TEC 226 EXAM 1 QUESTIONS AND ACCURATE
ANSWERS
Why does an owner want an independent contractor? - Answers - An owner often
prefers an independent contractor because it shifts responsibility and risk away from the
owner while ensuring the work is done by a professional
The Slow Method can cause adversarial relationships, why? - Answers - It's the result of
slow decision making, can also lead to unclear communication about project goals
Owners like a few things about design, bid, build... what are they? - Answers - This
method gives the Owner a reasonable idea of the final cost of the project before the
construction phase
What's the payment scheme for project deliveries that don't have plans? - Answers -
Cost Plus: Actual construction costs (labor, materials, equipment, subs) + a fee for the
contractor (either a fixed fee or percentage)
Does the CM agency have the same risk as the CM at risk? - Answers - No, the CM is
viewed as an "agent" of the owner. The agency has no risk
What should the owner get out of involving a contractor earlier? - Answers - The owner
gets more accurate cost estimations, better constructability, reduced risk, and faster
project delivery
What's "Consideration"? - Answers - Basically, payment after a completed project
No formal agreement, what agreement is formed? - Answers - Estoppel (principle by
which a contract becomes binding with no contract signed)
What's an assignment clause? - Answers - Basically, states who can control the
contract
2 different ways you can be ___ legally, 1 is an agent the other is what? - Answers -
The Principle; someone who's legally responsible for the contract
If someone's hurt on a project, is the owner liable? - Answers - If there is a private
contractor no
If a worker isn't independent, what do they lose? - Answers - If they're an employee,
they're not protected by workers comp, no minimum wage, may have no viable legal
recourse to address grievances. Many states have begun to use legislation to penalize
ANSWERS
Why does an owner want an independent contractor? - Answers - An owner often
prefers an independent contractor because it shifts responsibility and risk away from the
owner while ensuring the work is done by a professional
The Slow Method can cause adversarial relationships, why? - Answers - It's the result of
slow decision making, can also lead to unclear communication about project goals
Owners like a few things about design, bid, build... what are they? - Answers - This
method gives the Owner a reasonable idea of the final cost of the project before the
construction phase
What's the payment scheme for project deliveries that don't have plans? - Answers -
Cost Plus: Actual construction costs (labor, materials, equipment, subs) + a fee for the
contractor (either a fixed fee or percentage)
Does the CM agency have the same risk as the CM at risk? - Answers - No, the CM is
viewed as an "agent" of the owner. The agency has no risk
What should the owner get out of involving a contractor earlier? - Answers - The owner
gets more accurate cost estimations, better constructability, reduced risk, and faster
project delivery
What's "Consideration"? - Answers - Basically, payment after a completed project
No formal agreement, what agreement is formed? - Answers - Estoppel (principle by
which a contract becomes binding with no contract signed)
What's an assignment clause? - Answers - Basically, states who can control the
contract
2 different ways you can be ___ legally, 1 is an agent the other is what? - Answers -
The Principle; someone who's legally responsible for the contract
If someone's hurt on a project, is the owner liable? - Answers - If there is a private
contractor no
If a worker isn't independent, what do they lose? - Answers - If they're an employee,
they're not protected by workers comp, no minimum wage, may have no viable legal
recourse to address grievances. Many states have begun to use legislation to penalize
