Contracts, Ethics, and Professional Practice
What the exam tests
Contracts, ethics, and professional practice tests contract formation and administration, standard forms, notices, variation and payment mechanics, and professional conduct. Expect scenario questions on instructions, time bars, and conflicts of interest.
Core rules and concepts
- Common contract types: lump sum, re-measurement, and cost plus; each allocates quantity and price risk differently.
- Standard forms such as FIDIC and NEC set notice periods; failing to notify within the stated period can bar a claim.
- Variations must be instructed by the authorised person; valuation uses contract rates where applicable and a fair valuation where they are not.
- Payment is certified against the contract mechanism, with retention held until the defects liability period ends.
- Ethics: disclose conflicts of interest, keep client information confidential, refuse improper gifts, and record decisions honestly.
- Oral instructions should be confirmed in writing promptly.
Worked example
An engineer instructs an extra 120 m³ of concrete, and the contract rate is $45/m³. The valuation is 120 × 45 = $5,400, provided the work is within the variation mechanism. The contractor must give the required notice within the stated period; if the notice is late, the entitlement may be time-barred even though the work was genuinely instructed. The reasoning separates entitlement (was there an instruction and a valid claim) from valuation (what is it worth), which examiners test as two distinct steps.
Traps that cost marks
- Missing a notice time bar.
- Acting on an oral instruction without written confirmation.
- Valuing a variation without checking whether a contract rate applies.
- Failing to disclose a conflict of interest.
- Confusing retention with a performance bond.