Change # 9 to the AIA A201 General Conditions has to deal with the Owner’s Right to Carry Out the Work.  [Click here for the previous post on AIA Contract Changes.]

In prior versions of the General Conditions, if a contractor defaulted and the Owner (after giving notice) opted to cure by carrying out the work itself, an appropriate Change Order would be issued.  However, a Change Order is a contract that requires an agreement by both the Owner and Contractor, and, obviously, Contractors were reluctant to agree that they were in default and responsible for a deductive change order.

The new Section 2.5 allows the Owner to carry out the work if the Architect approves, without a signed change order.  Instead, the Architect can withhold or nullify a payment to the Contractor (under Section 9.5.1) to reimburse the Owner for the work carried out.

If the Contractor disagrees with the actions of the Owner or the Architect, or the amounts claimed as costs to the Owner, the Contractor can institute a Claim under the Claims section (Article 15) of the 201.

Up tomorrow, Change #8– Direct Communications on the Construction Project.

As promised in my note yesterday, today begins the first in a 10 part series on the most significant changes to the AIA A201, General Conditions to the Contract.

I’ll take the changes in reverse order, a la David Letterman…..

Change #10:  Differing Site Conditions

Previously, the A201 required a Contractor to provide notice to the Owner and Architect within 21 days after discovery of unforeseen site conditions.  This notification is required prior to the conditions being disturbed, so as to allow the Design Team the ability to evaluate the site and determine the compensability of any such differing conditions.

The requirement has been shortened to 14 days — that is, under the 2017 version, a Contractor must give the notification within 14 days of discovery.   See Section 3.7.4.

This is a small contract adjustment, but could prove substantially deprive a contractor of potential additional sums if caught unawares.  As the Architect or Engineer of Record, you should also be aware of this new 14 day requirement, which is a week shorter than most AIA deadlines.

Stay tuned for Change # 9, dealing with the Owner’s Right to Carry Out the Work, in the next post.

Photo courtesy NPS.

Like death & taxes, you can count on the American Institute of Architects (AIA) to regularly update their standard form construction contracts.  Most such forms are updated every 10 years, and 2017 was no exception.

In the 2017 version, the changes are “evolutionary, not revolutionary”, according to AIA Managing Director and Counsel, Kenneth W. Cobleigh.  Ken and I both recently spoke at the North Carolina Bar Association’s Construction Law Forum on various AIA changes.

Over the course of the next two weeks, I’ll be presenting a 10 Part Series on the Top 10 Changes that you need to know about the AIA A201 General Conditions.

Stay tuned for Part 1, on Differing Site Conditions, which will be posted tomorrow morning.

Picture adapted from Investment Zen, with thanks.