Terms/Definitions

Question 1

local ordinances

Answer 1

law usually found in…

Question 2

CCDC 2

Answer 2

Fixed Price Contract is a standard prime contract between Owner and prime
Contractor that establishes a single, pre-determined fixed price, or lump sum, regardless of the Contractor’s actual costs

Question 3

CCDC 3

Answer 3

Cost plus fee contract between Owner and prime Contractor to perform the
required work on an actual-cost basis, plus a percentage or fixed fee which is applied to
actual costs.

Question 4

CCDC 4

Answer 4

Unit Price Contract is a standard prime contract between Owner and prime
Contractor to perform the required work for a pre-determined, fixed amount for each
specified unit of work performed.

Question 5

parol evidence

Answer 5

A rule of contractual construction which states that extrinsic evidence cannot be used to
vary the terms of a written contract.

Question 6

contra proferentem

Answer 6

The contra proferentem rule is a rule in contract law which states that any clause considered
to be ambiguous should be interpreted against the interests of the party that requested that
the clause is included.

Question 7

liquidated damage

Answer 7

Damages that have been pre specified in the contract and are already covered
in the contract documents (ie. Allowance for damaged materials)

Question 8

punitive damage

Answer 8

Excessive damages that are not covered in the contract documents

Question 9

due diligence

Answer 9

due diligence’ simply refers to taking reasonable steps or exercising reasonable care in
relation to a particular course of action

Question 10

Mechanics Lien

Answer 10

A guarantee of payment to builders, contractors and construction firms that build or repair
structures. Mechanic’s liens also extend to suppliers of materials and subcontractors and
cover building repairs as well.

Question 11

Installation Floater

Answer 11

An installation floater is an insurance policy that covers personal property installed,
fabricated or erected by a contractor.

Question 12

Addenda

Answer 12

Written information adding to, clarifying or modifying the bidding documents. An addendum
is generally issued by the owner to the contractor during the bidding process

Question 13

Bonds, surety, oblige, principal

Answer 13

A surety bond or surety is a promise by a surety or guarantor to pay one party (the obligee)
a certain amount if a second party (the principal) fails to meet some obligation, such as
fulfilling the terms of a contract. The surety bond protects the obligee against losses
resulting from the principal’s failure to meet the obligation.

Question 14

contract a

Answer 14

the fair and equal treatment of bidders in a contract tendering process.
strengthens the protection afforded to those who submit bids in the tendering process. The
Contract A is formed when an RFP is responded to in the form of a valid bid. As many
Contracts A are formed between the owner (person, company or organization tendering the
project) and the bidders as their bids are received. The owner must now deal fairly and
equally with all bidders, and must not show any favouritism or prejudice towards any
bidder(s). In essence, this concept boils down to the right of an individual to have equal
opportunity to be successful with their bid for work.

Question 15

contract b

Answer 15

Contract B is formed when an Owner formally accepts a Bid. Only a single
Contract B is formed between the Owner and the successful bidder. Contract B a marker
at the end of a formalized process of equitable treatment of both bidders and owners.