Obligations of a Contract

7. Owner can purchase materials if he so desires.—The reservation to the owner to purchase materials if he so desires has been discussed above.

8. Owner can have excavations and founda tions completed while plans for superstructure are being drawn.—Because it is not necessary to have all plans carefully laid out before the con tract is ready, it is true that the owner can have excavations and foundations completed while the finished plans for the rest of the work are being drawn; and where a building is burned down, and has to be replaced at the earliest pos sible moment without waiting for preliminary drawings and specifications, which generally take time, this feature is a tremendous blessing to the owner.

9. Owner, engineer, or architect can make changes or alterations at any time without delay ing the work.—This proposition is not true, since, after a contract has been signed on the old-fashioned basis, practically any changes that would delay the work would produce delays under the cost plus a fixed sum contract, al though often it would not be possible to know just how much these delays amounted to. Changes in plans after work has been well start ed, almost invariably result in delays and inter ruptions.

10. Owner can have any number of skilled and carefully trained mechanics on this contract at a moment's notice.—This is rather obscure.

If the owner can have any number of skilfully trained mechanics at a moment's notice under this form of contract, the method by which it is accomplished is not known to the writer.

11. As contractor's profit is the same re gardless of the cost of work, there is no incentive for contractor to produce anything but substan tial and economical work.—This is perfectly true, and is of great value to the owner.

12. Owner has his building completed as rapidly as is consistent with good workmanship.

—It is difficult to see how this proposition differs under a "cost plus a fixed sum" contract from under a "lump sum" contract. On the lump sum basis the contractor is just as anxious to finish his work and get his profit as on any other basis.

13. Owner or his authorized representative has access at all times to all matters pertaining to the work.—The owner, or his authorized rep resentative, as a general proposition, has access at all times to all matters pertaining to the work under any form of contract.

14. Owner can pay bonuses for speedy de livery of materials.—This advantage is usually true under any form of contract, and is not pe culiar to the form at present under discussion.

The arguments for this form of contract from the contractor's point of view, outlined by the same authority, are substantially as follows: 1. Contractor has opportunity to earn upon his own merit an enviable position in the busi ness world's confidence.—Under this form of contract the contractor is in a sort of quasi-pro fessional position; and in so far as he makes good and obtains a reputation for efficiency and reliability, does he advance.

2. Profit assured.—There is no question on the part of the contractor as to how much money he is going to make; he takes no risk, and is not under any mental worry or strain of any kind so far as finances go, and he therefore is in a position to spend as much time as he desires to further the interest of the owner and further his own reputation. Not being worried about his profit and the cost of the work, it stands to reason that he is not going to be as strenuous as he otherwise might be.

3. Contractor free from relations with own ers who have not the courage to take legitimate risks attendant upon their own enterprises, and who wish to saddle them upon a contractor upon a lump sum basis and leave him to gamble his way out as best he can.—The contractor under this form of contract is not likely to get into a poker game with a dishonest owner, wherein the owner may succeed in obtaining more than his money's worth at the contractor's expense.

4. Contractor has satisfaction of dealing with an owner who has no reason to suspect him of over-reaching, who is not in constant dread of extortionate charges for "extra work," and who has a contract offering complete insight into the financial affairs of the job.—We might add a fifth advantage—which is, that under the pecu liar features pretty thoroughly discussed above, the contractor is in a position to keep his own overhead charges down to the very minimum. All the contractor's fixed expenses which he can not charge to his owner, are the expense of ad vertising, and his traveling expenses while hunt ing for new work, so that the fixed sum or per centage that he gets is always all clear profit, without risks of any kind.

Attention should be called in this connection to the fact that when a contractor has lump sum work and cost-plus-a-fixed-sum work at the same time, he is likely to put his best men upon the lump-sum work and let the cost plus work take care of itself so far as efficiency is concerned.

Finally, it appears that, in the last analysis, taking all the facts into consideration, the cost plus-a-fixed-sum contract is simply a contract for superintendence with the burden and the re sponsibility upon the owner. However, if the owner can have some method of insuring that he can properly supervise the contractor's work and keep him up to the mark in efficiency, this form of contract (cost plus a fixed sum), when the work is to be done in a hurry or under con ditions which cannot easily be laid down in his specifications, will accomplish results which are utterly impossible under the lump sum system.