Engineering Management

ROHIT

Engineering
Management
Part 2: Project Contract

Submitted by: Submitted to:1

Engineering Management
ROHIT

Rohit Harchand (150000722)

Samson Mudapakati
Three types of contracts are:Type of Contract
Fixed price/Lum
sum

Cost
reimbursable/Cost
plus

Time and material

Advantage
Contractor can make
profit if it takes less
manpower and material
in project than
anticipated
Contractor does not need
to worry about the cost of
material and other
uncertain risks

Disadvantage
Contractor may get loss if he
underestimate the cost of
project

Contractor will be paid

hourly rates

The client will only pay for

actual time worked to
contractor

Contractor can not make the

extra profit through work ,he
will only pay for work
completed

Q:-When does a Defects Notification Period for the Contract Works begin? How long is
the Defects Notification Period?
Ans:- Defects notification period for the contract begins immediately after competition
of project and it lasts for 12 months
Q:-State the dual role of an Engineer in the administration of contracts?
Ans:- The dual role of an engineer in contract is that he has to be in interaction with
contractor and client on the regular basis to supervise the contractor and to consult
with client about project progress
Q:-Who appoints the Engineers Representative?
Ans:- An engineer itself appoints his representative
Q:-How does a contractor appoint a subcontractor?
Ans:-A contractor appoints his subcontractor to do some specific tasks in project
Q:-What is a Working Day?
Ans:-A day in which one usually work means theres no Sunday or public holiday
2

Engineering Management
ROHIT

On your recent visit to Pokeno (to finalise the Project Management Plan I suppose!)
you came across your high school friend who is planning to purchase a stand in
Pokeno and build a house. Your friend has just got approval for a Kiwi saver Home
Start Grant and has the necessary finances to purchase a residential stand in Pokeno
and build a new home. However there are some eligibility criteria that must be met
when buying land to build a home according to Housing New Zealand. Your friend
wants the following advice from you:
a) The appropriate type of contract to enter into with the builder?
Ans:- Fixed price contract would be better
b) The total maximum allowable cost of the contract (i.e. both cost of building the
home and the land) if they are going to apply for a Welcome Home Loan?
Ans:-$ 495000 NZD

References
http://www.hnzc.co.nz https://emit.manukau.ac.nz/webapps/blackboard/content/listContent.jsp?
course_id=_107614_1&content_id=_1097127_1&mode=reset