*
Dave,
I’ve been following this conversation and support you
fully. You have pointed out the level-headed
reasoning behind having contracts. God knows, people
have a way of ‘assuming’ things and then
‘misinterpreting’ things and then all hell can break
loose. I’m designing a house for a best friend of
mine (a lawyer) and I wish to heck we had a contract.
I instead sent him a long letter of understanding
that we are using as an outline. Three quarters of it
was just an education thing letting him know what to
expect and what the phases of design are and how the
whole kit’n kaboodle progresses through completion.
Anyhow, I encourage Richard to review the AIA
contract. There is always room to add clauses or
addenda which address specific problems he has had
in the past. IF, of course, they are dealt with in a
balanced manner. The bottom line is – “What’s fair, is fair.”
Now I’ve gotta go back and read AIA 105 myself.
gg
–
Replies
*
I'm surprised that you or this architect would consider using an A101 contract for this project. It sounds to me like the architect is playing General Contractor if he is planning on contracting the majority of the subs and you are simply providing a limited scope of division 6 work. You should sign a Contractor - Subcontractor agreement with the architect acting as the "Contractor". The make sure that he meets the requirements for acting as a General Contractor.
It is my understanding that when an A101 is entered into - an architect cannot dictate items such as who does the work. It is the "Contractors responsability to execute the work per the contract documents. If you have a contract that states you will complete a job in X amount of time for Y amount of money - and the architect hires his brother-in-law as the plumber, who proceeds to cut a 6" hole in the center of your 8" glu-lam, etc.... You're on the hook because you are the CONTRACTOR. The AIA document protects the contractor by saying - the architect can not pick the subs - of course they can qualify them which can be another fight but they can't pick'em.
*
Rich a few months ago I had the same problem with a contract for work that came across my desk. It was written so one sided that I called and asked if we could meet and review this thing. Short of the story they said no, I said I ain't signing this as it is. Now they have called me back and are asking if we could help them "catch up" and have no problem with changing there contract. Ain't it funny how things turn out?
*Todd,The A101 was definately overkill, and is now a moot point. The architect is actually acting as the owners agent in this case not the G.C.. The owner hired the subs directly. I don't anticipate any problems here with that because with one exception they are subs who I have worked with in the past and are reliable and professional. And I did review the 101 extensively last week and you are right the Architect can't pick 'em or dictate who does what, he or the owner can only disqualify them.RM
*Bill,Sounds familiar...LOL. I think this current boom is helping too. The fact that it's so difficult to get good contractors has possibly elevated our status a little as well. About effing time. Of course its also brought everyone with a hammer and a pickup truck into the business.If I recall correctly though the last time the bottom dropped out so did most of the 'gypsies'. Amazing how many of them are working at H.D. now as "experts"....um...er...not that I go to H.D. or anything. I wish I could find a way to produce all this work. I'm going to have to make several "Can you wait 'til next spring" phone calls this weekend and it really goes against my grain.RIchard Max
*Richard with a little time on my hands and a schedule that is beyond help....... I started looking at contracts and charge order forms that we have. Mostly I happy with them except for having work being pushed back and leaving huge holes in my schedule. Well this one was a blessing with me being out for a few weeks. Mostly contract's have to protect both parties and a lot of them don't. I'll stand behimd what I do all I want is to be paided on time.......Ok done venting now
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As an architect and AIA member for nearly 30 years, I am quite familiar with the AIA documents, but not defensive about them.
Bear in mind that the AIA documents are developed with the involvement of owner and contractor groups. The documents are not written by self-serving architects, but by committees (with all of the problems of that process). They are lengthy because they try to address the multitude of problems that have arisen in the past (i.e. court cases) and changes occuring in the construction industry over time, such as design-build systems.
For example, note that there have been some significant changes in the A201-1997 version. The A201 now clarifies who is responsible when a contractor hires a design professional to do a sub-part of the work (such as designing truss systems.) They have also eliminated liability for the contractor for the owner's loss of use - for example, if the contractor does not get the building done on time, the owner can't sue for the lost profit he hoped to make by selling goods in the building.
Several web sites outline issues related to the AIA documents. Suggest a search on A201 and other such terms to locate articles of interest. Check out http://www.webcom.com/~sabozahn/welcome.html, http://www.e-architect.com/, and http://www.dpic.com/
If nothing else, I suggest using the AIA documents as a checklist against which to measure other alternative agreements and general conditions. If the AIA document covers an issue that could arise, even on a small project, it might be worth including.
Finally, if you use an attorney to review construction-related agreements - get one who knows this business. It is a real specialty.
*
Bill,
I hope your feeling better soon, and back on the job.
I couldn't agree with your last statement more. I think that sums up the essence of the primary obligations of both parties pretty good. It's the niggling little details that the contract and terms or addendums need to address. And don't keep looking at your scheduling board too long, at this point it sounds like a heartbreaker. Make the tough phone calls and move ahead.
juggling 6 balls in the air with only 2 hands,
Richard Max
*Jim,Thanks for the input here. Unfortunately only your last link opened. My main problem with the 101/201 was it was just too much for a project of this size. Commitee or not I do think they are weighted in favor of the owner and architect and would amend at least ten clauses in the 101/201 that I wouldn't be comfortable signing. A lot of this business needs to be based on trust and good faith a contract is there in the event of a breach of that trust. I still would like to review the 105/205 and see if that is more applicable. Does anyone have a copy? I doubt I'm going to find the time to pick one up in the next few weeks.Richard Max
*Bill,I hope your feeling better soon, and back on the job.I couldn't agree with your last statement more. I think that sums up the essence of the primary obligations of both parties pretty good. It's the niggling little details that the contract and terms or addendums need to address. And don't keep looking at your scheduling board too long, at this point it sounds like a heartbreaker. Make the tough phone calls and move ahead.juggling 6 balls in the air with only 2 hands,Richard Max
*
Any one have any opinions on the standard AIA contract?
Specifically A101 and the general notes and provisions A201. This is for a residential remodel/addition in the $160,000 range in which we will be the building/carpentry contractor and all the mechanical and finishing subs are being hired directly by the architect.
It just seems like alot of contract for a job this size. And also seems more heavily weighted toward the owner and architect. I have always thought that the body of the contract was my guarantee of performance and the boilerplate fine print was the owners.
Does anyone else use these things for projects of this size? Last year we built a bank and they didn't require this. Whats everyones feelings on these documents.
Thanks in advance,
Richard Max
*Port,I will not sign an AIA contract. From my point of view, it is simply a way for owners and architects to legally hold you responsible for anything and everything, and a way for them to avoid paying their bills. I walked away from an accepted trim job that was over $200,000 because they expected me to sign one of those. A week later, the owner wound up signing one I wrote up myself when he realized I was serious and would not do the job on an AIA contract.Neither will I sign a contract that has the phrase "time is of the essence" contained anywhere. This is another legal phrase equivalent to "Payday? OK bend over". I do not trust any Construction Management Firm or General Contractor or Owner who feels an AIA contract is necessary, regardless of the size of the job.Subcontractors and GC's have little enough legal protection as it is.If you don't believe me, have a contract lawyer read a Standard AIA (I'm sure he is already well aware of them) and tell you what it means. Shouldn't cost you more than a hundred bucks. Then have him give you a few hints on what to put into your own contract.Good luck,Clampman
*Richard,I'm an Architect, and have to partially agree with clampman on this one. The A101/A201 are intended for large commercial projects, and contain requirements that would be ridiculous for your job. Steer clear.The AIA has model contracts that are intended for smaller projects. You, or the Owner, may want to check into A105/A205, 1993 Edition, Standard Form of Agreement Between Owner and Contractor for a Small Project and General Conditions of the Contract for Construction of a Small Project. It is for use on small projects that will be completed in a relatively short span of time. The basis of payment is a stipulated sum.This is a more reasonable and understandable document. All that it, like the A101/A201, asks is that you plan your work realistically, be aware of all contract requirements, and then perform as agreed. As with any contract, you must read and understand every word before signing. The first time or two, with a contract that you haven't used before, it's a good idea to have a lawyer review it with you.Even the short form contract will have requirements, such as extra paperwork before payment, that create more work and hassle for you. You are entitled to payment for these extra tasks imposed by the contract. Read the contract carefully, add up the extra expenses it requires, include a buffer for items that carry risk for you, and let the Owner know what your price will be under the AIA contract. An...interesting...discussion will probably follow your announcement that the contract will cost him more money. Better to have the discussion now than later. You may end up coming to terms over the AIA contract. You may end up revising the AIA contract to pull out some of the items. You may end up throwing the contract out. In any case, by careful to come to terms before work starts. You'll set the Owner/Contractor relationship off on a good foot.Best of Luck,Dave
*Richard, you have it exactly when you say they are weighted towards the owners, et al. You'd be best not to have any part of these.When discussing contracts in the Const. Mgmt. classes I took, we were warned about these. You may strike clauses or whole sections, but I'd say it is too much paper for that size job.The only winner would be the attorney.
*Yikes! There seems to be some misunderstanding about AIA contracts. Building a house isn't like buying a power tool or ordering dinner at a restaurant. A lot of money will be spent. Misunderstandings can be extremely costly and emotional. The Contractor, Owner, and Architect may not know each other, but must work together smoothly and seamlessly.Everyone needs a road map.A contract, AIA or other, should establish ways to handle typical and unusual project matters. Items covered include things like payments, scheduling, changes, substitutions, inspection, and closeout. After reading the contract everyone knows what is generally expected of them. It's not just for the Contractor, responsibilities are listed for the Owner and Architect too. A contract is a good thing; it protects everyone when well written.Are the AIA documents unfair? I don't think so. They were written by the AIA, but in coordination with the AGC. They were specifically written to assign reasonable responsibility to the party best able to control each important construction issue. A casual read of the AIA contracts might leave you with the impression that they dump on the contractor. After all, his (or her) name appears more often than anyone elses. That is what you would expect (unless you were paranoid) because the Contractor is the party doing the work.Remember that it is fair to adjust your project price depending on the nature of the contract. No shame in that.I suggest that you be the judge. Get a copy of A105/A205, read it carefully, and see what you think. It's written in fairly plain language and is only a dozen or so (if memory serves) pages long. I can list your closest AIA document distributor if you let me know where you live. They don't sell online yet.This $160,000 house is indeed fairly small, but you need to be familiar and comfortable with contracts if you want to advance your business, and the AIA versions are an important industry standard.BTW, AIA contracts KEEP the attorney from winning. After you become familiar with the contract he won't be needed. The project is much more likely to not end up in court since everyone will understand their role. If things do go bad, then the contract will reduce court expenses by having established a fairly clear set of responsibilities. Dispute resolution clauses are an option to specifically keep disagreements out of the courts. No question, AIA contracts have taken money out of attorney pockets and somewhat battled the national trend toward legal mayhem.Contractors intending to cheat or defraud their clients should either avoid contracts or write their own "special" ones. I assume no one here has that intent.
*I really appreciate all your answers guys, keep 'em coming ! Here's a little more information from my end.I have a standard boilerplate of terms and conditions that I use in all my contracts.For whatever reason this has become an issue now with this architect and he would like me to amend it in a way that I believe is unfair, as an alternative he suggested the AIA contract be appended to resolve the matter quickly.I have worked with this architect for years and always found him to be fair in the past. He asked us to bid this job,and got our bid accepted on his recommendation , even though we were not the low bidder. I have used the G703 and G702 certificate of payment forms before and am familiar with the extra paperwork. Toatl project size is probably more in the $250,000 range, the $160,000 is just our end of it.The unusual thing about this whole project is I have not even met the owners yet!!! Usually I have spent many hours with them by this point, but in this case it's all been through the architect. Everyone involved wants to resolve all this on monday and start work on thursday. I will pick up the A105/205 on monday and see if that works better for this project.My attorney hasn't got a chance to review the A101 but will probably do so on monday,I'll have him review the 105/205 as well, he doesn't understand what the problem with my usual terms are, and frankly niether do I. No one else has ever had a problem with them. I know the architect feels he is doing his job ,protecting his client, and I know he's not out to screw me, but as I stated earlier..the body of the contract is thier assurance of what will be done, the terms are my assurance I will be paid for it, and not hung out to dry over by a bad client.Alot of my work is still done on a handshake with people I know and in twenty years I've never had a lawsuit and only been beat for $125.00. I think thats a pretty good record and I don't want to start ruining it now.I'm attaching a copy of my usual terms, anyone use something similar? Suggested additions/deletions?Thanks again for all your opinions, I really appreciate your help. Keep it coming.Richard Max
*I really appreciate all your answers guys, keep 'em coming ! Here's a little more information from my end.I have a standard boilerplate of terms and conditions that I use in all my contracts.For whatever reason this has become an issue now with this architect and he would like me to amend it in a way that I believe is unfair, as an alternative he suggested the AIA contract be appended to resolve the matter quickly.I have worked with this architect for years and always found him to be fair in the past. He asked us to bid this job,and got our bid accepted on his recommendation , even though we were not the low bidder. I have used the G703 and G702 certificate of payment forms before and am familiar with the extra paperwork. Toatl project size is probably more in the $250,000 range, the $160,000 is just our end of it.The unusual thing about this whole project is I have not even met the owners yet!!! Usually I have spent many hours with them by this point, but in this case it's all been through the architect. Everyone involved wants to resolve all this on monday and start work on thursday. I will pick up the A105/205 on monday and see if that works better for this project.My attorney hasn't got a chance to review the A101 but will probably do so on monday,I'll have him review the 105/205 as well, he doesn't understand what the problem with my usual terms are, and frankly niether do I. No one else has ever had a problem with them. I know the architect feels he is doing his job ,protecting his client, and I know he's not out to screw me, but as I stated earlier..the body of the contract is thier assurance of what will be done, the terms are my assurance I will be paid for it, and not hung out to dry over by a bad client.Alot of my work is still done on a handshake with people I know and in twenty years I've never had a lawsuit and only been beat for $125.00. I think thats a pretty good record and I don't want to start ruining it now.I'm attaching a copy of my usual terms, anyone use something similar? Suggested additions/deletions?Thanks again for all your opinions, I really appreciate your help. Keep it coming.Richard Max
*Hi Richard, we're off to check out a portable sawmill this morning. I've printed your terms and message, and will post something later. A few quick notes now. Your lawyer will understand how inappropriate the A101 & A201 are after opening them. No need to read, the fact that the A201 is 30 pages of fine print speaks for itself. I'd be interested in hearing your lawyers reaction to the A105/A205. You may not want to append one contract to the other. Conflicting clauses could make some lawyers wealthy. If required to append, your contract should probably be appended to the A105/A205. The best option is to review both and modify the AIA to meet your needs. More later... Dave
*Richard,I'm back. As I guessed earlier, you may want to use the A105/A205 and add some clauses from your standard contract. Here are some comments on your contract, some which may be shared by your architect.-- The document has more legalese (sp?), and reads with more difficulty, than the 105/205.-- Many of the provisions sound to me like war wounds. It's good to hear that you apparently escaped from the situations without too much financial damage. The 105/205 focuses less on specific problems and more on general responsibility and methods of conflict identification and resolution. That's good because every project has its own new lessons.-- As with any project, review of the documents, inspection of the site, and discussion with the Architect are key to identifying unusual project costs and problems early. Take care with this step, keep a running issues list, and make sure the documents and contract address your concerns before signing.-- I find your contract to be substantially biased toward P.C.; the 105/205 will address all parties in a more balanced manner. If it were my house, I would never agree to clauses number 12 and 18. Do I read 12 correctly that I could sign this contract, have construction loan problems, and end up owing you 25% of the contract amount after you just barely started work? I don't know about NY, but that wouldn't fly around here (SC).-- 18 contradicts the proposed combination of the 105/205 and your contract. I also don't think Owners should not be expected to accept a project without any sort of warrantee.-- One item in 12, preventing trial by jury, is somewhat good. Here's the order of preference, at least around here: best = mediation, bad but acceptable = trial by jury, worst = binding arbitration.I'd be interested in reading your impressions after checking out the 105/205.Take Care,Dave
*Hi Dave,First off I want to thank you again for taking the time to discuss this issue with me. You make several very valid points. -- As far as the legalese, your right and I have always disliked it. I picked up this document (It was not written specifically for me) so many years ago I can't even remember the source. I am going to review the 105/205 and see if I like it better. Either that or have my attorney revamp the present doc. I suspect the legalese will just be a neccesary evil though.-- If it was written from a kicked dog perspective (as may be the case) the war wounds weren't mine. each job is different and I like the idea of a more general outline of responsibilities, however I think that certain specific issues should be clearly stated.--Couldn't agree with you more about the issues list and open lines of communication.-- Of course it's biased toward PC, it's my boilerplate. This part of the contract is the 'Cover your a**' section. Over all when balanced against the body of the contract I think it's a fair and balanced document. I am in total agreement that any contract should be equitable to both parties, and consider myself to be a fair and honest man. You may be reading 12 correctly, I'm not sure, but that situation would never occur because I would not pursue the matter in that case. In any event after speaking with my attorney this morning I struck clause 12 in total. Although it may appear biased toward PC, he actually didn't like it from my perspective, said the liquidated damages might not be fair to me...and anyway was unneccesary.-- Interestingly enough no one else had mentioned or had any problem with 18, but now that you've pointed it out I guess I do. Your right that the way it's written it implies no warranty on the work (Although thats addressed in the body of the contract) I will change that. I take great pride in my work and always warranty it. There have been many instances over the years were I repaired something that wasn't under warranty or suffered subsequent damage that wouldn't even be covered under a warranty, and I went back and fixed it just because it was "my work".-- I agree that mediation is the best option in the event of a dispute. Thanks again for giving me your perspective on all of this. My heart and head were leading my to the same conclusions drawn by clampman and Rich as soon as this issue came up. Everyones been very helpful in supplying thier viewpoints. Anyone have a better boilerplate? Any other thoughts and opinions out there?Richard Max
*Sorry Dave forgot to ask how the sawmill excursion went today. I hope it was what you were looking for.RM
*Clampman,Thanks for your input here. My thinking on this is pretty much the same. I had one large commercial client who tried to shove the "Time is of the essence" thing down my throat once...I told him we both know that, but I won't sign a document to that effect. BTW got that job and produced it on time. I am prepared to walk away from this if they insist on the AIA 101/201, although I'm interested in checking out the 105/205 as Dave suggests. Either way I'm booked into 2000 so I won't be home watching the kids watch Blue's Clues. Thanks again,RM
*Rich,Thanks for your help. I'm curious as to what specifically was objected to in the CM classes you took, as far as the AIA contracts. I spent the better part of friday morning reviewing the 101/201 and came up with about 15 clauses I would strike. They are supposedly written in association with the AGC, but sure don't look like it to me. Do you have a standard boilerplate that you use?RM
*Dave,I've been following this conversation and support you fully. You have pointed out the level-headed reasoning behind having contracts. God knows, people have a way of 'assuming' things and then 'misinterpreting' things and then all hell can break loose. I'm designing a house for a best friend of mine (a lawyer) and I wish to heck we had a contract. I instead sent him a long letter of understanding that we are using as an outline. Three quarters of it was just an education thing letting him know what to expect and what the phases of design are and how the whole kit'n kaboodle progresses through completion.Anyhow, I encourage Richard to review the AIA contract. There is always room to add clauses or addenda which address specific problems he has had in the past. IF, of course, they are dealt with in a balanced manner. The bottom line is - "What's fair, is fair."Now I've gotta go back and read AIA 105 myself.gg-
*Richard,I'm kinda' new here, but I have not had any real problems w/ the AIA Contracts in the past. What I have done (and others mentioned) is develop a standard addendum to the AIA Contract. The Addendum is mostly derived from my standard contract, and covers or clarifies points that I don't believe the AIA form addresses either adequately or fairly.The way I look at it, a contract should be fair and equitable to both parties. What is fair and equitable is always open to interpretation. My addendum and any strikeouts/alterations I make to the AIA document bring the balance closer to the middle. To date I have not had any real issues when presenting this to clients or architects.One final thing I would say is that you should know your contracts (both your own and AIA) as well as you know your business. If something does not say what you want it to say, the way you want to say it, then change it so it does. Legaleze is not always absolutely necessary to convey the point at issue. What I found very helpful when I started in business was to pay an attorney who specialized in construction law to help me develop a standard contract. It was $400 well spent. My addendum, on the3 other hand, has evolved after e few "misunderstandings" which cost me money.Sorry for rambling!Mike
*Hi all,I still haven't gotten a chance to pick up a 105/205 even though the local AIA office is only about ten minutes away. Been busy trying to finish up the last job ,and now thankfully thats done. Decided not to go with the 101/201 and told the architect to submit my standard terms to the client (with the few revisions I've already discussed)and see what happened. Bottom line is he did, they didn't have a problem with it and the contract signing is tomorrow morning. I forgot to mention before that both the clients are high powered Manhattan attorneys,and made a couple of suggestions in the wording that I think enhanced the whole thing. Wonder what I would have had to pay for that advice? I think the whole thing is a fair and clear contract now and I will keep the revisions intact for the future. It's amazing to me that I've been using this thing for so long without a problem. I think it's because the body of my contracts are usually pretty comprehensive and give the details of the work to be done,and so I guess everyone involved sort of looked at the terms as pro forma. I asked the architect why he never mentioned them before on all the projects (municipal,commercial,and residential) we've done together in the past. He said he just felt that with these clients being attorneys that they would probably go over every clause. He was right, but fortunately it was basically a painless review. I'm still interested if anyone else has terms or contract forms they would like to share. This ( and estimating) is the part of the business I enjoy the least. Anything that makes it easier,quicker,and better would be greatly appreciated. I'm enjoying reading everyones perspectives and I think we are all in agreement over one thing...as gary said "Whats fair is fair".Thats a pretty good universal truth. Thankfully I've never had to refer back to my standard terms during a job, and I hope I never do. My word is good and in my experience most clients words are good too. Richard Max