OAA Standard Contracts 2005

OAA Standard Contracts 2005
ARCHITECT - CLIENT CONTRACT
Agreement A record of what has been agreed upon.
Agreement You need to have agreed upon something before you can record that you have.
vs.
Agreement
Contract
Traditionally we refer to Contract as the instrument recording agreed terms and conditions between Owner and Contractor, and Agreement as the instrument recording agreed terms and conditions between Client and Architect, or between Architect and Consultant.
Forms of Contract
ORAL
Oral Contract
Not worth paper its written on If no witness hard to claim or defend Memories short and convenient Hardly ever a clear mutual understanding of each others expectations At best they increase the bank accounts of lawyers since they have to spend more time in litigation
Forms
Written
Written Contracts
All that oral contracts are not Signing a formal document emphasizes seriousness of the matter Contrary to argument against written contract, Clients are not intimidated Good business practice Often those who did not have one lament that fact later
Forms of Written Contracts

Single page (e.g. OAA 301) Architectural practices own letter agreement (unilateral contract ) Sign-back letter contract Owner standard contract Industry standard contract
Single Page Contract 301

1. To be used as interim agreement binding the parties until more detailed agreement can be arrived at. Allows Architect to proceed with the project. 2. As a last resort only when the alternative is an oral agreement - Not encouraged!
Architects Own Contract

Seldom contains the balanced, protective clauses (for both parties) Argued by users that other 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 contracts between Owner and Contractor)
Clients Standard Contract

Often prepared by Owners legal counsel seeking to shift balance of risk to Architect If forced into a non Canadian Standard Form of Contract for Architectural Services - consult with both your own legal counsel and your insurer before signing.
Clients Standard Contracts

Beware of Double Jeopardy clauses:

- Architect will hold Owner 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. - Architect will obtain building permit.
These types of statements are often considered as a warranty or guarantee and as such are exclusions in your insurance or indemnity policy. Accordingly, you are not covered but your client is provided with a cause of action (hence the double jeopardy).
Standard Documents
Strive to use the standard documents prepared for your use by your profession. They have stood the test of time, have had legal input, and are continually being updated to reflect changes in practice in law and in custom.
Standard Contracts
Document Nine
Canadian Standard Form of Agreement Between Architect and Consultant
Documents Six and Seven have been replaced by Document Six, 2002.
RAIC Document Six has been replaced in Ontario by OAA Standard Contract 600
Changes in Practice and technology as well as the need for a document that can be flexible, comprehensive and easily customizable to more closely reflect the realities of architectural practice today and tomorrow, prompted the need for a new standard document.
Document 600 is that document.
Document 600- An Overview

The OAA developed and published Mastering the Business of Architecture to support Ontario practices in 1999, and distributed it to all members. The MBA Kit, as it is often known, is intended to provide a business resource and tool to Ontario architects to support them operating in a more competitive, business environment. Part of the MBA Kit provides guidance on preparing a detailed scope of services for a project, then developing, negotiating and contracting the appropriate fee.
As we released the MBA Kit, we became aware of the new AIA B141 standard agreement, which provides much greater utility in scoping and describing services in detail, and more flexibility in reflecting fee arrangements than the then current Canadian version. On the recommendation of the OAA, the participants in the National Practice Program agreed to redevelop the Canadian standard form in a brand new format, similar to the AIA document.
Subsequent to publication of RAIC Six, 2002, a number of members expressed concerns in regard to the document. OAA Council directed staff to develop an Ontario based contract which led to document 600
Document 600 is subdivided into 5 distinct modules:
Cover
Authorizes use and protects copyright
A
Agreement Form Definitions
GC
General Conditions
SCH
Schedules A-Architects Services B-Client
Responsibilities
The Agreement is the only module requiring the parties to execute. The Cover, Agreement and Schedules are in Word format for maximum flexibility The definitions and General Conditions are in pdf. Changes, if necessary are made through agreement article A.18 or marking and initialing the hardcopy
Cover
Space is provided on the cover to identify the project and the project number
Agreement Form
Additional services are reserved for changes in scope of architectural services, and should be minimal.
GENERAL CONDITION 7.5

The client acknowledges that either the architect or the client may engage consultants on behalf of and for the benefit and convenience of the client; and agrees that the architect shall not be liable to the client, in contract or in tort, for the acts, omissions or errors of such consultants whether retained by the architect or the client. Nothing in this clause shall derogate from the architects duty of coordination.
SCH
Schedules
Architects Services Client Responsibilities
SCHEDULE A TO 600
ITEM
ARCHITECT'S SERVICES: FEE CLASS
CLIENT'S RESP.
N/A
Analyses of client's needs- review clients stated objectives and advise on viability of the project Statement of Requirements or Building Program- Set out the fundamental objectives of the project, including the interrelation of space allocations, the areas required for the spaces, specific materials and /or assemblies to be used, massing, time factors, cost implications, constraints, and any special design considerations required for the project.
Schedules The system is designed for maximum flexibility. Modules may be further separated into sub-modules grouping services by fee arrangement (e.g. fixed fee or percent of construction cost for a group of services; and time based for another group).
Some may prefer to have a column added to the side of the schedule of services with a fee noted alongside each item. In the alternative, groups of services may have a fee attached; and another alternative would be to not have any fee attached to the schedule other than what was noted in the agreement for the project.
Flexibility
Discuss menu with client and jointly customize the agreement
Prepare customized version and discuss proposed services and clients obligations with the client
Flexibility
Some may prefer to place $ value of services along each item Some may prefer to place hours for each service Some prefer no list of fees for service tasks
No Cherry Picking
IMPORTANT!
One important aspect of the main menu and schedule approach is that it provides an excellent vehicle with which you can use as a checklist to review with your client in detail the services you will be providing. The time taken to review the entire agreement including agreement form, Definitions, General Conditions, and the Schedules is perhaps the best investment you can make to avoid disagreements and to ensure that the expectations of both parties converge.
Services that were not easily reflected by previous versions of the standard agreement between Client and Architect can now be readily accommodated by appropriate customized schedules of Architects Services and Clients Obligations. Some members will prefer to review the entire main menu with their clients and together prepare the schedules. Others may prefer to prepare a customized schedule of services and review the schedule with the client - adding or subtracting services through dialogue.
Customize Expand on or delete list of services as required for each project/client
New for 2005 OAA 600 OAA 609*

GUIDES for 600 and 609*
(*609, Contract For Sub-consultant services, is anticipated to be issued at the end of 2005).
Summary
1. The contract is a RECORD of what has been agreed between the client and the architect. In order that this record may be made, the parties will have to have discussed their expectations of each others obligations and reached an accord.
Summary
2. Standard contracts prepared by your association serve as an excellent starting point for you to prepare a contract customized for your client and for your clients project. The final contract should be balanced and fair to both parties.
Summary
3. Do not enter into ORAL contracts. They offer very little or no protection to either party and are the source of disputes which can (and often do) escalate into serious and costly legal arguments.
Summary
4.
Avoid hybrid forms of contracts, particularly those drafted to transfer risk to parties in nontraditional ways. Avoid the practice of the letter agreement. Use as much as possible the professions standard contracts.
Summary
5.
Standard contracts are compatible with other standard documents recognized as such in the industry (CCDC documents, design-build documents 14 & 15, CCDC documents, etc.).
Summary
6. Document 600 is designed to be compatible with and complementary to the MBA Kit. Fees and services are more closely linked than previous versions.
Summary
7. Document 600 readily accommodates an expanded range of services including non-traditional services.
Summary
8. Document 600 provides architects with another tool for business and marketing opportunities.
Summary 9. The format is redesigned for ease of use and reference:

Document is separated into distinct modules
cover agreement definition general conditions schedules
Articles in the agreement and general conditions modules are identified by an alpha-numeric code for ease of reference
Summary
10. Additional services are minimized and relegated to unforeseen and unanticipated scope changes. Services not agreed to in the agreement are treated as change in scope and subject to adjustment to fees and time.
Summary
11.Electronic format makes the document readily accessible and easier to complete while maintaining control over the maintenance of it as a standard document.
Summary
12 As in all contractual relations, one of the

best investments of time is a careful, item by item discussion between architect and client as to the scope of services. It not only greatly reduces later opportunity for the client to introduce scope creep, but also serves to identify to the client the value of the architects services and increases the convergence of the expectations of the parties to the agreement. Document 600 facilitates such discussions by introduction of the list of services

OAA Standard Contracts 2005

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ARCHITECT - CLIENT CONTRACT