Architects working together

When considering whether collaboration with another architectural practice is appropriate for a particular commission, the following aspects should be checked:

• What is the legal liability of each party?
• What contractual arrangements will be necessary?
• Are the resources of each party adequate?
• What is the fee-sharing, profit/loss arrangement?
• Are there any legal, tax or industrial-relations issues in the collaboration?
• Will there be a sunset clause?

In all cases, legal, accounting and professional-indemnity insurance advice should be obtained before entering into any agreements for working together.

Generally, there are three ways in which architects can join forces for such projects:

Joint venture agreements

A joint venture agreement is where a separate legal entity (typically a company or partnership) is created for a specific project or field of work, generally with representatives from each practice on the board. Aspects of the joint venture that need to be addressed in the agreement between the parties include: the parties, accounting arrangements, taxation, insurances and liability, copyright, and roles and responsibilities of the parties. Profit (or loss) sharing and the period of the agreement should also be considered. In some instances, clients may take an active role in the establishment and some conditions of these agreements. Legal practitioners experienced in this field should prepare joint-venture agreements.

For further information on joint venture agreements, refer to Acumen note Joint ventures.

Architects in association

Often, a less formal relationship is required, whereby practices join forces but keep their own identity. For commissions where architects combine to provide their services concurrently for specific aspects of a project, 'architects in association' is a more appropriate arrangement. In this situation, each architect signs a client-architect agreement, but has their roles clearly defined in this agreement. While each party may have equal legal standing in this agreement, their liabilities may differ, depending upon their roles.

Before entering into any such agreement, each architect should consult its professional-indemnity insurer to confirm its cover is extended for and not compromised by this arrangement.

A separate agreement between the architects that addresses the roles and responsibilities of each architect, fee sharing, insurances and personnel must also be prepared. This agreement may be reasonably simple and could be prepared with the mutual consent of the two parties. In other cases, where the association is more complex, a legal practitioner should draft the agreement. Generally, each party is responsible for its own profit/loss and liability for its activity.

Subconsultant agreements

An alternative to 'architects in association' is where one architect is the principal architect and is the only one referred to in the client-architect agreement. This principal architect provides the professional-indemnity insurance, carries the risk with the client, takes the profit/loss and manages the work of all team members. In this arrangement the other architects are regarded as subconsultants who provide a fee-for-service to the principal architect. Care needs to be taken on legal aspects of this arrangement and a separate agreement for each subconsultant is necessary to cover issues such as the responsibility of the subconsultants and professional-indemnity insurance.

In addition, issues such as attribution for design, copyright of ideas, details and concepts and responsibility for meeting program and budget should be considered.