LARE EVALUATION EXAM 2026 QUESTIONS AND
SOLUTIONS RATED A+
✔✔Comparative negligence - ✔✔the legal doctrine that wrongdoers should pay
damages proportional to their fault
✔✔Exculpatory Clause - ✔✔a provision in a contract that relieves a party of liability
✔✔Indemnity - ✔✔a promise to hold a person harmless from liability or loss
✔✔Latent defect - ✔✔a construction defect that is not perceptible by ordinary
observation
✔✔Lis Pendens - ✔✔a document recorded in the county recorder's office that gives
public notification of litigation involving title to or the possession of real property
✔✔Main factors which lead to negligence - ✔✔Lack of interpersonal relationship skills,
poor communication, faulty problem solving, faulty administrative decision making.
✔✔Most effective ways to avoid negligence - ✔✔Good relationship skills, effective
communication, routine proper business procedures.
✔✔Arbitration - ✔✔settlement of a potential claim by an impartial panel of
knowledgeable experts
✔✔Mediation - ✔✔a meeting between parties in a dispute which is facilitated by an
impartial third party. The mediator attempts to get the parties to a mutual resolution, but
has no power to make an enforceable decision.
✔✔Limits of Liability - ✔✔when a design professional acts in good faith on behalf of a
client, such professional would establish a reasonable assumption of liability in
proportion to their free. In order to use this concept it should appear in the design
contract.
✔✔Liability Insurance - ✔✔protects against large monetary claims due to claims of
negligence.
✔✔Business Record Keeping - ✔✔Best chance to avoid legal issues. This includes
written records, chronological documentation of all decisions, instructions, changes,
progress check points, inspection results. Must be authentic and clearly part of routine
business.
, ✔✔General liability insurance - ✔✔the most basic type of commercial insurance. Limit
to liability claims of bodily injury or property damage. Cover is provided for accidents at
your place of business or customers location.
✔✔Professional Liability Insurance (errors and omissions insurance) - ✔✔protects
against loss from a claim of alleged negligent acts. This might include client data, claims
of non performance or negligence.
✔✔Workers Compensation Insurance - ✔✔required by regulation in most states when a
business has W2 employees. Ir provides medical and disability coverage for on-the-job
injuries or work related illness.
✔✔Employment practices Liability Insurance - ✔✔covers allegation of discrimination,
wrongful termination and sexual harassment of employees.
✔✔Fidelity or Commercial Dishonesty Bond - ✔✔provides coverage when an employee
steals money, equipment or other assets from a firm or its clients.
✔✔Force Majeure - ✔✔Circumstances that is beyond the control of one of the parties to
a contract and which may, according to the terms and conditions, relieve that part of
liability for failing to execute the contract.
✔✔Invitation to bid - ✔✔a brief description of the project and timeline for the bid period.
Describes where to obtain contract documents, fees and documents to be submitted.
✔✔Instruction to bidders - ✔✔detailed requirements for the bidders.
✔✔Bid Form - ✔✔forms to be filled out and submitted by the contractor which lists the
base bid price, any alternatives and the price for each, provisions for additional work,
signatures and certifications by the officers of the contract.
✔✔Bid Bond - ✔✔assures that the contractor will agree to the contract if his proposal is
accepted. If he does not, the bond is forfeited to the owner. The form states the amount
of the bond and is signed and sealed by both a responsible office of the contracting firm
and a responsible officer of the surety firm.
✔✔Performance Bond - ✔✔assures that the contractor will complete the work in
conformance with the contract requirements (per bid bond)
✔✔Standard General Condtions - ✔✔large section (30 pages or more) which sets out in
great detail the requirements for execution of the work. Referred to as boiler plate since
they are usually uniform through state or local/government agencies.
SOLUTIONS RATED A+
✔✔Comparative negligence - ✔✔the legal doctrine that wrongdoers should pay
damages proportional to their fault
✔✔Exculpatory Clause - ✔✔a provision in a contract that relieves a party of liability
✔✔Indemnity - ✔✔a promise to hold a person harmless from liability or loss
✔✔Latent defect - ✔✔a construction defect that is not perceptible by ordinary
observation
✔✔Lis Pendens - ✔✔a document recorded in the county recorder's office that gives
public notification of litigation involving title to or the possession of real property
✔✔Main factors which lead to negligence - ✔✔Lack of interpersonal relationship skills,
poor communication, faulty problem solving, faulty administrative decision making.
✔✔Most effective ways to avoid negligence - ✔✔Good relationship skills, effective
communication, routine proper business procedures.
✔✔Arbitration - ✔✔settlement of a potential claim by an impartial panel of
knowledgeable experts
✔✔Mediation - ✔✔a meeting between parties in a dispute which is facilitated by an
impartial third party. The mediator attempts to get the parties to a mutual resolution, but
has no power to make an enforceable decision.
✔✔Limits of Liability - ✔✔when a design professional acts in good faith on behalf of a
client, such professional would establish a reasonable assumption of liability in
proportion to their free. In order to use this concept it should appear in the design
contract.
✔✔Liability Insurance - ✔✔protects against large monetary claims due to claims of
negligence.
✔✔Business Record Keeping - ✔✔Best chance to avoid legal issues. This includes
written records, chronological documentation of all decisions, instructions, changes,
progress check points, inspection results. Must be authentic and clearly part of routine
business.
, ✔✔General liability insurance - ✔✔the most basic type of commercial insurance. Limit
to liability claims of bodily injury or property damage. Cover is provided for accidents at
your place of business or customers location.
✔✔Professional Liability Insurance (errors and omissions insurance) - ✔✔protects
against loss from a claim of alleged negligent acts. This might include client data, claims
of non performance or negligence.
✔✔Workers Compensation Insurance - ✔✔required by regulation in most states when a
business has W2 employees. Ir provides medical and disability coverage for on-the-job
injuries or work related illness.
✔✔Employment practices Liability Insurance - ✔✔covers allegation of discrimination,
wrongful termination and sexual harassment of employees.
✔✔Fidelity or Commercial Dishonesty Bond - ✔✔provides coverage when an employee
steals money, equipment or other assets from a firm or its clients.
✔✔Force Majeure - ✔✔Circumstances that is beyond the control of one of the parties to
a contract and which may, according to the terms and conditions, relieve that part of
liability for failing to execute the contract.
✔✔Invitation to bid - ✔✔a brief description of the project and timeline for the bid period.
Describes where to obtain contract documents, fees and documents to be submitted.
✔✔Instruction to bidders - ✔✔detailed requirements for the bidders.
✔✔Bid Form - ✔✔forms to be filled out and submitted by the contractor which lists the
base bid price, any alternatives and the price for each, provisions for additional work,
signatures and certifications by the officers of the contract.
✔✔Bid Bond - ✔✔assures that the contractor will agree to the contract if his proposal is
accepted. If he does not, the bond is forfeited to the owner. The form states the amount
of the bond and is signed and sealed by both a responsible office of the contracting firm
and a responsible officer of the surety firm.
✔✔Performance Bond - ✔✔assures that the contractor will complete the work in
conformance with the contract requirements (per bid bond)
✔✔Standard General Condtions - ✔✔large section (30 pages or more) which sets out in
great detail the requirements for execution of the work. Referred to as boiler plate since
they are usually uniform through state or local/government agencies.
