Client Architect Agreement (CAA2019)

Agreement documents

• 2019 Client Architect Agreement contract (PDF)
• Schedule pages (Word)

The CAA2019 can be edited digitally or printed, filled-out and amended by hand. Editable versions of the schedules and signing pages are available digitally in word format, so you can edit and print professional CAA2019 contracts for use in your practice.

Once the terms are agreed with the Client, the schedule forms can be filled in and provided with the Agreement to your Client for signing.

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Guidance notes

• CAA2019 User guide (PDF)
• Differences between the CAA2009 and CAA2019 (PDF)
• Comparison summary between the CAA2019 and CAALS2019 (PDF)
• Information guide to the client (PDF)

The Information guide to the client has been produced to assist the Client’s understanding of the key elements of the CAA2019, as a contract and your engagement. You can give this to your Client at the same time as, or before, you provide them a copy of the CAA2019.

The User guide is intended to give you, the Architect, guidance on the contents and effect of the 2019 Client Architect Agreement, suggestions on how you can complete the details in the contract’s Schedules and practical guidance on delivering your services to your Client when using the CAA2019’s conditions.

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Guide letters (optional)

• Guide letter 1 Introductory letter
• Guide letter 2 Agreement for execution letter
• Guide letter 3 Non-return of executed CAA letter
• Guide letter 4 Second non-return letter
• Guide letter 5 Non-agreement to engage cost consultant letter

The introductory guide letter is intended for use immediately after your initial meeting with a prospective client. It is intended to be a confirmation of everything discussed with the client – it assumes you will forward a draft of the agreement as an attachment to the letter.

The subsequent guide letters 2 to 4 deal with the situation where an engagement is proceeding but the formal agreement has not been signed and returned by the client, and (if applicable) guide letter 5 confirms that the client does not agree to the engagement of a cost consultant.

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Architects Acts and Codes of Conduct

Each state and territory has its own Architects Act and architects regulations (Refer Acumen note Architects Acts). In addition, mandatory codes of conduct have been adopted in some states that architects must comply with.  The CAA2019 has been prepared to be compliant with the various requirements, however, all members should be familiar with the applicable Code of Conduct and the various obligations to their Client, including giving their Client a copy of the Code of Conduct (where applicable).

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CAA2009 withdrawn from sale

The CAA2019 is a major revision and the CAA2009 has now been withdrawn from sale. We strongly recommend you use the CAA2019 to better protect your interests, avoid misunderstandings or disputes and have a contract that is compliant with the current Codes of Conduct in each state and territory and is simpler to understand.

We strongly recommend you and your team take time to learn the new CAA2019 and its provisions. Also, if your practice uses internal template documents or cover letters that include references to the old CAA2019, you should update those documents promptly for the new CAA2019 document.

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2019 Client Architect Agreement: the basics

The following information outlines some of the points to be aware of when using the CAA2019, and highlights the major differences between this agreement and the previous CAA2009 agreement.

To help you learn about the new CAA2019 contract and understand what’s changed, we’ve also developed a 'differences' reference table that compares the old CAA2009 clauses and sections with the new CAA2019, as well as briefly explaining the all-new provisions.

This information does not deal with every aspect of the agreement and we strongly recommend that you read and understand the CAA2019 contract and the User guide.

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Scope of the Architect's services

The CAA2019 adopts a similar structure and approach to setting out the scope of your service as the CAA2009 – it is laid out in a way that draws the Client’s attention to those services you will perform in a detailed way. Now, each item of the services you are to deliver is set out in the Schedule A: Scope of Services on pages 7 to 10 of the CAA2019. The services listed in this schedule are editable in the word templates – you can add, edit and replace them and add new lines as needed, or you can adopt the suggested services listed.

Schedule A has 3 new columns: ‘Included’ ‘Excluded’ and ‘Additional’ so that you can clearly capture and identify for your Client what services are included in the Fee you’ve agreed from the outset and which services are available at an additional cost or fee (subject to the procedure for a change to the services). This should help avoid misunderstandings and disagreements about what you have agreed to deliver, from the outset, for the Fee. Marking a service as 'Additional' is a useful way of indicating to the Client that you are prepared to offer that particular service as an extension of your engagement, but that an additional fee applies (and will require a 'Change to the Services' under the CAA2019).

We strongly recommend that you clearly identify each line by ticking the respective box. However, for any line item that is unmarked or ambiguous – the provision at the top of Schedule A states that such an item is by default excluded from the Services. This way, it’s at your discretion how to correct it or whether to include a service in the Schedule that doesn’t have a clearly marked box. A Client can’t argue that an ambiguous line item should be considered 'included' in the Services for the Fee. 

The services you are to provide are listed under two main headings, expressed as Section A and Section B:

Section A (page 7) lists the services you are likely to provide on almost any project if engaged from commencement to completion – referred to as the 'Core Architectural Services'.

Section B (page 9) contains a list of the services considered to be 'Additional Architectural Services' but which are commonly offered or required. Note that new services have been added in section B.6 for circumstances where you are to provide contract administration and there is a dispute between the Client and the builder. These services are typically additional to and not included in the scope of service for your fee.

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Cost of the project

The difference between the defined terms Total Project Cost and Cost of Works is spelled out both in the User Guide and in the CAA2019 at clause A.3 and the defined terms listed in Section M.

In the CAA2019, the cost of building work and completed cost are a single concept so that forecasts of cost are captured in the Cost of Works. This amount is a forecast, budgeted amount that must be adjusted according to the information available up until the time of completion of the project. As before, the Architect is responsible for preparing the forecast and adjusted Cost of Works and its components are related to the services the Architect is to perform.

In contrast, the Total Project Cost is a budget amount which the Client is responsible for managing, and includes the Cost of Works, but also project costs which are not related to the Architect's services eg finance, landscaping, loose furnishings.

See the User guide for a more thorough explanation of these terms.

Under the CAA2019 you are not responsible for monitoring or controlling the Total Project Cost for the Client.

It is important not to take control of matters which are outside your responsibility under the agreement as set out in Schedule A: Scope of Services.

Such matters are likely to be outside your architectural expertise or not considered part of the Architect's services for which your liability is covered by professional indemnity insurance. It is preferable to make clear what is not in the Architect's range of skills and suggest the Client consults someone with the required expertise for these items.

You should explain to your Client the basis of the fee calculation you have proposed. Where the Client is to engage the specialist consultants, you may want to advise the Client of the range of fees that might be anticipated for those consultants. To assist you may give your Client a copy of the 'Information guide to the client'.

Your Client agrees to and are bound by the budget for the Cost of Works, subject to agreed adjustments in accordance with the agreement as the project moves forward. This could be due to Client or consultant advice, tenders or offers received, or adjustments arising during construction. The CAA2019 has been carefully drafted so that your forecasts (and revised forecasts) of the Cost of Works are not contractually binding as a guaranteed estimate and your Client needs to understand this distinction.

The Cost of Works does not include GST. This figure is the basis for calculating percentage fees under the agreement. Calculating a fee as a percentage of a GST inclusive figure may prompt allegations from the Client of double-dipping.

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Time

It is advisable to promptly agree with the Client a program for delivery of the services according to the Client's own program. The CAA2019 provides for this in clause A.4.

Once a program is in place, if the Client fails to deliver information, give confirmations or put certain actions in place according to that program, which delay the Architect's services, these fall under the causes beyond the Architect's control that can trigger the protracted services provisions under clause A.5. Although there is a right to additional fees and a reasonable extension of the agreed program, there is no provision for their calculation according to a set formula. The amount of the fees and extension of time need to be negotiated between you and the Client, following the procedure set out at clause A.5.1.

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Fees

When completing Schedule B, Item 1 of the agreement, if you have negotiated percentage fees for the services under a given services heading (eg B.6 Other Services), but a lump-sum fee or hourly rates applies to one or more sub-services under the same heading – say for an additional service not specifically listed in Item 1 (eg B.6 preparing for court or tribunal proceedings for a dispute under the building contract) – you will need to make the fee basis abundantly clear to avoid misunderstandings or disputes. This schedule is editable, so you may consider a suitable edit to the Item 1 table of headings to clearly identify the relevant Fee type for that sub-service.

Confusion could also arise where you have negotiated a combination of percentage fee and hourly rates or lump sum and hourly rates for services under any given heading (eg A.3 Planning/Development Application at hourly rates, but then A.3 Co-ordinate preparation of an updated forecast of the Cost of Works as a lump-sum).

You can edit the Schedule B, Item 1 to capture this, or include a list or table in the Schedule C: Special Conditions that sets out each services item that has a unique fee method.

The CAA2019 now also provides for a Mobilisation Fee in Item 1: A.0. This is provided as a fixed, lump-sum amount only. This is clearly defined as a pre-payment of your Services to be delivered. Note that some of the Codes of Conduct limit the amount of any deposit-type payment (which may include the Mobilisation Fee), relative to the overall Fee. For example, the NSW Code of Conduct limits deposits to 10 per cent of the ‘reasonably expected or agreed total fee’ – depending on whether the fee is a lump sum or a percentage of the forecast Cost of Works.

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Specialist consultants

A flexible approach is adopted, allowing for either the Client or Architect to engage consultants. If the Client engages the consultant, the Client must do so on the terms in clause E.1.3.

If the Client engages the specialist consultants, you have a contractual right to co-ordinate them and the benefit of their deliverables.

If you are to engage a subconsultant directly, on the Client’s behalf, we recommend that you use the Institute’s Architect Specialist Consultant Agreement 2017.

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Copyright and licensing

Basically, you own the copyright and you give a license right to the Client to use the design on payment of the fees. You also have the right to revoke the licence if the Client tries to assign it to another owner and has not paid your invoices, or tries to use your design in any other way other than to build the project on the elected Site (without your prior permission).

The scenario to be wary of, is where there is a development approval and the Client intends to sell the Site with the benefit of the approval. The current law has confirmed that where nothing else limits or affects the licence arising by implication from the creation of the design, the development approval and the intellectual property in the design embodied in it go with the sale of land, despite what the agreement was between the original Client and the Architect.

The express wording of the CAA2019 is designed to preclude the Client or a court from implying a licence arising from the Architect's engagement in favour of the Client or its purchaser of the land. The CAA2019 gives the Client an express licence but limited by the specific conditions set out in clause F.1.2. It also gives you further protections if you, the Client or a third party ever ended up in legal action over the use or misuse of your design.

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Moral rights

The CAA2019 provides for the Architect to nominate the way the project will be attributed (the ‘form of attribution’). This form binds both Architect and Client to use this form of words for public information they put out about the project including entering the project in the Institute’s Architecture Awards program. Remember, you must obtain the necessary consents from all the authors of the design before you can specify a form of attribution for you or your practice.

See also Acumen notes on Copyright and Moral rights 

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Limit of liability

Clause G.2 contains a limit on the liability you may come to owe to your Client. This is a contractual way of allocating risk between the parties and is prudent risk management. This limitation has changed under the CAA2019; liability is no longer limited by a specified dollar amount or by a period of time. The limit is now the amount you recover under your professional indemnity (PI) insurance in the event of a claim, after a contribution or excess you pay to your insurer. We consider this a fairer limitation between the Architect and Client because it shouldn’t leave you out of pocket under the PI insurance policy you must have in place, unless your PI coverage is too low.

The more comprehensive information provided in the User Guide should be carefully considered as well as the information on Limitation of liability. Your Client may request that the limitation on liability be changed or deleted. We strongly recommend that you never agree to change this clause G.2, whether in a Special Condition or any other way. If your Client insists, you should get legal advice.

If you are directly engaging consultants on behalf of the Client, you should very carefully consider the proportionality between the limit of liability you agree to provide those consultants and the limit on liability you have agreed with your Client under the CAA2019. If in doubt, get legal advice and contact your insurance broker.

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Termination

The CAA2019 now sets out clear termination rights, the conditions for the termination right to apply and the procedure to then follow. It provides termination rights for four different scenarios:

By the Architect:

a. for breach by the Client of a material provision—clause K.1
b. without reason (subject to conditions)—clause K.2

By the Client:

c. for breach by the Architect of a material provision—clause K.3.2
d. for insolvency/bankruptcy of the Architect—clause K.3.1

In all cases, the party terminating must give notice to the other party and then a notice period applies before the termination date takes effect. Termination under scenario A or D (insolvency) can be immediate; scenario B requires 30 business days’ notice and scenario C requires 10 business days if the Client gives notice of an alleged breach of the contract.

In the Architect's favour, the termination procedures (as applicable) now make it clear that the Client must pay or reimburse the Architect for all Services delivered, all costs or expenses incurred and all additional Services needed up to and including the date of the termination.

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Digital data and BIM

The CAA2019 now clearly deals with electronically transmitted data, default digital formats as well as Building Information Modelling (BIM), if used on the project. See clauses F.3 and F.4. The default digital file format between you and your Client is PDF and you are entitled to charge an agreed fee for converting files or providing files in a different digital format.

Be aware of which termination right is being exercised, because although the termination procedures may look similar, they are not the same.

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