The American Institute of Architects’ (AIA) contract documents, which are generally regarded as the construction industry standards, are updated by the organization every 10 years, and the 2017 update released earlier this year contains considerable changes from the 2007 editions.
The changes in the documents directly impact the roles and responsibilities of each of the parties in construction and design contracts. Some of the major owner/contractor changes include:
- New exhibit with comprehensive insurance and bonds provisions that can be attached to many of the AIA owner/contractor agreements.
- Expression provision in the AIA A201-2017 General Conditions addressing the rights of the contractor and the obligations of the owner in the event of a loss on the project if there is no property insurance procured.
- New provisions relating to direct communications between the owner and contractor.
- Revised provisions pertaining to the owner’s obligation to provide proof that it has made financial arrangements to pay for the project and the contractor’s rights related thereto.
- Simplified provisions for the contractor to apply for, and receive, payments.
- Single Sustainable Projects Exhibit that can be used on any project and added to most AIA contracts to address the risks and responsibilities associated with sustainable design and construction services.
Some of the major owner/architect changes include:
- Sustainable Projects Exhibit, as noted above under the owner/contractor changes.
- Agreements contain a fill point to prompt the parties to discuss and insert an appropriate “Termination Fee” for terminations for the owner’s convenience.
- Architect is no longer required to re-design for no additional compensation if they could not have reasonably anticipated the market conditions that caused the bids or proposals to exceed the owner’s budget.
- Services beyond “Basic Services” and identified at the time of agreement are now categorized as “Supplemental Services,” to avoid confusing them with “Additional Services” that arise during the course of the project.
- Agreements clarify how the architect’s progress payments will be calculated if compensation is based on a percentage of the owner’s budget for the work
All professionals in the construction and design fields who utilize the AIA contract documents should consult with highly qualified and experienced legal counsel in order to gain a full understanding for the changes in the 2017 revisions and their ramifications. In addition, below is a helpful one-hour online video presentation on the new documents from the organization.