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The Architect-Contractor Smackdown: Using specifications and drawing notes to create an end-run around the contract

  • 1.  The Architect-Contractor Smackdown: Using specifications and drawing notes to create an end-run around the contract

    Posted 04-28-2011 14:25
    This message has been cross posted to the following Discussion Forums: Project Delivery and Construction Contract Administration .
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    The Architect-Contractor Smackdown

    Using specifications and drawing notes to create an end-run around the contract

    by Steven G. Shapiro *This entry was originally posted to AIA Archiblog in June 2008.

    During a typical design and construction project, the general contractor and architect work closely for the duration of a project, often without a direct contract, to legally define the scope of their relationship. In the absence of a contract, the parties often jockey to create greater rights to protect their own interest.  Lately, it seems that the architecture community has expanded its rights to the detriment of the contractors.

    Consider, for example, an architecture firm designing an office building and a general contractor engaged in its construction. By the terms of its agreement with the owner, the general contractor delivers a submittal to the architect for review and may contractually expect a response in 7 business days. By the terms of the drawing notes and specifications, however, the architect may have reserved 10 business days to respond to the submittal.

    This simple example illustrates the seemingly endless tension in the allocation of the rights and duties between the general contractor and the architect. In the traditional delivery method of design-bid-build (or various hybrid forms of project delivery), the architect holds a contract with the owner regarding the duties of design and contract administration. As part of its engagement, the architect then issues drawings and specifications setting forth the design of the project.

    At the same time, the general contractor negotiates a separate contract with the owner regarding construction services. In the construction services agreement, the drawings and specifications are incorporated into the document to form the contract documents. These contract documents bind the GC to their dictates and directions and, at times, conflict with the terms and conditions of the construction agreement.

    By appearances, the architectural community has recently expanded the reach of the specifications and drawing notes to place undue risk to the contractor. As a construction manager and allied member of the AIA, I appreciate the agenda of the architects. The zeal to re-allocate risk to the contractor is now beyond the norm.

    Legal disputes, or perhaps battles of negotiation, are likely brewing between the GC community and developers, and, by extension, architects.  In the near-future, I would expect to see contractors seeking to limit the power of the architects to set forth their working relationship. In the absence of resolution, I can envision litigation to resolve these issues.

    *Steven G. Shapiro, an allied member of the AIA and former commercial real estate development attorney, is an adjunct professor at the University of Maryland and a project manager at a large general contractor. He can be reached at stevengshapiro@aol.com.

    This entry represents the informed opinion of the author only. It is intended for general information purposes only and does not constitute legal advice. The reader should consult with legal counsel to determine the complex interaction of laws, suggestions, and illustrations with specific situations.

    Comments (11)

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    Todd Sowers:

    Kenneth Watthuber, AIA:

    Generally Architects create their own roadblocks by being stubborn about resolving issues that may in the best interest of the project. It is common for AE to have the attitude that "everything rolls down hill", creating a very arrogant uncooperative atmosphere, rarely allowing a cumulative decision. This forces contractors to create more paperwork, RFI's for protection. The average contractor will always have a get it done attitude. The contract documents are constructed with open language that allow AE to revert any decision. Most issues have simple solutions, if the AE might realize their human and accounting for every detail in contract documents is impossible. As mentioned the eagerness of our society, is a failure for all. "What's wrong with admitting your mistakes"? If the AE were perfect in design of the contract documents, it would be easy to comply with producing what is the intent of the AE and Owner.

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    M. Chamoff, Design Builder:

    With regards to discrepancies such as submittal turn around times, a competent GC should either recognize the specified requirements on the bid drawings or qualify to what they have included in their bid/price. The GC should be spelling out all inclusions and exclusions in his bid and these items should be discussed by O,A&GC before any contract is signed.

    One way to optimize the process is by getting a GC involved early on. Working with a GC through the design phase can help owners and architects understand the costs, schedule and logistical impacts before a design is finalized. This will leave little opportunity for the Contractor to push blame back to an Architect.

    Many times the drawings are not bid out until the design is finalized and the Contractor has little time to understand a design which took months to create. This can leave many questions unanswered.

    The longer a Builder has to review a project the more complete and accurate his estimate will be. Again, leaving less chance for the Contractor to push blame back to an Architect.

    Strong project management and communication on both "sides of the fence" is key and can eliminate many of these problem areas.

    If one party is not meeting the expected requirements allowed by "disconnected contracts," bring it to the table and have the contract amended as soon as possible.

    As I stated above and as proven in many successful projects.. a simple way to prevent much of this from happening is getting the Contractor involved on day 1.

    I agree with Mr. Beyer, the documents need to be coordinated. And that doesn't just stop with the owner--it trickles down to the architect as the preparer of the specifications. The specifications writer should have access to the proposed Owner-Contractor (O/C) Agreement and the executed Owner-Architect (O/A) Agreement when preparing the Division 01 sections to make sure that obligations under those agreements are only further defined and not altered.

    Referring to the example of submittals used in the article, if the proposed O/C agreement stipulates the the expected turna-around time for submittals, the the O/A agreement should state the same. If the O/A agreement stipulates a timeframe and the O/C agreement does not, then the specifications should define the timeframe for the contractor as it is defined in the O/A agreement. If the O/C agreement has a timeframe, but the O/A agreement does not, then, as the architect, you may have to have a discussion with the owner if you disagree with the timeframe to establish a one that is reasonable.

    Other than the specifications and drawings, architects can't modify the terms of a construction agreement, and they can only modify the terms of their agreements with owners during the negotiation period prior to execution, or through whatever change mechanism is provided in the agreement.

    The reason there may be conflicts is probably due to the fact that one or more parties failed to review all the documents prior to issuing or executing.

    James Raptis, Architect:

    Well both the Architect and Contractor are in business to make money.
    They both have their own self intrest at heart. One is selling a service and the other a product. The architect is supposed to represent the Owner. But what does he care if the contractor charges more if the architect make more based on a percentage of construction. The conflict does come in about time and products. The contractor wants to use the cheapest product and get things done as fast as possible, to make the most profit. Of couse the architect wants the products he specificed or equal and he want to have enough time to review submittals to catch any mistakes. Of couse, any mistakes in the drawing or submittals will result in a change order and more money for the contractor. So the contractor blames the architect for his added cost (and profits.)
    The owner is the one who is in a lose, lose situation. While the architect points at the Contractor for not understanding the scope or intent of the drawings or asking questions in the bid process.

    Kenneth Watthuber, AIA:

    Now flip the coin on the contractor for a moment. I deal with contractors on a daily basis as well as construction managers hired by the owner to act as, in their eyes I've heard, another level of quality control. In reality, the cm's I've dealt with only serve as another roadblock. The contractor - architect relationship is at best advesarial without having another party with no true investment or liability for the documents or construction. In my experience the cm usually comes down on the contractor's side if differences arise, then spin the owner's perception such that the architect appears to be uncooperative. In fact, the architect is responsible to the owner for ensuring what is built reflects the intent of the documents. If the contractor can't deliver, then perhaps the owner needs to more closely scrutinize his contractors qualifications and ability to perform the work. Typically, again in my experience, contractors who can't perform the work ususally try to deflect the blame to the architect by sending unnecessary rfi's and change requests causing delays that usually end with the contractor getting more money from the owner. All we ask as architect's without having the benefit of a contract with the contractor is that one thing - provide the intent of the documents - if the contractor can't deliver why should architect's take the blame Mr Shapiro? I attribute these attitudes, even mine, to our society's over-eagerness to be politically correct. What's wrong with saying, "Do the work you promised to do for the amount you promised, when you signed the contract!" Last time I visited my project site, I didn't see any 8-year olds swinging on jungle-gyms.

    William Beyer, FAIA:

    Where to start?

    The article sub-head, "Using specifications and drawing notes to create an end-run around the contract", is odd, because the specifications and notes ARE PART OF THE CONTRACT.

    And, as an attorney, (or as someone who reads and unerstand the English language), the author should be expected to know that "The General Conditions of the Contract for Construction", which outline the Architect's contractual obligations for submittal review, are also PART OF THE CONTRACT.

    Not being an historian of the AIA Documents, I can't say with complete certainty, but I suspect that for at least 50 years, AIA's A201 General Conditions has required "sufficient time in the Architect's professional judgment to permit adequate review" of submittals, rather than specifying a fixed number of days.

    And finally, if there are conflicts between the Architect's documents and the Owner's "contract" with the GC, the Owner should think about getting a different attorney.

    -------------------------------------------
    Steven Shapiro
    Project Manager
    The Whiting-Turner Contracting Company
    Bethesda MD
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    Innovation Day: the CCA Symposium is on September 25. Earn 5.75 LUs, 2 of which are HSW. Click here to learn more and register


  • 2.  RE:The Architect-Contractor Smackdown: Using specifications and drawing notes to create an end-run around the contract

    Posted 04-29-2011 02:46
    The part of this blog reprint that struck me most was the ending: "By appearances, the architectural community has recently expanded the reach of the specifications and drawing notes to place undue risk to the contractor. As a construction manager and allied member of the AIA, I appreciate the agenda of the architects. The zeal to re-allocate risk to the contractor is now beyond the norm...Legal disputes, or perhaps battles of negotiation, are likely brewing between the GC community and developers, and, by extension, architects.  In the near-future, I would expect to see contractors seeking to limit the power of the architects to set forth their working relationship. In the absence of resolution, I can envision litigation to resolve these issues."

    First of all, this passage makes it seem like architects are (or were in 2008) transferring project risks unilaterally to contractors based on their own whim (or "zeal" and "the agenda of the architects" as Shapiro puts it--making it sounds like there's some sort of conspiracy brewing between firms). I disagree with this assertion. Second, I don't know what is meant by "undue risk". I can tell you what my experience has been from 1998 through 2010: changes to standard notes and specifications were almost always initiated by construction occurrences that were considered a problem by general contractors, building owners or both. Potential changes to standard notes and specifications were often reviewed by one or more frequent clients and one or more frequent general contractors working on projects coming out of the office. They commented on contractual impacts, schedule impacts and cost impacts. The objective in every case was to make the process and the product more predictable for everyone involved--in other words: to mitigate risk. In some cases the result clearly transferred risk from the owner to the contractor and in some cases it was to mitigate risk to the contractor (generally reducing construction costs). But the key was mitigating risk in a way that was predictable and biddable. When the contractor assumed greater risks, he or she was compensated for it--and the contractor was responsible for quantifying that additional risk and including it in the bid.

    Finally, architects have never held all the cards in contractor/owner/architect relationships. Contractors have always had the power to establish their own relationship with owners and they have always done so. Furthermore, contractors have always had just as much (or more) "face-time" with owners, with the construction phase of a project usually being the longest phase and the phase requiring the most attention. In my experience, relationships generally establish levels of trust and trust leads to influence with owners, not whether one is an architect or a contractor. I have seen many circumstances where owners trust the advice of contractors more than that of architects for that reason.

    I do agree with the blog respondents who said that the specifications and drawing nots are PART OF the contract, therefore they can't be in opposition to it and that most of the problems raised in the blog are simply a lack of coordination between components of the contract documents. But in the end, who holds the power is decided more by trust than by contract documents. And a well-coordinated set of contract documents is biddable--they don't contain any surprises. You can't sue your way to trust and you can't sue your way out of a non-responsive bid.

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    Sean Catherall, AIA
    Herriman, UT
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    Innovation Day: the CCA Symposium is on September 25. Earn 5.75 LUs, 2 of which are HSW. Click here to learn more and register


  • 3.  RE:The Architect-Contractor Smackdown: Using specifications and drawing notes to create an end-run around the contract

    Posted 04-29-2011 20:38

    All of the jockeying around, the bickering, friction and confrontational environment between architects and contractors is to the detriment of the owner and the finished product and it is inconceivable that it continues. It's unprofessional.

     

    As an architect working as owner's representative for more than 20 years, all on projects outside of the US, I have put together design and construction teams very early in a project and in a cooperative environment have promoted

    • thorough preparation in programming, design, costing,
    • open book accounting after receipt of bids,
    • sharing of information,
    • understanding of processes by project participants,
    • innovative thinking,
    • project discipline,
    • and above all, putting the project in first place in the knowledge that the single purpose of our work is the completion of a building on time, on cost, to the requirements of the owner.

     

    With positive leadership it's surprising how quickly differences vanish.



    -------------------------------------------
    Karl Hartnack AIA
    Component Past President
    Hartnack Architecture
    Duesseldorf Germany
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    Innovation Day: the CCA Symposium is on September 25. Earn 5.75 LUs, 2 of which are HSW. Click here to learn more and register