as the latter does not prevent the contractor from losing money heavily on the venture.
In the days of hard times, when contractors are willing to take work
at low figures, and even below cost, in order to keep their force together,
the public, in general, especially as represented by companies and municipalities, is prone to take advantage of them by insisting that work be let
by the lump sum, and by throwing on the unfortunate "successful bidder"
not only the risk of loss from rising prices of materials and labor and from
unforeseen contingencies, but, also, in many cases, from excess of quantities above those given in the specifications. This is accomplished by
inserting in the latter a most unjust clause compelling each bidder to verify
for himself both the quantities stated and the character of the conditions
described. The bidders, hungry for work, accept this clause without
comment, but with the mental reservation that, in case of hard luck, they
will, by some means or other, obtain extra compensation, even if they
have to carry the controversy into the Courts.
In nineteen cases out of twenty, it is unjust to bidders to ask them to
name a lump-sum compensation for doing work, unless provision is made
for a variation in the quantities of materials on which they tender. If
provision is arranged for such variation, the method of letting is no longer
that of the "lump sum," but reduces to a modification of that of "unit prices."
As before indicated, the latter method is certainly the more logical,
and yet it is far from being entirely fair to the contractor; because, although
it provides against loss through excess above the estimated quantities of
materials, it leaves him open to the possibility of still greater loss through
changing prices, onerous unanticipated conditions, and disastrous happenings beyond his control. Up to a certain point, the client is the proper party to assume the principal risks inherent to the work, provided that the adverse happenings are really unavoidable by the contractor, and that the latter takes every reasonable precaution against disaster or loss. And yet the contractor should not be altogether relieved from the possibility of loss due to hard luck, because such misfortune is often caused by his dilatoriness, which carries the work into an unfavorable season for field operations. The idea, promulgated of late by certain writers, that it is
unjust ever to penalize a contractor, is wrong; because he, like everybody
else in this world, should bear the burden resulting from his own carelessness, negligence, or incompetence. The owner surely has some rights—and this is one of them. A liberal limit of total cost which can be increased
or reduced properly, in order to provide for an increase or decrease in the
estimated total quantities of materials, will prevent the owner from being
excessively overcharged, and still will give the contractor every opportunity to come out whole in any case except that of extraordinary hard luck.
Method C is wholly objectionable to the client, in that it places him entirely at the mercy of the contractor and his men. The allowance
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