Contract Terms definition.docx

7/27/2019 Contract Terms definition.docx

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9. Change orderAlso: Contract Modification

The document that alters the contract amount, contract time, or contract requirements of the original

contract entered into by the owner and a contractor.

10.Punch listA punch list is a list of tasks that need to be completed to satisfy the terms of aconstruction contract.

Such lists may be included in the contract itself, but more commonly, they are generated in the final

phases of construction, as people walk around the site and note down any issues and deficiencies that

need to be resolved. They are very useful for project management, whether people are dealing with a

contractor or doing the work themselves, because it's easy to miss small details which can be

problematic later.

The term punch list is a reference to the fact that people used to punch a hole in the paper next to

tasks which had been completed. Today, these lists may be managed as simple written checklists, or

even in electronic form. Electronic ones are very convenient because they can be distributed to many

people and may be updated instantly, allowing everyone to see progress. This can be especially

important when multiple contractors need to address the same issue.

11.Liquidated damagesAn amount, specified in a contract for construction, tocoverdamages incurred by the owneras a

result of thecontractor's failure to complete the workwithin the timeframe set forth in the contract.

12. Invitation to bidA written notice of an owner's intention to receive competitive bids for a construction project wherein

aselect group of candidate constructors are invited to submit proposals.

13. Instructions to biddersA document included as part of the bidding requirementsthat sets forth specific instructions to

candidateconstructors on procedures, expectations and disclaimers of the owner, and other necessary

information for the preparation ofproposals forconsiderationby the owner for a competitive bid.

14.Lump sum contractA type of construction contract requiring the general contractor to complete a building or project for a

fixed cost normally established by competitive bidding. The contractor absorbs any loss or retains any

profit.

15.Unit price contractA construction contract in which payment is based on the workdone and an agreed on unit price. The

unit price contract is usually used only where quantities can be accurately measured.

16.ClaimA contractor's request for additional compensation or an extension of time pursuant tothe contract terms.
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A formal notice sent by a contractor to an owner asserting the fact that the terms of the contract have

been breached and compensation is being sought by the contractor from the owner.

17.Performance BondA performance bond is a surety bond issued by an insurance company or a bankto guarantee

satisfactory completion of a project by a contractor.

For example, a contractor may cause a performance bond to be issued in favor of a client for whom

the contractor is constructing a building. If the contractor fails to construct the building according to

the specifications laid out by the contract (most often due to the bankruptcy of the contractor), the

client is guaranteed compensation for any monetary loss up to the amount of the performance bond.

18.AddendaSupplementary documentation issued prior to the contract award that changes or clarifies information

stated in the bidding documents.
http://en.wikipedia.org/wiki/Surety_bondhttp://en.wikipedia.org/wiki/Insurancehttp://en.wikipedia.org/wiki/Bankhttp://en.wikipedia.org/wiki/Independent_contractorhttp://en.wikipedia.org/wiki/Contracthttp://en.wikipedia.org/wiki/Bankruptcyhttp://en.wikipedia.org/wiki/Bankruptcyhttp://en.wikipedia.org/wiki/Contracthttp://en.wikipedia.org/wiki/Independent_contractorhttp://en.wikipedia.org/wiki/Bankhttp://en.wikipedia.org/wiki/Insurancehttp://en.wikipedia.org/wiki/Surety_bond

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Contract Terms definition.docx