Construction Contract Administration

Community HTML

A crane

Quick Links

Who we are

The Construction Contract Administration Knowledge Community (CCA) has been established to help our members better understand the issues, actions and resultant impact of the decisions required in this often neglected part of Project Delivery. It is our goal to provide clear answers to issues of concern to the Institute’s membership and share case studies and best practices. We further hope to provide guidance and direction in developing guidelines for new and evolving approaches to Project Delivery as well as guidance in the continuing education of our emerging young professionals.

How to connect

- Join to get occasional emails with new content and resources.
- Post on the discussion board to ask questions and share ideas.
- Read a CCA white paper - or contribute your own!
- Attend an upcoming event such as webinars and conferences.
- Provide feedback on what you'd like to see from your CCA community at cca@aia.org.

Expand all | Collapse all

Ability of One Party to Make Architect's Initial Decision Binding on the Other with No Other Recourse ( Art. 15.2.6.1 of A201 2017 Gen. Cond.)

  • 1.  Ability of One Party to Make Architect's Initial Decision Binding on the Other with No Other Recourse ( Art. 15.2.6.1 of A201 2017 Gen. Cond.)

    Posted 07-27-2021 10:41 AM

    Hopefully the community can help my understanding of this...  I've never been completely clear on how the dispute resolution mechanism in the General Conditions operates because some of the wording is non-intuitive.  Specifically, I'm hoping for clarification of the underlined part of Article 15.2.6.1 (see below) which reads:

    "§ 15.2.6.1 Either party may, within 30 days from the date of receipt of an initial decision, demand in writing that the other party file for mediation. If such a demand is made and the party receiving the demand fails to file for mediation within 30 days after receipt thereof, then both parties waive their rights to mediate or pursue binding dispute resolution proceedings with respect to the initial decision.(similar language appears in 15.3.3 and was also in the 2007 version of A201)

    If I'm reading this correctly, if the Initial Decision-Maker's decision is in favor of Party A, but Party B disagrees with that initial decision, then Party B can demand mediation.  That's clear so far, but here comes the troublesome part:  If Party A (which likes the initial decision) decides to wait it out for 30 days and does not file for mediation, then the effect is that both parties' rights for further dispute resolution are waived and the initial decision becomes binding.  That leaves Party B no recourse (mediation or subsequent arbitration/litigation).  Is that how you all are reading this?  Anyone have experience with it?

    I realize the alternate methods of dispute resolution such as mediation or binding arbitration depend on both parties being willing to participate, but the provision and example above seems to also remove from Party B the right to sue/litigate and compel Party A to participate in any other means of resolving the dispute.  Is that so?

    Thanks in advance for your thoughts!
    -Tim



    ------------------------------
    Timothy Aho AIA
    President/CEO
    Aho Architects, LLC
    Hoover AL
    ------------------------------
    Open: Call for leaders. Applications due by Monday, November 8 at 5pm Eastern. Click here to view and apply to join the CCA leadership group!


  • 2.  RE: Ability of One Party to Make Architect's Initial Decision Binding on the Other with No Other Recourse ( Art. 15.2.6.1 of A201 2017 Gen. Cond.)

    Posted 07-29-2021 08:56 AM

    It is important to consider the context and the entire document.

     

    15.2.6 Either party may file for mediation of an initial decision at any time, subject to Section 15.2.6.1.

     

    15.2.6.1 contains an import "IF"..."then" clause.

     

    If a party wishes to force the issue, then that party can demand mediation, which requires a response or results in a waiver.

     

    If no one makes a demand for mediation, then 15.2.6 remains in effect, as does 15.4, arbitration.

     

    Bolazina

    Dennis Bolazina

    14A North Central Ave

    Clayton, MO 63105

    314-721-7500

     

     

    Bolazina

    Dennis Bolazina

    14A North Central Ave

    Clayton, MO 63105

    314-721-7500

     




    Open: Call for leaders. Applications due by Monday, November 8 at 5pm Eastern. Click here to view and apply to join the CCA leadership group!


  • 3.  RE: Ability of One Party to Make Architect's Initial Decision Binding on the Other with No Other Recourse ( Art. 15.2.6.1 of A201 2017 Gen. Cond.)

    Posted 07-29-2021 01:22 PM
    This is defined in the A101 document part 6.2. That language sets the method of Binding Dispute Resolution. So, if mediation is not pursued by both parties, then the matter can be settled as defined by the terms of 6.2 following the procedures of Section 15.3.3 of A201, which states that 60 days after request for mediation by one party, they may pursue binding dispute resolution. As notification is also required to be sent to the mediator, and then to the arbitrator (or courts if arbitration is not selected) for binding dispute resolution, it is reasonable to conclude that the party failing to agree to mediation and/or binding dispute resolution is in violation of the contract, (A101 part 6.2. and the General Conditions A201 parts 15.1.2, 15.3.1 and 15.4.1) as they have agreed by contract to settle disputes per those terms. In addition, neither party waives any rights they might otherwise be entitled, per Section 13.3 of the A201, due to failure of the other party to act.

    It is not the intent of the contract to limit one parties' rights due to the action, or inaction of the other party.




    ------------------------------
    Jeffery Reynolds AIA
    HOK
    Washington DC
    ------------------------------

    Open: Call for leaders. Applications due by Monday, November 8 at 5pm Eastern. Click here to view and apply to join the CCA leadership group!


  • 4.  RE: Ability of One Party to Make Architect's Initial Decision Binding on the Other with No Other Recourse ( Art. 15.2.6.1 of A201 2017 Gen. Cond.)

    Posted 07-29-2021 04:00 PM
    Thank you Jeffery.  That makes [common] sense, but why then is § 15.2.6.1 even necessary or included?  What's its intent?  I could see it if § 15.2.6.1 only mentioned waiving mediation, but it also goes on to mention waiving binding dispute resolution (arbitration or litigation) too.  Could the intent be to limit the time within which the initial decision can be "appealed" to mediation?  Could the intent be that the party disagreeing with the initial decision (Party B in my original illustration) has 30 days to "appeal" and demand mediation, after which Party A has the next 30 days to agree to mediate, then absent Party A's willingness to mediate, binding dispute resolution (arbitration or litigation) kicks-in?  I could see that as a means of keeping things moving along while protecting both parties' rights, but again, I come back to wondering why § 15.2.6.1 speaks of waiving both mediation and binding dispute resolution (as does § 15.3.3).

    ------------------------------
    Timothy Aho AIA
    President/CEO
    Aho Architects, LLC
    Hoover AL
    ------------------------------

    Open: Call for leaders. Applications due by Monday, November 8 at 5pm Eastern. Click here to view and apply to join the CCA leadership group!