Construction begins with a plan. It is critical to have an architect’s agreement or engineering agreement that clarifies exactly what each side is expecting from the other. We represent both owners and architects and are familiar with the issues with respect to design and construction. It is critical in any agreement that both sides clearly understand key aspects of the project. An architectural agreement or design contract must be specific to avoid confusion on certain critical points such as:
- Scope of the Project. Both sides need to know what is and what is not expected of them. Will the architect oversee the project or simply draw up plans? How detailed will the plans need to be? Will they include electrical, structural mechanical, interior, and lighting designs?
- Fee. The cost of each phase of design should be clearly specified along with the timing and milestones that will trigger each payment. A procedure for charges when there are changes to the plan needs to be agreed upon and the contract should be prepared so it is clear to all concerned what fees will be incurred and when.
- Budget. All too often parties do not communicate with one another and contract around a budget. A design is worthless to an owner if it will cost too much build and owners need to understand, up front, what it is they can and cannot do within their budget. The single biggest problem in any construction project is going over budget and avoiding budget overruns begins with a proper design.
- Insurance. The parties need to agree on what insurance coverage will be obtained for the project and who will pay for the premiums.
- Ownership and Use of the Plans. Those who are new to construction are not aware that in the absence of an agreement to the contrary, the architect or designer owns the rights to the plans. Just because you paid for them does not mean you own them. How the plans can and cannot must be clearly specified in every architectural contract or design agreement.
These are only a few of the issues that need to be discussed and reviewed by an experienced real estate attorney. We are familiar with AIA Agreements prepared by the American Institute of Architects and we know what types of modifications need to be made to these agreements so that they are even handed and represent the full intention of the parties.