TC - SECTION 5: LEGAL RELATIONS AND PROGRESS

TC-5.01 INSURANCE

In addition to the provisions of GP-7.14 (Liability Insurance), the following shall apply on Administration Contracts.

The Contractor shall maintain in full force and effect third party legal liability insurance necessary to cover claims arising from the Contractor's operations under this agreement that cause damage to the person or property of third parties. The insurance shall be under a standard commercial general liability (CGL) form endorsed as necessary to comply with the above requirements and the other requirements of this Section. The State of Maryland shall be listed as an additional insured on the policy. The limit of liability shall be no less than $1 000 000 per occurrence/$2 000 000 general aggregate. The insurance shall be kept in full force and effect until all work has been satisfactorily completed and accepted.

When specified in the Contract Documents or otherwise required by law, the Contractor shall carry the type and amounts of insurance in addition to any other forms of insurance or bonds required under the terms of the Contract and these Specifications.

All insurance policies required by this Section, elsewhere in the Contract Documents, or otherwise required by law, shall be kept in full force and effect until all work has been satisfactorily completed and accepted. The Contractor shall be responsible for the payment of all deductibles or self-insured retentions.

All insurance policies required by this Section, elsewhere in the Contract Documents, or otherwise required by law, (other than Workers’ Compensation Policies) shall include endorsements:

(a) Stating that the State of Maryland is an additional insured with respect to liability arising from the Contractor's operations under this agreement that cause damage to the person or property of third parties.

(b) Stating that such coverage as is provided by the policies for the benefit of the additional insureds is primary and any other coverage maintained by such additional insureds (including self-insurance pursuant to the Maryland Tort Claims Act) shall be non-contributing with the coverage provided under the policies.

(c) Containing waivers of subrogation with respect to all named insureds and additional insureds.

(d) Stating that the insurer has the duty to adjust claims and provide a defense with regard to such claims made against the additional insured.

All insurance policies required by this Section, elsewhere in the Contract Documents, or otherwise required by law, (including Workers’ Compensation Policies) shall be endorsed to state that the insurer shall provide at least seven days notice of cancellation or nonrenewal to:

Maryland Department of Transportation State Highway Administration

Director, Office of Construction

7450 Traffic Drive

Hanover MD 21076

Evidence of insurance shall be provided to the Administration at the address listed above prior to the award of the Contract by means of a Certificate of Insurance with copies of all endorsements attached.

Any policy exclusions shall be shown on the face of the Certificate of Insurance or provided with the Certificate of Insurance.

Certificates of Insurance shall comply with all requirements of the Maryland Annotated Code, Insurance Article, § 19-116. Certificates of Insurance shall be on a form approved by the Maryland Insurance Commissioner (Commissioner). Standard Certificate of Insurance forms currently adopted for use by the Association for Cooperative Operations Research (ACORD) or the Insurance Services Office (ISO) are deemed approved by the Commissioner and are acceptable. Outdated ACORD or ISO forms (those with a revision date prior to the date of the form currently adopted for current use by ACORD or ISO) are not acceptable. The Contractor shall ensure that all required Certificates of Insurance satisfy all requirements of § 19-116 of the Insurance Article, including the prohibition against the issuance of any certificate of insurance that contains false or misleading information or that purports to amend, alter, or extend the coverage provided by the policies referenced in the certificate.

The Certificate of Insurance shall be accompanied by a document (a copy of State License or letter from insurer) that indicates that the agent signing the certificate is an authorized agent of the insurer.

No acceptance and/or approval of any Certificate of Insurance or insurance by the Administration shall be construed as relieving or excusing the Contractor, or the Contractor’s Surety from any liability or obligation imposed upon either or both of them by the provisions of this Contract or elsewhere in the Contract Documents.

The cost of the insurance will not be measured but will be incidental to the Contract lump sum price for Mobilization. If an item for Mobilization is not provided, the cost of the insurance will be incidental to the other items specified in the Contract Documents.

Contractor and Railroad Public Liability and Property Damage Insurance shall be provided as specified in TC-6.05.

TC-5.02 NOTICE TO PROCEED AND PROJECT SCHEDULE

Within 45 days after the Contract has been executed, the Administration will issue to the Contractor a Notice to Proceed. This notice will stipulate the date on or before which the Contractor is expected to begin work. No work shall be started before receipt of the Notice to Proceed.

The requirement of GP-8.04 (Progress Schedule) to submit a progress schedule within 30 days after Notice to Proceed is modified as follows:

Unless otherwise specified, on Administration projects the proposed project schedule shall be submitted within 14 days after receiving the Notice of Award. The Contractor shall not begin work on the project until the project schedule is approved by the Administration. However, time charges shall begin no later than the time stipulated in the Notice to Proceed.

TC-5.03 SUBCONTRACTING AND SUBCONTRACTORS

In addition to the provisions of GP-8.01 (Subcontracting), the following shall apply on Administration Contracts:

The subcontractors named in the Contractor's bid and approved by the Administration and those approved when subsequently submitted shall perform the Contract items as approved by the Administration. Requests for permission to sublet, assign, or otherwise dispose of any portion of the Contract shall be in writing and include the item number or numbers and the dollar value. The Contractor shall give assurance that the minimum wage for labor, as specified in the Contract Documents, shall apply to labor performed on all work sublet, assigned, or otherwise disposed of.

When a subcontractor has been approved by the Administration for the performance of specific items of work on the Contract, the Administration will not allow the Contractor to substitute another subcontractor, except in the event the Contractor requests in writing that the approved subcontractor be relieved of the necessity of performance of the work. Any change of subcontractors shall be requested in writing by the Contractor and shall have the written concurrence of the previously designated subcontractor. Concurrence shall not be unreasonably delayed, in the judgement of the Administration.

If a subcontractor does not perform to the satisfaction of the Contractor, the Contractor may request to be allowed to perform the work with its own forces or request that another subcontractor, mentioned by name, be substituted. When reasons submitted for the substitution of the subcontractor indicate that the change will be in the best interest of the Administration, approval of the request will be granted.

Roadside production of materials, unless performed by the Contractor, shall be considered as subcontracting. This shall be construed to mean the production of crushed stone, gravel, or other materials by means of portable or semi portable crushing, screening, or washing plants, established or reopened in the vicinity of the work for the purpose of supplying materials to be incorporated into the work on a designated project or projects.

The purchase of sand, gravel, crushed stone, crushed slag, batched concrete aggregates, ready mix concrete, or other materials produced at and furnished from established and recognized commercial plants, together with the delivery of the materials to the site of the work by the producer or by recognized commercial hauling companies, will not be considered as subcontracting.

Prompt Payment Subcontractors. The Contractor shall promptly pay a subcontractor any undisputed amount including retainage to which the subcontractor is entitled for work under the Contract within 10 calendar days of receiving a progress, semi final, or final payment in conformance with the latest edition of the State Finance and Procurement Article, §15-226, Annotated Code of Maryland.

The Administration has established the following time frame for subcontractor payment: When a progress, semi final, or final payment is processed and payment is received by the Contractor, payment shall be made to all subcontractors within 10 calendar days.

Each month, the Construction Project Engineer (CPE) will review the current pay items with the Contractor and all involved subcontractors to ensure that all work satisfactorily completed in conformance with the Contract Documents is included in the monthly progress payment. For payment purposes, the same quantity totals used to compute the payment to the Contractor will be the basis for payment to the subcontractor.

If the Contractor withholds payment from a subcontractor beyond 10 days, the Contractor shall:

(a) Notify the subcontractor in writing and state the reason why payment is being withheld; and

(b) Provide a copy of the notice to the CPE and the District Engineer.

If the subcontractor does not receive payment within the required 10 days, the subcontractor shall give written notice of nonpayment to the CPE and the District Engineer.

The notice shall:

(a) State the name of the Contractor, the Contract Number, and the amount in dispute.

(b) Provide an itemized summary on which the amount is based; and

(c) If known, provide an explanation for any dispute concerning payment by the Contractor.

The CPE will then notify the Assistant District Engineer, Construction (ADE) of the dispute. The ADE will verbally contact the Contractor within two business days to ascertain whether the amount withheld is an undisputed amount.

If the ADE determines that a part or all of the amount withheld is an undisputed amount, the ADE will instruct the Contractor to pay the subcontractor the undisputed amount within three business days. The instructions will be confirmed in writing.

The ADE will verbally communicate to the subcontractor the results of the discussion with the Contractor and confirm the results in writing.

If the Contractor fails to pay the subcontractor the undisputed amount within the specified three business days, the subcontractor may report the nonpayment in writing to the ADE.

Upon receipt of notification of nonpayment from the subcontractor, the ADE will schedule a meeting to verify and discuss the nonpayment issue. This meeting will be held at the District Office no later than 10 calendar days after receiving notice from the subcontractor.

Invited to this meeting will be the Contractor, the subcontractor, the ADE, and the CPE. The purpose of this meeting will be to establish why payment was not made to the subcontractor in the required time period. If it is determined that the Contractor is delinquent in payment to the subcontractor, further progress payments to the Contractor may be withheld until the subcontractor is paid.

If payment is not made to the subcontractor within seven business days after the ADE determines that the Contractor is delinquent in paying the subcontractor and the next progress payment becomes due, the progress payment will not be processed and a second meeting will be held at the District Office to address the dispute. The second meeting will be held no later than five business days after the close of the seven-day period. If the results of this second meeting reveal that payment to the subcontractor continues to be delinquent, the ADE may order a suspension of work based upon the failure of the Contractor to carry out the provisions of the Contract or the ADE may allow work to continue and withhold future progress payments as stated above.

In addition, the Administration may require the Contractor to pay a penalty to the subcontractor, in an amount not exceeding $100 per day, from the date the payment was directed to be made by the ADE.

A penalty will not be imposed for any period that the ADE determines the subcontractor was not diligent in reporting nonpayment in conformance with the Contract Documents. The Contractor to whom an instruction or order is directed shall comply with the instruction or order.

The Contractor shall notify the CPE when payment has been made to the subcontractor. The CPE will verify the payment with the subcontractor to ensure payment was received.

A Contractor or subcontractor may appeal the decision of the District Engineer to the Procurement Officer in conformance with GP-5.15 (Disputes). The Procurement Officer will render a final decision on this issue in conformance with GP-5.15 (Disputes) and the contractor shall comply with the Procurement Officer's decision.

An act, failure to act, or decision of a procurement officer or a representative of the Administration, concerning a payment dispute between a contractor and subcontractor under this chapter, may not:

(a) Affect the rights of the contracting parties under any other provision of lay; or

(b) Be used as evidence on the merits of a dispute between the Administration and the contractor or the contractor and the subcontractor in any other proceeding.

A decision of the Administration under these Terms and Conditions is not subject to judicial review or the provisions of COMAR 21.10.04.

Any administrative costs incurred by the Administration will be deducted from the Contractor’s retainage at the conclusion of the project.

Nothing in this provision will prevent the subcontractor from pursuing a claim with the surety under the Contractor’s payment bond at any time.

TC-5.04 CULTURAL RESOURCES

The Contractor shall be aware of the potential of cultural resources on the project. During the construction phase, whenever anything that might appear to be a cultural resource of a historical, archeological, or paleontological nature is encountered, such an object shall not be disturbed. Work shall be stopped and rescheduled in a way that shall avoid not only the objects but also the area of discovery, and the Engineer shall be notified at once. The Engineer will arrange for the evaluation of the situation by the appropriate authorities and for the ultimate disposition of the matter, taking the evaluation of the situation by the appropriate authorities into consideration.

TC-5.05 DETERMINATION AND EXTENSION OF CONTRACT TIME

The Contractor shall complete the work contracted for in an acceptable manner within the number of working days, calendar days, or calendar date as specified in the Invitation for Bids.

The Engineer will make available to the Contractor each week a record showing the number of days charged to the Contract for the preceding week. The Contractor will be allowed one week in which to protest and 30 days in which to file a written statement, setting forth in what respects time charges are incorrect.

If satisfactory fulfillment of the Contract with extensions and increases authorized under GP-4.04 (Variations in Estimated Quantities) and changes specified in the General Provisions require the performance of work in greater quantities than specified in the Invitation for Bids, the Contract time allowed for performance may be adjusted based on the quantities, cost, and the nature of the work involved.

The Contractor, under certain conditions, may be granted permission or be ordered to suspend operations as defined in GP-8.07 (Suspension of Work) on working day Contracts. If the Contractor elects and is permitted to do any work, the time charged shall bear the same ratio to the total time allowed for the completion of the work, as the value of the work done during such time bears to the total value of the Contract. However, the resultant number of days to be charged for any particular month will never exceed the number of calendar days for that month, excluding Saturdays, Sundays, or official holidays on which no work was performed on a controlling item.

Time used in performing work of an emergency nature ordered by the Engineer for the convenience of the traveling public or for the production or delivery of materials for storage, if performed during the period of suspension, will not be charged against the Contract time.

Following the date on which all work has been completed, except those landscaping items on which work is restricted to specified seasons and when inspection and acceptance for maintenance is being deferred pending completion of those landscaping items on which work is not permissible at the time because such work is currently out of season, and for no other reason, no time will be charged against the Contract until such time as it is again permissible to proceed with such work. However, time will be charged during any extensions of the specified season that may be granted the Contractor.

Request for extension of Contract time shall be submitted in conformance with Sections 109 as specified in the Contract Documents.