Guide letters provide advice about matters architects should consider when composing letters to the parties involved in architectural projects.
1. When and how?
1.1 Write this letter prior to formal written agreement by the client to all the conditions of engagement proposed by the architect.
1.2 Clearly set out the extent of the services to be provided and the fees that apply to those services.
1.3 Make sure that this occurs at the beginning of a commission before any work is done. It's best to get confirmation in writing from the client. If the client does not separately confirm in writing you can ask them to countersign your letter and return a copy to you.
2. Content
Refer to:
- preliminary discussions;
- nature and extent of project/scope of work (even if preliminary);
- project budget (if known);
- your professional relationship (registration, client's agent, professional indemnity insurance); and
- confirmation of the legal identities of both you and the person or business you are being engaged by, and the individual or client's representative that will be giving you instructions.
Advise:
- terms and conditions of engagement/form of agreement that you propose will be entered into;
- scope of services (architectural and any other services, eg your engagement of subconsultants or whether you propose specialist consultants);
- fees, including fees for additional services;
- disbursements;
- exclusions;
- frequency of fee accounts and payment terms;
- schedule of anticipated payments;
- copyright;
- moral rights;
- date for commencement of architectural services; and
- program to carry out services.
Request:
- nomination of client's representative with authority to make decisions;
- confirmation of appointment and acceptance of terms and conditions; and
- project budget if not already known.
3. Action
Writing this letter is strongly recommended in circumstances where all terms of the client-architect agreement have not yet been agreed in writing.
4. What happens next?
Before you commence work on a project you should have received the client's written acceptance of your terms and conditions of engagement. Note: The client may not accept your proposal and further negotiation may be necessary.
5. Are there other possibilities?
There are a range of possibilities for client-architect agreements including, but not limited to those listed below.
5.1 Institute forms
The Institute's preferred form of written agreement is the Institute's 2019 Client Architect Agreement (CAA2019). It is recommended that you get an agreement signed before starting work. Note also the Institute's copyright: unauthorised reproduction or modification of the general conditions of this document is not permitted. If you do modify the CAA2019, you must not represent to the client that it's the Institute's form of agreement or that it is a 'standard' form.
5.2 Australian Standards
Alternative standard forms for various circumstances, but use with caution. Refer to legal/insurance advice for recommended modifications to avoid loss of professional-indemnity insurance cover. Note: Australian Standards contract forms are copyrighted.
5.3 Practice specific agreements
You may draft your own agreement outlining the terms and conditions particular to the project. It is strongly recommended that this is developed with appropriate legal and insurance advice.
5.4 Client-generated consultant agreements
These are becoming increasingly common among government departments and large corporations. It is recommended that you obtain insurance/legal advice before you sign a client-generated consultant agreement, as some agreements contain clauses that may impact your rights as the consultant, constrain what you can do, require you to deliver services you may not have priced for or make your professional indemnity (PI) insurance ineffective. It is advisable to submit a copy of any proposed agreement for insurance/legal review. This review service may be provided by your insurer/broker without additional cost.
6. What can happen if you don’t have written terms of engagement?
6.1 Without a written agreement it can be hard to prove either the existence of an agreement with your client or what the brief, terms and requirements of the agreement were. There is a risk you might not get paid for your services. If the first payment due to you is not made and you still have no written confirmation you should only proceed further after obtaining legal advice.
6.2 Pursuit costs cover (insurance for fee recovery) is not automatic under common PI insurance policies and will only be available if there is an endorsement or extension on your policy. Even so, you should check with your insurer/broker and don't assume that pursuit costs cover will apply to every circumstance.
6.3 In some states, it is a breach of the relevant Architects Act regulations or Code of Conduct to fail to provide clients with written terms of engagement. You should check with the relevant state Registration Board about the current requirements to enter into a written agreement.
7. Copies
7.1 Architect's file
Disclaimer
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