Construction Management Contract Administration & Procurement 2 — Questions and Answers
Question 1: Which procurement method allows the owner to overlap design and construction phases to accelerate delivery?
- Design-build (Correct answer)
- Design-bid-build
- Construction management at risk
- Integrated project delivery
Correct answer: Design-build
In design-build, a single entity handles both design and construction, enabling concurrent activities that compress the overall schedule.
Question 2: What is a change order in construction contract administration?
- A written amendment modifying the contract scope, cost, or schedule (Correct answer)
- A verbal instruction to change materials
- A subcontractor's request for additional workers
- An owner's directive to stop work
Correct answer: A written amendment modifying the contract scope, cost, or schedule
A change order is a formal written document, signed by authorized parties, that amends the original contract's scope, price, or completion date.
Question 3: A contractor submits a shop drawing for structural steel connections. The architect's approval of this shop drawing:
- Does not relieve the contractor of responsibility for dimensional accuracy (Correct answer)
- Transfers design liability to the architect
- Approves the contractor's means and methods
- Replaces the need for field inspection
Correct answer: Does not relieve the contractor of responsibility for dimensional accuracy
Architect approval of shop drawings confirms design intent conformance but does not transfer the contractor's responsibility for dimensions, quantities, or fabrication accuracy.
Question 4: What is a Substantial Completion certificate used for in construction?
- It establishes the date the project is sufficiently complete for its intended use (Correct answer)
- It releases the contractor's retainage in full
- It certifies that all punch list items are resolved
- It triggers the start of the warranty period for subcontractors only
Correct answer: It establishes the date the project is sufficiently complete for its intended use
Substantial Completion marks the point when the owner can occupy and use the facility for its intended purpose, which also starts the warranty clock.
Question 5: Retainage in construction contracts is best described as:
- A percentage of progress payments withheld to ensure project completion (Correct answer)
- A contractor's profit markup on labor
- The owner's contingency budget reserve
- Payment held for warranty repairs only
Correct answer: A percentage of progress payments withheld to ensure project completion
Retainage, typically 5–10% of each progress payment, is withheld by the owner as financial leverage to ensure the contractor completes all contract obligations.
Question 6: When a contractor encounters unforeseen subsurface conditions that differ materially from the contract documents, they should first:
- Provide written notice to the owner before disturbing the conditions (Correct answer)
- Immediately proceed to remedy the condition and bill later
- Stop all work on the entire project
- Hire a geotechnical engineer without owner approval
Correct answer: Provide written notice to the owner before disturbing the conditions
Most contracts require prompt written notice of differing site conditions before work is disturbed, preserving the contractor's right to a claim for additional costs and time.
Construction Management Contract Administration & Procurement 2
Which procurement method allows the owner to overlap design and construction phases to accelerate delivery?