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Sometimes architects enter into forms of engagement that differ from standard Institute Client and Architect Agreements where conditions require the architect to warrant that architectural services will be performed within a stated time. Such a warranty usually carries with it some form of penalty for non-performance. This is especially likely where the client is also under penalty for non-performance as to time. Such can be the case where the contract procurement method is a design-and-construct or other non-traditional form of contract, in which the deliverer of the project is in contract with the owner, developer or project manager to deliver the completed project 'on time', and the architect is in contract with the deliverer.
Provisions for penalties for non-performance in respect of time should not be accepted, but if this is not possible, must be considered with great caution. Any such warranty must provide for a realistic time-frame for services and the project program should include a time allowance for delays beyond the architect's control. Time based non-performance clauses should be balanced by referencing the agreed design/project programme and provide a mechanism for fair extension of time claim procedures.
Architects are advised, before providing a warranty, to check with their professional indemnity insurer to ensure that making such a provision and/or accepting a penalty for non-performance will not void their professional indemnity insurance. Traditionally, such insurance does not allow the imposition of penalties upon the insured.
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