TCM 320 Exam 1

Civil Law

laws derived from a codified "written" system of law

1. Legislation is the primary source of law

Common law

laws derived from centuries of judge's decisions hearing real cases, "judge-made" laws

1. Previous cases take precedent and are the primary source of law

Types of common law

- contract

- property

- criminal

- tort

- wills and trusts

- evidence

Case citation format

1. Name of the case (parties involved)

2. Volume

3. Reporter (7 regions for state, 2 primary federal)

4. Page

5. Court

6. Date

Laws applicable to construction

1. contract law (K)

2. Statutory/Regulatory

3. Tort law

Types of liability

- contract

- statutory

- tort

- strict

- absolute

Contract Liability

exposed to liability by signing "k"

1. liability results when a party breaches the contract by not following "k" provisions

example: interfering with another party's ability to perform the work

Types of Contract Liability Provisions

1. Express contract provisions - plainly written in contract

2. Implied Contract provisions - implied warranties, Based upon custom and practices and case law

Statutory liability

imposed by law or statute

Example: violation of building codes

Types of statutory liability

1. expressed - clearly stated or codified

2. implied - customary

Tort Liability

can be exposed to tort liability by intentional or unintentional "civil wrongs"

example - unintentional damage to someone's property

Note - if the act was intentional, then criminal liability is possible

Strict liability

used in terms of tort liability, but may be used for other types

1. not necessary to prove fault or negligence to establish responsibility

example - warranty repair for roof leak

Absolute Liability

related to performance of "ultra-hazardous" construction activities

example - demolition, blasting

- standard of care not taken into consideration

- only consideration is if damage actually occurred

Elements of a Contract

1. Offer

2. Acceptance

3. Consideration - quid pro quo

4. Legality

5. Capacity

OACLC

Defenses to contract formation

1. genuineness of assent

2. required form

Distributive Negotiation

Fixed pie, win-lose, zero-sum.

negotiation/bargaining strategy used to distribute a fixed sum

the goal in distributive bargaining is:

1. to assure you are the sole winner

2. your side should win, no matter what the cost to the other party

Integrative Bargaining

"interest-based bargaining" or "win-win"

looking for ways to increase the pie

General negotiation tactics

- use two negotiators who play different roles

- invoke law or justice

- be tough

- use irrationality

- RAISE your demands as the negotiations progress

- state that you do not have the authority to compromise

- clear the agreement with "home office" before signing

- create false bottom lines

- use throw-away issues

- Fiat Accompli

- use of threat

- intimidation

- nibble

- draftsmanship game

- because you are my friend

- split the difference

- flip-a-coin

Fiat Accompli

Something that has been done and cannot be altered

creating a footprint in the sand

5 elements of principled negotiation

1. separate the people from the problem

2. focus on interests rather than positions

3. invent options for mutual gain

4. insist on using objective criteria

5. know your BATNA

Project Delivery Methods

1. Traditional DBB

2. Construction management

- agency

- at risk

3. Design Build

Traditional DBB

- Most common U.S. delivery method

- Owner has individual contracts with the AE and GC

- Sequential, linear process

Construction Management

- CM assumes some responsibilities of owner and others

- CM could be an Arch, GC or professional CM

CM-Agency

early consulting and may coordinate building trades. Typically provides services for a fixed fee, assumes no risk for construction costs, acts as an agent of the owner

CM-At risk

CM plays role of advisor during design, transitions to more GC during construction, generally gives owner a GMP for construction

Design-Build

- Single-point responsibility

- One contract for design and construction

- owner is hands off in regard to design

Methods/terms of payment

Methods/terms of payment (commercial terms of the contract)

For AE:

o Usually % of cost of work

o May be fixed price

o May be hourly

For contractors:

o Usually, fixed price

o May be reimbursable

o May be cost plus fee

o May be guaranteed maximum price (GMP)

Typical Documents in the Contract:

1. Bidding and contractual documents/forms

2. Conditions of the contract

a. General conditions

b. Supplementary conditions

3. Technical provisions

4. Drawings

5. Reports of investigations of physical conditions

3 parts of Specifications

1. General

2. Products

3. Execution

General Specifications

- Description of the work

- submittals

- inspection requirements

Products Specifications

- what the materials are

- does not discuss workmanship in this part

Execution Submittals

- how to install the material

- approved methods

- does not cover materials fabricated by others

Construction Drawings

Reports of Investigations of Physical Conditions:

- Soil borings are MOST COMMON

- weather records

- stream flow hydrographs

Labor agreements

- Wages and labor costs

- Jobs and income security

- Health care

- Pensions

- Health and safety

- Quality and productivity

Understanding Red Flag Clauses

- union security

- union jurisdiction

- hiring hall

- grievance

- work stoppage/lockout

- subcontracting

Union Security Provision

o Union membership is a condition of employment

o Illegal in "right to work" states

Union Jurisdiction Provision

o Provides terms of the work performed

o Details extent of geographical region for agreement

Hiring Hall Provisions

o Union is exclusive source of referrals to fill job openings

o Different provisions in different areas and with different trades

Grievance Procedures

Method for resolving disputes between contractors and the union

Work stoppage/lockout provision

o Require unions to continue work while a dispute is being resolved (no work stoppage)

o Requires contractor to continue to offer employment to union workers during a dispute (no lockout)

Subcontracting Clause

o Forces contractors to hire subs who will agree to the terms of the contractor's labor agreement

o Does not require subs to sign a union agreement but requires them to make payments into the union trust fund

How to calculate burden in hours-worked

Union trust fund receives:

o Total hours worked (hrs.) X Fringe rate ($/hour)

o Health care, pension, vacation, etc.

How to calculate burden in hours-paid:

o Similar to hours-worked, but overtime hours are counted as 1.5 hours (or 2 hours) per actual hour worked

"Time is of the essence"

- Usually found in all contracts

- Simply means that contractor is required to complete project by specified time without delays

- Contractor's may try to include language that states "time of the essence" for owner responsible items

o Payment of invoices

o RFI answers

o Submittal review

- May also be construed against the owner if they are responsible for causing the delay to the progress of the work

"No damage for delays" clause

- Contractors relief in the event of a delay (for any cause whatsoever) is limited to an extension of contract time only

Strict exculpatory

- declare that someone is not guilty of wrongdoing clause that many courts do not enforce

- May be viewed as a contract of adhesion

Float

amount of additional time, or contingency, in a contractor's fixed completion schedule that is over and above what he believes is actually needed to finish the project, provided everything goes according to plan

- Typically, the contractor owns the float unless they give it away in the contract terms

3 types of delays

Excusable Delays:

1. non-compensable excusable delays

2. Compensable excusable delays

3. Non-excusable delays

Non-compensable Excusable Delay

Contractor entitles to extension of project time only

Compensable Excusable Delays

Contractor entitled to both additional money and time extension

Non-Excusable Delay

May include weather, acts of God, and labor problems.

Delays for which the contractor is responsible

Ways in which acceleration can occur:

- voluntary

- directed

- constructive

Acceleration

completion of the contract work or part of the contract work at a more rapid rate than required by the contract

Voluntary Acceleration

elected acceleration by the CONTRACTOR to either reduce time related costs by accelerating the work pace or to make up for unexcused delays to get the work back on the contract schedule

Directed Acceleration

completion of contract work at a pace that is faster than would ordinarily be required pursuant to a directive from the OWNER

Constructive Acceleration

a forced completion of the contract work in a shorter period than should have been allowed by the issue of proper contract time extensions

How to prove constructive acceleration:

4 elements:

1. entitlement to time extension - contractor must be permitted in the contract to extra time

2. failure of owner to issue time extension - either no time extension was issued, or time extension was issued unreasonably late

3. proof of extra costs - contractor must prove that extra costs were incurred in attempting to finish the project by the original time

4. completion before date to which contract should have been completed

Components that make up the Construction Documents

SAMSDOG:

Specifications

Addenda

Modifications

Special Conditions

Drawings

Owners Agreement

General Conditions