X.

St. Sewer, S..

N. Y.,

Engineer's Certificate No. 4,

Dated Mar. 3, 1912.

(II) (Assuming lump sum contract and addressed to the Owner.)

of G..

for building a

As provided in the contract entered into Jan. 3, 1912, between yourself and Mr. C... . . . . . . . . . M . . . . . . . concrete wall around your estate, I have this day measured the work completed by him to date and certify as follows, viz:

Other methods of bookkeeping would bring the same result. In these illustrations the percentage is deducted before deducting the previous payA blunder would result if the sequence were reversed.

ments.

(A) At the end of each calendar month the Engineer will make an approximate measurement of all the work done and material delivered up to that date, classified according to the items mentioned in the contract, and will make an estimate of the value of the same on the basis of the unit prices named in the contract. To the estimates made as above set forth will be added the amounts earned for extra work to the date of the progress estimate. From the total thus computed a de

(the Owner)

duction of ten (10) per cent will be made and from the
remainder there will be further deducted any amount
due to
... from the Con-
tractor as damages for delays or otherwise under the
terms of the contract. From the balance thus deter-
mined will be deducted the amount of all previous pay-
ments and the remainder will be paid to the Contractor.
The ten per cent deducted as above set forth will
become due and payable to the Contractor upon com-
pletion of the work to the satisfaction of the Engi-

neer.

(B) Payment for the work embraced in the contract shall be made in the following manner: a payment will be made, on or about the first of each month, of ninety (90) per centum of the value of the work completed by the Contractor on the fifteenth of the previous month and not previously paid for, as estimated by the Engineer; allowance will not ordinarily be made the Contractor by the Engineer, in his estimates, for materials that are not in place, i.e. that are not in finished portions of the work which is in an unfinished condition; allowance may be made for all excavation done each month, and for materials delivered on the work when, in the opinion of the Engineer, such allowances are justified; provided, however, that the making of such payments may be deferred from month to month, when, in the opinion of the Engineer, the value of the work done since the last estimate for payment is less than three hundred dollars ($300); provided, further, that nothing herein contained shall be construed to affect the right, hereby reserved, of ... (the Owner) to reject the whole or any portion of the aforesaid work, should the certificate be found or known to be inconsistent with the terms of the contract or these specifications, or otherwise improperly given.

....

58. Conditions of Final Payment.

(a) When the work is finished and the Engineer, after a thorough inspection, is satisfied that it is complete and in ac cordance with plan and specifications in every detail, he issues his final certificate.

The following will serve to show how such a certificate might be worded. It may be addressed either to the Contractor or the Owner.

N..

has

concrete wall around the estate of Mr. B.... been completed according to the plans and specifications therefor and to my satisfaction, and that you are entitled to payment as follows:

(b) On the basis of this certificate a payment is made to the Contractor in an amount shown by the certificate, namely the balance due on the contract, less the percentage, which latter is still held for a period prescribed by the specifications, generally 30

* The extra work may or may not be mentioned in this certificate. †The 15 per cent would be due at a later date, as August sixth. See Art. 57.

days. This is to guard against liens,* and gives the Owner opportunity to inquire at the office where liens are recorded and assure himself that no liens are in force against the work or against any materials used therein. Some specifications require the Contractor to secure and furnish to the Owner a certificate stating that the official records show no outstanding liens affecting the case, making this a condition precedent to his receiving the payment of the retained percentage.

(A) The said Contractor shall not be entitled to demand
or receive payment for any portion of the aforesaid
work or material except in the manner set forth in the
contract and these specifications until said work shall
have been completed in accordance with the terms
hereinbefore mentioned and the Engineer shall have
given his certificate to that effect; whereupon

(the Owner)
will within seventy days after
said completion and the delivery of said certificate pay
or cause to be paid to the said Contractor in cash the
whole amount of money then, due the said Contractor
under the contract excepting such sum or sums as may
lawfully be retained under any of the provisions of
the contract hereinbefore set forth.

(the Owner)

(B) The Engineer shall, as soon as practicable after the
completion of the work under this contract, make a
final estimate of the amount of work done thereunder,
and
shall, within
thirty days after such final estimate is so made, pay
the entire sum so found to be due hereunder, after
deducting therefrom all previous payments, and also
all percentages and amounts to be kept and retained.

* Liens are claims against property for unpaid debts. Originally in common law, a lien gave a workman (a jeweller for example) the right to retain in his possession an article on which he had been working (as a watch) until he had been paid for his work. Common law has been supplemented within recent years in the United States by various State statutes, so that an unpaid workman may have a claim against the work even if it is physically impossible for it to be in his possession. Similar provision is made in favor of men who have furnished materials.

under the provisions of this contract. All prior esti-
mates and payments shall be subject to correction in
the final estimate and payment. The Contractor
shall furnish
(the Owner)
with
satisfactory evidence that all persons who have done
work or furnished materials and are entitled to a lien
therefor under any statute or law of the State have
been fully paid or are no longer entitled to such a lien
before he shall demand any estimate or payments due
or unpaid under this contract, and in case such evidence
is not furnished an amount necessary to meet the law-
ful claims of the persons aforesaid may be retained from
any moneys due or that may become due the said Con-
tractor under this contract until the lawful claims afore-
said shall be fully discharged or satisfactorily secured,
but it is understood and agreed that
(the

Owner) .. assumes no obligations nor in any way
undertakes to pay such lawful claims out of any funds
due or that may become due the Contractor, or out of

own funds.

(the Owner's) 59. Maintenance Clauses. When asphalt pavements were first introduced into the United States (about 1875), engineers knew little of the wearing qualities of the material. Hence originated the custom of requiring of the Contractor a guarantee that his work would last. This practice has since found wide use in connection with pavements of all kinds, and has been to a limited extent applied to other forms of construction.

(a) The security required of the Contractor is either:

(i) A percentage retained during the guarantee period, or (ii) A security bond (smaller of course than the "faithful performance" bond). (See Art. 11.)

Of the two, the former is simpler and more direct, providing as it does a fund on which to draw in case the Contractor refuses to make the necessary repairs.

(b) The objections to requiring maintenance are three: