Client Relations & Contract Administration Flashcards
7 cards from real CRC practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Client Relations & Contract Administration flashcards as text
A client requests a scope reduction mid-project to lower costs. The contractor should:
Answer: Execute a written deductive change order reducing the contract price accordingly
A deductive change order formally documents reduced scope and adjusts the contract price, protecting both parties from future disputes.
Which type of contract provides the greatest cost certainty for a residential homeowner?
Answer: Fixed-price (lump sum) contract
A fixed-price contract establishes a set total cost for defined scope, giving the owner maximum budget certainty as long as the scope does not change.
When a contractor discovers hidden conditions (e.g., buried tanks) that significantly increase costs, the proper action is to:
Answer: Stop work, notify the owner in writing, and negotiate a change order
Differing site conditions clauses require prompt written notice to the owner so the parties can evaluate the impact and negotiate equitable compensation.
A homeowner wants to make payments directly to a subcontractor to speed up work. The general contractor should:
Answer: Refuse and explain that direct payments to subs can create lien and contract complications
Direct owner-to-subcontractor payments can undermine lien waiver processes, create double-payment risks, and violate the privity of contract structure.
Which document provides an owner assurance that the subcontractors and suppliers have been paid, thus reducing lien risk on the property?
Answer: Conditional lien waiver
Conditional lien waivers from subs and suppliers, exchanged for each payment, demonstrate that those parties have been paid and waive their lien rights accordingly.
Under a residential construction contract, who typically bears the risk if material prices increase significantly after contract signing?
Answer: The contractor, under a fixed-price contract
In a fixed-price contract, the contractor assumes the risk of material price escalation unless the contract contains an escalation or price adjustment clause.
A Notice of Commencement in Florida must be recorded before:
Answer: The first labor or materials are furnished to improve the property
Florida law requires the Notice of Commencement to be recorded before the first work or materials are delivered so lien rights attach from that date.