contracts in line with the Construction Industry Scheme. it sets out the requirement to pay the correct tax and VAT.

Question 10

What is a performance bond?

Answer 10

is a form of securiyt to protect the client against contractor failing to fulfil their clients obligations. Insolvency is a risk for contractors. If this occurs the bond provides compensation guaranteed by a third party (upto the amount stated) c.10%.

Question 11

What is Parent Company guarantee?

Answer 11

It is a method of financial security. It does not come with additional fees.

Question 12

What are the principal make up of a contract?

Answer 12

Offer, acceptance, consideration

Question 13

What are differences between two-stage tender and traditional?

Answer 13

Two-stage is typically used for DB Contracts and require an initial competitive bid and proposal and then a negotiated second stage.

Tradiational tender requires substantially complete design with sections of performance specification.

Question 14

What is included in warranty documents?

Answer 14

Client - name & address
Supplier - Name & address
Descirption of the insured/guaranteed
The length of warranty
Assignablility
requirements to keep to warranty valid.

Question 15

What is a letter of intent?

Answer 15

I do not condon a letter of intent. It is not necessarily legally binding but confirms 2 companies intent to enter a contractual agreement.

Question 16

What is a retention?

Answer 16

a sum of money held to ensure that contractual obligations have been satisfied.

Question 17

What are the benefits of joint name policy?

Question 18

Please may you provide examples of relevant matters?

Answer 18

Failure to provide possession, infomration, variations, opening up instructions.

Question 19

Did you adjust the programme length when you removed the section of works?

Answer 19

No it was not on the critical path.

Question 20

When is part L triggered?

Answer 20

50% of a thermal element or 25% of external fabric.

Question 21

Why did you not carry out the role of PD?

Answer 21

A more experience and competent colleague carried out the role of PD.

Question 22

What are the issues with a letter of intent?

Answer 22

A letter of intent intends to enable works to commence prior to completion of the contract. This means that both parties are comnmencing without the the protections of a full contract in place.

Question 23

You said that you acted as principal designer, what roles did you undertake?

Answer 23

savills uk ltd were named as PD since the colleague that i was assisting has depth of experience and expertise in similar projects and i was able to assist with the formation of documents in compliance with CDM.

Question 24

How did were teh contractor design portion of works signed off?

Answer 24

Works can either be self-certified by competent trades person or building control.

A Competent Person must be registered with a scheme that has been approved by MHCLG (Ministry of Housing, Communities & Local Government)

Question 25

What are the clients duties under CDM?

Answer 25

The client has the ultimate responsibility for the works being carried out in a safe manner and this achieved by:

appointing competent people
writtne appoiintment
providing adequate information including Pre-Construction information pack.

Question 26

What is in the H&S file?

Answer 26

Must include a summary of works,
Residual risk
Hazardous materials
Key components
cleanign maintenance
as-built drawings
Testing and certificates

Question 27

What are included in preliminary documentation?

Answer 27

Welfare provisions,
licences

Question 28

What is included in the Pre-Construction information pack?

Answer 28

Duties of all parties unde CDM.
H&S file
Property desciption
location
directory
site risks and restrictions
design and construction hazards
Key dates

Question 29

What are included in the preliminaries?

Answer 29

Contract details, who it is executed, insurance requirements, bonds, base date, types of contract, quality standards, tendering process, security, specific limiations, works undertaken by others,

Question 30

what are include in teh preambles?

Answer 30

It is an explanatory note describing the works,
the partues, tendering procedures and competence of the construction team.

Question 31

What is a listed item?

Answer 31

A listed item is a pre-agreed item to be paid paid off site.

Question 32

What is an advanced payment and an advanced payment bond?

Answer 32

A agreed payment made prior to delivering of the product or service.

If the client agrees to make an advance payment (sometimes referred to as a down payment) to a supplier, a bond may be required to secure the payment against default by the contractor.