Legal Glossary
A | B | C | D | E | F | G | H | I | J | K | L | M | N | O | P | Q | R | S | T | U | V | W | X | Y | Z
A
Acceptance: When a party agrees to the terms of a contract; Approval of construction work.
Act of God: An unpredictable event, that is beyond the control of the parties that are in an agreement, which deems the contract resolution impossible or illegal.
Ad Damnum: A clause that alleges the amount of damages from a loss.
Ad Valorem: A tax imposed on the value of a property; calculated at a percentage rate.
ADR: Alternative Dispute Resolution; regards negotiation, mediation, and arbitration.
Adulteration: The addition of unwanted materials to a construction project.
Adverse Possession: Occupation of a real property by right of some claim which opposes a claim from another claimant.
All-Inclusive Deed of Trust or Mortgage: A trust deed or mortgage which includes financing; a payment is made to an all-inclusive mortgagee who in turn makes payments for the included loan; also known as a Wraparound Deed of Trust or Mortgage.
Architectural Fee: The architect's charge for professional services that are required for the services provided for the construction project.
Attorney-in-Fact: A person acting on the behalf of another's power of attorney.
Arbitration: The initiation of a dispute to a chosen person and the relegation of the award to the judgment of a court decision.
Authorized Person: A person whom holds authority to perform responsibilities through specific conditions; normally, regarding a contract.
B
Bidding Documents: Proposed contract documents that are issued before receiving bids for construction.
Bill of Costs: A statement that contains taxable costs and disbursements.
Bill of Particulars: Facts that are produced by a claimant following a request by an adverse party that either clarifies or explains charges and or facts that were alleged in a pleading.
Brief: A document that is prepared by lawyers in a dispute which is then returned to the court. The brief describes the legal support for which the lawyer claims the purpose of representation.
Building Code: The rules that are set down by a local government which define the standards of quality for construction in a community.
Building Inspector: A public official that is employed to examine construction work and determine whether local regulations were met.
Building Official: The official that holds the responsibility of performing the administration and enforcement of building codes.
Burden: The difference of monies required to cover overhead.
Business Entity Concept: The abstract concept of a business being separated from the owners' personal financial interests.
C
Capital Gain or Loss: The financial gain or loss that results from a capital asset's sale or disposition.
Cause of Action: Reason(s) for bringing a lawsuit against another.
Caveat Emptor: "Buyer Beware" A warning to purchase at your own risk
CGL Insurance: Comprehensive General Liability Insurance.
Civil Engineer: An engineer that works on public construction projects.
Clerk of the Works: An old term for an architects' representative. Currently referred to as an architect's project representative.
Commercially Acceptable Standards: The acceptable standard for a work product produced by a tradesman, contractor or worker.
Compensatory Damages: The calculated amount of damages that are awarded to a party for losses that were caused by another party.
Competitive Bidding: The concept of two or more contractors placing bids on a contract at the same time in order to secure a contact.
Completion of Construction: The acceptance of the completion of a construction contract.
Comprehensive General Liability: An Insurance policy that covers comprehensive general liability.
D
Decree: An order of the court.
Defendant: The party that is accused of a legal offense.
Demise: The transfer of a property by either will, grant, or lease.
De novo: To start over; a new trial.
Depreciation: The rate of decline in the valuation of a property.
Design Development Phase: The standard procedure in the design process. The phases are generally: Schematic Design Phase, Design Development Phase, Construction Documents Phase, Bidding or Negotiation Phase, and Construction Phase-Administration of the Construction Contract.
Direct Job Overhead: Job expenses that are incurred during the construction phase.
Discovery: The process where a party to a legal action provides facts to another party regarding requested evidentiary documents.
Dismissal: The termination of a legal proceeding.
E
Easement: The exclusive right of a person to use a real property for a given purpose.
Eminent Domain: The right of the government to obtain private property for public use.
Engineering Fee: The cost for an engineering professionals services.
Environmental Impact Report: A report that details the effects which may result from a property development project, and delineates a proposal to minimize the impact; may also be known as an Environmental Impact Assessment.
Errors and Omissions Insurance: Insurance which is provided to indemnify clients of architects and engineers from possible losses that may be caused from an act of negligence on part of an architect or engineer.
Escrow: A neutral party that follows the direction of instructions for the parties of a transaction.
Estoppel: Doctrine which states that a person may not take a differing representation of prior statements.
Exclusive Right to Sell: An agreement that is made with a real estate broker that if a the property is to be sold during a specified period, then the transaction will be made through that broker or that broker will receive commission for the sale of the property.
Exemplary Damages: Damages which are given to one that files against a defendant in a civil matter.
Ex Parte Proceeding: When a party appears in a court proceeding in the absence of the second party.
F
Fee Simple: When one has a total interest in a real property.
Fiduciary Relationship: A binding relationship of trust between an agent and a principal.
Field Engineer: An engineer that works out in the construction or "field", opposed to one that works in an office environment.
Financial Leverage: Using borrowed monies to increase the return on an investment.
Foreclosure: A legal action that rescinds legal rights.
G
General and Administrative Expenses: An area of an income statement that lists the expenses that are not specifically allocated to an individual part of a construction project.
General Conditions: A document which is provided with the specifications, that determines the rights, responsibilities and the requirements of the architect, contractor and the property owner.
General Partnership: The joining of two or more parties whom share in the operation and responsibilities of running a business.
Gross Errors: Errors that are easily identified due to the extremity of the problem.
Gross Leasable Area: The total amount of area that is available to lease to tenants.
Guaranteed Maximum Price: A set maximum amount that is payable to a contractor for a construction project regarding the specified work.
H
Hearing: A legal proceeding where the evidence of a matter is taken to determine the facts of a case.
Hearsay: A testimony that was given by a witness that has not personally witnessed the statement or facts, yet has heard from another person a testimony of a fact.
I
Implied Covenant: A promise that is not expressed in a contract, but that is implied from the surrounding circumstances.
Implied Indemnity: An obligation to indemnify that arises not from the words of a contract, but from the circumstances of the parties.
Implied Warranty: A guarantee or warranty that is established as a result of a condition or a purchase of a sale.
Improvements: Generally enhancements that are made to a property and the buildings or structures of the development such as additions, paving, fencing and property landscaping.
Income Approach: A method of appraising real estate where an income stream is capitalized.
Indemnity: An occlusion from liability or financial responsibility for a loss.
Indirect Overhead: The administrative and operational expenses that accrue for a construction project which are not directly attributable to the projects' expenses.
Injunction: An order of the court to initiate a party to either stop or start an action.
Instructions to Bidders: Instructions contained in the bidding documents for preparing and submitting bids for a construction project.
Intangible Assets: Non-physical assets such as stock certificates, bonds, trademarks or patents.
J
Joint Venture: A limited duration project that is undertaken by two or more persons in order to achieve a specific business objective.
Judgment: A determination of the court that follows a legal proceeding.
Judicial Settlement: A court proceeding where a financial settlement for a fiduciary is adjudicated by the courts.
Jurisdiction: The area, location and limitations of the court.
L
Labor and Material Bond: A bond which guarantees that a contractor will receive payment for services and or materials.
Liability: A legal obligation for amounts owed, incurred expenses, or monies paid for services or materials that were not yet delivered; legally obligated.
Lien: A claim that is submitted against the property of another for security against a debt.
M
Malicious Prosecution: The pursuit of another party for an unjustified cause.
Maintenance: Ongoing activities or costs which are required for the performance and operation of a development or construction project.
Market Data Approach: An appraisal method whereby the value of a property is determined by examination and comparison of actual real property sales.
Mechanics Lien: A lien that is filed against a property to secure payment for services or materials that were provided by a contractor.
Memorandum Decision: A brief statement that is provided by the court which set's out a courts decision.
Miscellaneous Taxes Payable: Taxes that are owed to local and State agencies over an accounting period.
Motion: A request to make a decision on a legal matter.
Mutual Assent: An agreement that is shared between two parties.
Mutuality: The binding of two or more parties to the conditions of a contract.
N
Negligence: Failure to act with imprudence or exercise due care.
Negotiable Instrument: A promissory note or document that retains a cash value that may be traded or exchanged by the bearer of the document.
Negotiated Contract: An agreement that is reached between two contractors instead of issuing a bid.
Net Working Capital: The current assets minus liabilities.
Non-recourse Mortgage: A mortgage where the borrower holds no personal liability.
Notice of Cessation: A document that is written by an owner of a property which specifies that there has not been labor performed on a project for a determined period and states the amount of time allowed before lien rights are exercised.
Notice of Completion: A written notice filed by an owner that signifies the completion of a real property of real property development.
Notice of Non-responsibility: A written and posted document that if properly constructed and recorded, provides a relief of liability from a mechanics lien for a real property or real estate development.
Notice to Pay Rent or Quit: A notice that is issued prior to an eviction.
Notice to Proceed: A notification given to a contractor to assert the work of a contract.
O
Oath: A swearing to tell the honest truth regarding a statement; if the statement is later proved to be false in a court of law then the person may be subject to perjury.
Occupancy Importance Factor: A Code that is used to determine the importance of the occupancies.
Oral Agreement: An agreement that is not committed in the form of a written document.
Order: A decision that was provided as a written document.
Owners Overall Budget: The specified amount that is allocated by the owner of a projects' total cost.
Owners Right to Stop Work: The statement in a construction contract that defines whether the owner has rights to stop a project and the justifiable circumstances for such an event.
P
Partisan Arbitrator: An arbitrator that is appointed by a party in a dispute.
Partnering: A business relationship where the partners seek to work in a mutually accepted vision.
Payback Period: The amount of time required to recover a real estate investment.
Peculiar Risk Doctrine: A ruling that states that an owner may not escape liability for injuries that happen to employees on a construction project just because the workers are Independent Contractors.
Peer Review: A professional review of the quality of work that was performed by a professional.
Percentage Lease: An agreement where the amount of rent is negotiated as a percentage of the sales.
Performance Bond: A security bond that ensures that a contract will be performed by a contractor.
Performance Code: A code that determines the objectives which are sought out rather than the material and specifications.
Power of Attorney: A legal instrument that authorizes one to act as the agent of another; the agent is called an attorney in fact, but does not have to be a licensed attorney.
S
Seasoned Loan: A loan that has continued to carry an acceptable record of payments for a period of time.
Second Trust Deed: The second trust deed that is established following the first deed.
Sinking Fund: A pool of money that is reserved for the use as a debt management tool for bond issues.
Site Development: Work that is performed on a construction project which is on the real property development area.
Specific Performance: The accuracy of compliance with the terms and conditions of a contract.
Specialty Contractor: A contractor that specializes in handling a unique and specific area of contracting.
Specification Code: The building code where the allowed and required materials that are used in a construction contract are detailed.
Statute of Frauds: A statute that specifies the contracts that are to be in writing.
Statute of Limitations: The time period which a cause of action must be filed before a plaintiff loses the right to do so.
Statute of Repose: A limitation that is set which measures the time from the completion of work.
T
Tax Shelter: To offset investment gains by charges for the sole purpose of avoiding income taxes.
Termination for Cause: The termination of a contract by an owner or contractor due to the commission of specific acts by the opposing party to a contact.
Termination for Owners Convenience: The right that an owner holds to terminate a contract for a reason that is to the owners convenience.
Topographic Survey: A land survey which defines all of the features of a geographic location.
Trial: An examination of a controversy that is held in court to define an issue.
U
Undercapitalized: Not having enough capital for an operation.
Unencumbered Property: A property that is free and clear of any liens, debts, or standing obligations.
Uniform Building Code: A code that is written by the International Building Officials Conference which has been accepted by many local governments as the official model for their building code.
V
Value Engineering: An analyzation process where costs and the value of the materials and procedures are evaluated.
Venue: The physical location where a legal matter is assigned to be determined.
Verification: The validation of the accuracy of the authenticity of a statement, oath pleading or legal instrument.
W
Work Product Exclusion: An insurance provision which withholds the amount of coverage for destruction to work that has been performed by the insured party.
Working Drawings: Construction documents that are used for the development of a structure.
Z
Zone: A specific area that is for use in a determinate matter; residential, commercial, or industrial.