By Aileen Leipprandt
In April 2017, the American Institute of Architects (AIA) released the 2017 editions of its flagship agreements, including the Owner-Contractor Agreement (A101), Owner-Contractor Agreement, Cost Plus a GMP (A-102), the General Conditions of Contract (A201) and the Contractor-Subcontractor Agreement (A401). Significantly, AIA also created a new comprehensive insurance and bonds Exhibit (Exhibit A) to be used with these agreements.
Some interesting changes to note:
- Liquidated Damages. Liquidated Damages are now expressly identified with a new provision. In prior revisions, LDs were merely suggested in a “prompt” as an insertion. Furthermore, the Owner is not required to file a Claim to impose liquidated damages. Prior AIA versions were silent on whether Owner was required to file a formal claim; courts addressing the question reached differing results.
- Captive Insurance Costs. Contractor must obtain Owner’s prior approval of Contractor’s costs for insurance provided through a captive insurer owned or controlled by Contractor.
- Allocation of GMP. Adopting a revision commonly made by the parties, if a GMP is given, allocation of the GMP does not constitute a separate GMP for each individual line item on the Schedule of Values.
- Termination Fee. Where the Owner terminates the agreement for convenience, Contractor may be entitled to a termination fee. Prior AIA versions were silent as to such fee.
- BIM Reliance. Use or reliance upon a BIM model without establishing protocols for such use is not at the relying party’s sole risk, without liability to others.
- Communication Protocol. Communication protocol is loosened so that the Owner and Contractor can communicate directly, so long as the Architect is included in communications that relate to the Architect’s services. In prior revisions, Owner and Contractor were forced to communicate only through the Architect.
- Weather Delays. Delays caused by weather, so long as properly documented, are now expressly included in the “force majeure” provision as a basis for extension of Contract Time.
- Overhaul of Insurance. The bulk of insurance provisions have been stripped from A201 General Conditions and now appear in the new 2017 Exhibit A – Insurance and Bonds. And, the insurance requirements are much more detailed, specifying particular coverages that are required (e.g., professional and pollution liability and UAV liability) and expressly forbidding certain common restrictions on contractor’s coverages.
What didn’t change? Indemnification, warranty and waiver of consequential damages provisions remain largely intact.
Want to learn more about the new AIA-2017 documents? Attend the West Michigan Construction Industry Forum on October 19, 2017.