should I use an AIA contract?

Should I Use an AIA Contract?

I’ve signed, negotiated, administered and litigated my fair share of agreements as a licensed architect with 30 years construction experience. By the end of this journal article, you’ll have a clear understanding to answer should I use an AIA contract? AIA is an acronym for the American Institute of Architects and Australian Institute of Architects.  Both are the premier professional organizations for architects and offer architectural design contracts pursuant to state and federal laws.  AIA contracts are tried and tested contracts, utilizing generations of collective experience in the architectural profession.  The AIA library consists of over 200 standardized contract documents covering everything from owner-architect agreements to construction change orders.  Consider them the Swiss Army knife of architecture contracts with a separate instrument for every occasion.

Many omit the question, should I use an AIA contract?

Property owners who are “…penny wise and proud foolish…” to coin an old english idiom, often make fatal contract decisions.  The crucial question, should I use an AIA contract is often overlooked by property owners seeking budget savings.  Property owners who omit the architect from construction phase superintendence pay minimum 30% over the initial contract building sum.  A recent client design development meeting revealed he had signed a Cost Plus Contract directly with a builder for $10M.  An architect was not involved in the client’s building’s procurement strategy and the project reached practical completion for approximately $30M.  This experience highlights the cost plus contract dangers and benefit of engaging an architect as umpire between builder and client.  A 20% budget blowup can end with an architect unsuccessfully defending a claim in court – let alone 200%.

Traditional design and bid/tender.

The traditional building procurement process is typically broken down into stages:

• concept design;
• sketch design;
• design development;
• working drawings;
• contract administration (during construction).

Many property owners are myopic during the building procurement process and errantly omit the architect’s services during construction.  Eliminating an architect’s superintendence and watchful eye during the builder’s construction is a fatal flaw and false economy.  The traditional design and bid building procurement process is still utilized by local, state and federal governments for a reason.  Government agencies understand the need for the architect’s contract administration of the builder during construction.  Architects incorporate a fee for contract administration/ superintendence during construction to avoid builder substitutions, short-cuts and contract manoeuvres.

AIA contract procurement strategy 

In states like where builder licensing requirements are lax; it is prudent to draft a comprehensive contract.  The architect’s superintendence in these states during construction is more critical to ensure clients aren’t extorted by the successful bidder.  Contract selection is still critical in states with robust builder licensing laws as their lawyer is a telephone call away.  The most important client question remains; should I Use an AIA Contract? as architect superintendence during construction reduces construction cost.

AIA Contracts offer clause advantages.

Should I Use an AIA Contract is typically answered ‘no’ by builders, as they include clauses to compel builder accountability.  Licensed builders generally use builder association contracts omit these very necessary contract triggers and protect the builder.  Some of the pertinent clauses to protect client interests in quality workmanship at a fair price include:

• building program/practical completion date.
• contract sum adjustments;
• extensions of time;
• liquidated damages;
• variations/change orders.

The question, Should I Use an AIA Contract? is simply answered as ‘always’.  AIA contracts are battle-tested with thousands of architects, regularly updated, include digital updates and in accord with state and federal laws .  Here are some of the reasons for superior performance of AIA contracts:

This is not legal advice so consult your attorney, lawyer or barrister for project-specific guidance.