No Slide Title - Part 1 - Legal Aspects... · •Architect’sproposal letter •Subconsultant’sbinding letter. ... Supplementary Conditions ... • A business & marketing tool

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ARCHITECT’S CONTRACTS

Charles GreenbergPractice Advisor, OAA

Charles Simco, Shibley Righton LLP

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IN THIS SESSION

• What are Architect’s Contracts

• Standard Contracts

• Non-Standard Contracts

• OAA 600, 800 & 900

- Preparing

- Important Clauses

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ARCHITECT’S CONTRACTS

• Clent / Architect OAA

• Architect / Consultant OAA

• Construction Contract CCDC

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Standard Architect’s Contracts

• OAA 600 Client/Architect

• [OAA 601 separate services]

• OAA 800 Short form

• OAA 900 Architect/Consultant

• Licensed Technologists OAA

OAA 602, 603, 801, 901

• Architecture Canada /RAIC - 6,7,8 & 9

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Non-Standard Contract Forms

• Client’s Custom Contract

- Government or Private Sector

• Client’s Supplementary Conditions to change the Standard OAA contract

• Architect’s custom contract

• Architect’s proposal letter

• Subconsultant’s binding letter

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Use Standard Contracts !

• they have legal input

• prepared by your profession

• have stood the test of time

• they are regularly updated

– to reflect changes in practice

– in law and

– in custom

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HERE THEY ARE:

600

800

900

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OAA 600

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OAA 800

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OAA 900

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KNOW THESE TWO!

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OAA 600

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Instructions &

Commentary

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CONTRACT PARTS

A. AGREEMENT

B. DEFINITIONS

C. GENERAL CONDITIONS (GCs)

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AGREEMENT

A.1,2,3 date, Client, Architect

A.4 Project

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AGREEMENT

A.5 owner

A.6 Client’s budget

A.7 anticipated dates

A.8 anticipated construction contract

A.9 “can rely on” A.6, 7 & 8

client & architect

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AGREEMENT

A.10 shall coordinate services of

Consultants

.1 engaged by the Architect

.2 engaged by the Client

Note: GC 8.5 ...Nothing in this clause shall

derogate from the Architect’s duty of Consultant

Coordination.

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AGREEMENT

A.11 Fees

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21not in 601

GC 2 Basic Services

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AGREEMENT

A.12 % of fee per phase

A.13 admin. % on reimbursements

A.14 mileage

A.15 retainer

A.16 payment of invoice

A.17 interest

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DEFINITIONS

• Contingency (1), (2) & (3)

• Consultant Coordination

• General Review

• Instruments of Service, Electronic

Documents (copyright - CAD)

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GENERAL CONDITIONS

GC 1 Architects Responsibilities

• professional skill and care

• expediously

• consultant coordination

• key personnel

• conflict of interest

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GC 2 & 3 SCOPE OF SERVICES

GC 2 Basic Services

GC 3 Additional Services

3.1 Common

3.2 Unforeseen

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GC 2 Basic Services

not in 601

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SCOPE OF SERVICES

read the words carefully:

“Assist”, “Based on”, “Report”, “Review”,

“Advise”...

2.1.18 Assist – permits

2.1.19 Bids – review and report -(Do not Recommend)

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• 3.1 Additional Services

• tenant related designs

• rendering, models, photography

• multiple bid packages

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• 3.2 Unforeseen

• inconsistent instructions

• significant scope changes

• change in anticipated dates

says - compensation at hourly rates in

A11 or as agreed

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GENERAL CONDITIONS

GC 4 Client’s Responsibilities

GC 5 Budgets, Estimates &

Construction Cost

GC 6 Construction Phase Services

GC 7 Copyright

GC 8 Liability of Architect

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GENERAL CONDITIONS

GC 9/10 Suspension & Termination

GC 11 Payments to Architect

GC 12 Misc.

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GENERAL CONDITIONS

GC 13 Other Terms of Contract

e.g. “...as described in _______ attached

to this contract.”

• get legal advice for changes (call PAS)

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OAA 900-2014

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OAA 900-2014

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OAA 900-2014

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OAA 900-2014

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Non –Standard Contracts

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Architect’s Own Custom Contract

• Seldom contains the balanced, protective

clauses (for both parties.)

• Argued that big contracts offend and intimidate the client (the same clients who lost their being intimidated by launching litigation action!)

• Not always compatible with other documents (e.g. CCDC construction contracts between Owner and Contractor.)

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“Client’s Standard” or

Supplementary Conditions

• Often prepared by Client’s legal counsel seeking to shift balance of risk to Architect.

• If forced into a non-standard OAA or RAIC Contract for Architectural Services - consult your own legal counsel and your insurer before signing.

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Beware of Double Jeopardy clauses:

• Architect will hold Client harmless from all defects.

• Architect will ensure that the building is built in complete conformance with all applicable codes, regulations, bylaws,

etc. of all authorities having jurisdiction.

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• Architect will apply for and obtain building permit and other applicable releases from Authorities Having Jurisdiction.

• Architect will obtain LEED certification.

• And any other things a client might want

you to ensure.

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• Ensure means warranty or guarantee

• Insurance or indemnity policies do not

cover you guaranteeing things.

• So – you can be sued, if you cannot

deliver, but you are not covered

because you agreed to a guarantee

(hence the double jeopardy.)

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Use a WRITTEN Contract

• Discuss expectations & obligations

• Reach an accord

• Record the agreement – the contract

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Use STANDARD Contracts

• Prepared for you

• Balanced and fair to both parties

• Can be tailored

• Compatible with CCDC

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Do not rely on ORAL agreement

• no protection for either party

• biggest source of escalation: simple

disagreement > dispute > legal >

claim >complaint

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Avoid hybrid forms of contracts

• Transfers risk in non-traditional ways.

• Letter agreement.

• Client’s standard contract or Client’s

Supplementary Conditions

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OAA 600 and Commentary

• A business & marketing tool

• Reviewing GC 2.1 & 3.1 shows the

breadth and value of services

• Discussion is your investment

• Minimizes “scope creep”

• Maximizes convergence of

expectations

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Other References:

• RAIC - Fee Guide

• RAIC CHOP 2.1.9 Risk Management

and Professional Liability

• OAA website, Practice Tips, Contracts

Experience:

• Learn during employment –

• Call OAA Hotline

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