Guide letter 18: Advice to client - building contract

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Guide letters provide advice about matters architects should consider when composing letters to the parties involved in architectural projects.

1. Caution

1.1 The main reason for sending this letter is if your client wishes to use a building contract other than an ABIC contract.

1.2 It is your client's responsibility to decide which building contract they wish to use, but you should advise your client of the advantages of using one of the ABIC contracts.

1.3 Your client may think that another form of contract would be in their best interests (such as one drafted by their lawyer) but cannot evaluate the benefits of one form over another unless they are fully informed.

2. When and how?

2.1 The ABIC contracts contain specific conditions which define the architect’s role in administering a contract, and such advantages may well outweigh perceived advantages of 'special contracts'.

2.2 Send the letter prior to preparing the specification.

3. Content

Advise that the advantages of ABIC contracts are:

  • the documents are recognised and understood within the industry and define the role of the architect during construction
  • contractors are familiar with the conditions and have participated in their formulation and this assists them in bidding competitively
  • they will provide a better basis for comparison of tenders.

Recommend:

  • that your client adopt a standard form contract but advise that the final choice is theirs – in this regard your recommendation should be that the client seeks their own advice concerning any legal or contractual matters.
4. Action

4.1 You should write this letter or at least confirm in writing the prior discussions with your client.

5. What happens next?

5.1 If your client agrees to use an ABIC contract, confirm and write the letter outlined in Guide letter 21.

5.2 If your client decides not to use an ABIC contract you should read the proposed contract thoroughly. If there are matters that concern you, seek legal and insurance advice on the liabilities which may arise out of administering the nonstandard conditions. Advise your client of any difficulties you, your professional indemnity insurer or your legal adviser foresee. If your role under the contract differs substantially from your normal role, it might be necessary to change your terms and conditions of engagement.

5.3 Base the specification on conditions in the contract. If a nonstandard contract is used check the relevant specification clauses against the contract conditions to ensure there is no conflict. If in doubt, advise the client and recommend that the client seeks legal advice from the author of the contract. Reconfirm any advice received with the client and the client's lawyer and the client’s building insurance adviser.

5.4 Confirm with your insurance broker that the contract conditions/responsibilities are covered by your policies. Reconfirm any advice received with the client.

6. Are there other possibilities?

6.1 No.

7. What can happen if you don't?

7.1 If you fail to adequately advise your client on the choice of building contract your client might incur unnecessary expense.

8. Copies

8.1 Architect's file

Disclaimer

This content is provided by the Australian Institute of Architects for reference purposes and as general guidance. It does not take into account specific circumstances and should not be relied on in that way. It is not legal, financial, insurance, or other advice and you should seek independent verification or advice before relying on this content in circumstances where loss or damage may result. The Institute endeavours to publish content that is accurate at the time it is published, but does not accept responsibility for content that may or has become inaccurate over time. Using this website and content is subject to the Acumen User Licence.

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ABIC contracts
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