FMT203_Procurement and Contract Management_SU3

A contract is an agreement between 2 or more parties and is intended to be enforceable by law.

• True

• False

The purpose of contract is to _______. (You may choose more than one answer)

• regulate disputes

• penalise the defaulting parties

• enforce the promise of another

• discourage unscrupulous parties from offering 2nd rated services

The doctrine of privity of contract states that _________.

• a third party can take court action against the contracting parties

• a third party cannot take court action against the contracting parties

• the contracting parties can take court action against a third party

• only the client can can take court action against a third party

The essential ingredients of a valid contract are ___________. (You may choose more than one answer)

• offer and acceptance

• consideration

• intention of create legal relationships

• Rejection

Terms can be expressed or implied.

• True

• False

Which of the following is NOT an objective of contract management?

• Ensure the contract is delivered on time.

• Ensure the contract is delivered at the right place and right quantity.

• Ensure the contract terms are fair and open to the contracting parties

• Ensure the contract is completed according to contract requirement.

Which of the following should be avoided when making change orders (or variations)?

• Approve and evaluate the quote before work commences.

• Evaluate the cost after work commences.

• Identify the risk invovled in making the change.

• Identify the change order implication on work progress.

Performance measurement is necesary to determine the service providers' performance against the agreed service levels. Measurement should be based on financial aspects only.

• True

• False

When Party A transfers his rights and obligation to a third party, the process is known as ______.

• subcontracting

• assignment

• subletting

• novation

______ is a security or protection against a loss or other finanicial burden.

• Indemnity

• Guarantee

• Force majeure

• Retention of title