AIA Releases Updated Construction Contract Forms

By Wayne Maiorano, Peter Marino, Anna Osterhout and Gray Wilson

The American Institute of Architects (AIA) recently released the 2017 edition of eleven standard construction and design contract forms, and it plans to release revisions to an additional eighteen forms in the fall of 2017. The AIA documents are the most widely used form contracts in the construction and development industry. AIA has historically updated its forms every ten years in order to ensure that they reflect changes and current trends in the industry. The 2017 update revises the prior 2007 version of several key forms. Some of the more notable forms impacted by the 2017 update include the B101: Owner–Architect agreement, and the A101/A201: Owner–Contractor base agreement and general conditions.[1] While there are a number of substantive changes requiring careful review, the following are among the more significant revisions included in the 2017 updates:

Notable Revisions to Owner/Architect Documents:

• The definitions of the Architect’s “Basic Services” and “Additional Services” have been modified. Services that are not included in Basic Services but that are identified at the time of contracting are referred to in the new 2017 update as “Supplemental Services” (rather than “Additional Services”). The term “Additional Services” now refers only to those services beyond Basic Services that arise during the course of the project.
• Rather than including a separate set of documents for “green” or sustainable construction projects, the 2017 update includes a single Sustainable Projects Exhibit that can be used in conjunction with the base AIA forms as appropriate
• New forms include prompts to address terms related to termination fees when an Owner terminates for convenience or an Architect terminates following the Owner’s suspension of work.
• Clarification is provided regarding calculation of an Architect’s progress payments when compensation is calculated on a percentage of project cost basis.

Notable Revisions to Owner/Contractor Documents:

• Streamlined provisions governing the calculation of progress payments and the payment application process.
• Revised insurance and bond provisions that are addressed by reference to a new Insurance and Bonds Exhibit that works with many of the AIA Owner–Contractor agreement forms. Some key differences between the revised insurance provisions and the prior 2007 form insurance provisions include the new form’s distinction between required coverages and optional coverages, and the requirement that the Owner provide notice to the Contractor within three business days of becoming aware of an impending or actual cancellation or expiration of required insurance. While substantive terms regarding insurance requirements are now addressed in the Insurance and Bonds Exhibit in the new forms, the A201-2017 form still also includes in its text certain key insurance terms that are applicable to most projects.
• Acknowledgement that the Owner and Contractor may communicate with each other directly and do not need to include the Architect in communications unless the substance of the communication affects the Architect’s services and responsibilities
• Clarification that, upon written request by Contractor, the Owner must provide proof that it has made financial arrangements to pay for the project.
• New exhibit for Sustainable Projects (as noted under the Owner/Architect changes referenced above).

While the 2007 forms will be available from the AIA for use until October 31, 2018, the new 2017 versions of the forms are available for use now. Obviously, it is important to evaluate all of the changes in the forms and understand the implications those changes may have in managing the risks on a particular project. Complete comparisons of the revised 2017 forms and the 2007 forms are available on the AIA website.

Members of Smith Anderson’s Construction Group have deep experience working with the AIA contract forms and have contributed to the ABA Construction Law Forum’s A201 Desk Book set for release later in 2017. The A201 Desk Book provides an extensive guide to the new AIA General Conditions document and all of the recent changes. If you have questions about the new AIA forms and how they may affect your upcoming projects, the members of Smith Anderson’s Construction Group stand ready to help.

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[1] A full list of the updated forms is available at https://www.aia.org/press-releases/82526-2017-aia-contract-documents-now-available-.