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Construction Engineering 380

Construction Engineering 380. Chapter 13 Owner Obligations. Owner Obligations. Fee structure is determined by the project needs A variety of compensation methods are legally valid Cost and time methods Multiple of direct salary expense Multiple of direct personnel expense

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Construction Engineering 380

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  1. Construction Engineering 380 Chapter 13 Owner Obligations

  2. Owner Obligations • Fee structure is determined by the project needs • A variety of compensation methods are legally valid • Cost and time methods • Multiple of direct salary expense • Multiple of direct personnel expense • Professional fee plus expense • Hourly rates

  3. Owner Obligations • Project attribute methods • Fixed sum • Percentage of total project cost • Multiple of billings • Square footage • Unit cost • Royalty

  4. Owner Obligations • Additional services and reimbursables can add to fee basis • Compensation (fee) should be based on risk, owner attitudes, and technical difficulty • Payment schedules are articulated in the contract: • interim • packages • monthly • late

  5. Owner Obligations • Failure to perform is usually considered a material breach and cause for damage recovery • Prevention or hindrance (owner won’t answer questions required to complete design) does not prevent recovery • Unjust enrichment and forfeiture are well-established legally (process is clear)

  6. Owner Obligations • Procedure for completion of design in alternative delivery or fast-track is not as clear • Financial exigency • Bankruptcy • Repudiation • Unwillingness or inability to perform (death of a partner)

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