Cornerstone - Fall 2017 - 16

The Revised AIA
Prime Contract
In April 2017, the American Institute of Architects issued its once-a-decade update to its prime
contract, subcontract and design agreement forms. In light of the popularity of the forms and
their infrequent revision, it is important to understand what changes may affect your business.
This article outlines some of the more significant changes to the A101, A102 and A201 forms-
often utilized by owners and contractors and whose terms often flow down to subcontractors.

BY TIM ROSS,
SHAREHOLDER,
ANDREWS MYERS, PC

blank for the parties to specify the percentage withheld.
Termination for Convenience: The
revised A101 continues to allow the owner
to terminate the contract for convenience
but adds a termination for convenience
fee payable to the contractor. The parties
may negotiate the amount of the termination for convenience fee and include it in
this section.
Insurance and Bonds: The revised A101
includes a separate exhibit to allow the parties to more specifically detail the project's
bonding and insurance requirements. The
insurance exhibit is a significant departure from the previous AIA documents and
the revisions to the insurance language
are numerous.

generally, rather than specifying each type
of transmission, reproduction, and other
costs that should be reimbursed. Bonuses,
profit sharing and other discretionary payments to those hired by the contractor are
now costs that will not be reimbursed.
Schedule of Values/Guaranteed
Maximum Price: The revised A102 now
specifies that the schedule of values for
progress payments will contain an additional line item for costs that are included
in the guaranteed maximum price contract
but not allocated to any other line item.
Additionally, the revised A102 clarifies that
the guaranteed maximum price is the total
of all items contained in the schedule of
values, rather than a separate guaranteed
maximum price for each specific line item.

A102-2017 Cost Plus Fee with
Guaranteed Maximum Price
Contract ("A102")
The revised A102 contains the same
language as the revised A101 for the following sections: Date of Commencement
and Substantial Completion; Liquidated
Damages/Incentives; Progress Payment
Calculations; Retainage; Termination for
Convenience; Insurance and Bonds
Costs Reimbursed/Costs Not Reimbursed: While the prior version of the
A102 only allowed reimbursement for the
wages/salaries of the contractor's personnel for work performed at the contractor's
offices, the revised A102 presumes that the
contractor will be reimbursed for wages/
salaries for work performed at a location
other than the project site. Further, the contract anticipates that the contractor will
be reimbursed for costs of the site office

A201-2017 General
Conditions of the Contract
for Construction ("A201")
Written Notice/Electronic Notice: The
revised A201 adds electronic transmission
as a method of providing all contractual
notices-except for notice of claims, which
must still be served only by courier or by
certified or registered mail.
Evidence of Owner's Financial Arrangements: The revised A201 still allows the
contractor to request reasonable evidence
of the owner's financial arrangements, but,
under the revised terms, the contractor is
not obligated to commence work on the
project if the owner fails to provide this
evidence. Like in the prior version, the
contractor can request proof of financing
after construction begins if: (1) the owner
fails to pay contractor, (2) the contractor
identifies reasonable concern regarding

A101-2017 Stipulated Sum
Contract ("A101")
Date of Commencement and Substantial Completion: The revised A101
provides a check-the-box option for the
dates of commencement and substantial
completion. For date of commencement,
the parties may select: the date of the
agreement, the date designated in the
owner's notice to proceed or a mutually
agreed date. For the date of substantial
completion, the parties may select a specified date or designate the number of days
from the date of commencement.
Liquidated Damages/Incentives: Prior
to the revisions, parties and their lawyers
often added liquidated damages and early
completion bonus provisions to the A101.
The revised A101 now contains blanks
that the parties can fill in to include liquidated damages and for bonuses/incentives (presumably for early completion) in
the contract's total sum. The presence of
the blanks, like the check-the-box option
above, make it more likely that parties will
negotiate these terms into their agreement.
Progress Payment Calculations: While
the final calculation may not differ significantly (or at all), the revised A101 clarifies
the process for calculating progress payments. Rather than including reductions in
the initial calculation, the revised A101 first
calculates all monies due for each progress
payment and then reduces that amount
by prior payments, defects, retainage and
other proper reductions.
Retainage: The revised A101 contains
a more detailed retainage provision,
including a default assumption that the
retainage will be withheld and providing a
16

Cornerstone



Table of Contents for the Digital Edition of Cornerstone - Fall 2017

From the Chairman of the Board, James Bryant
From the President/CEO, Jerry Nevlud
Houston-Area Construction Companies Team Up to Promote National Safety Stand-Down
OSHA Launches Application to Electronically Submit Injury, Illness Data
Midyear Safety Meeting and Networking Breakfast Recognizes Excellence in Safety
The Revised AIA Prime Contract
New Technologies Present New Liabilities
AGC Houston Members Head to Pacific Northwest for State Convention
Menil Drawing Institute Gets Ready to Open Its Doors
Member News
Index of Advertisers/Advertiser.com
Cornerstone - Fall 2017 - Intro
Cornerstone - Fall 2017 - ebelly1
Cornerstone - Fall 2017 - ebelly2
Cornerstone - Fall 2017 - cover1
Cornerstone - Fall 2017 - cover2
Cornerstone - Fall 2017 - 3
Cornerstone - Fall 2017 - 4
Cornerstone - Fall 2017 - 5
Cornerstone - Fall 2017 - From the Chairman of the Board, James Bryant
Cornerstone - Fall 2017 - 7
Cornerstone - Fall 2017 - 8
Cornerstone - Fall 2017 - From the President/CEO, Jerry Nevlud
Cornerstone - Fall 2017 - Houston-Area Construction Companies Team Up to Promote National Safety Stand-Down
Cornerstone - Fall 2017 - 11
Cornerstone - Fall 2017 - 12
Cornerstone - Fall 2017 - OSHA Launches Application to Electronically Submit Injury, Illness Data
Cornerstone - Fall 2017 - Midyear Safety Meeting and Networking Breakfast Recognizes Excellence in Safety
Cornerstone - Fall 2017 - 15
Cornerstone - Fall 2017 - The Revised AIA Prime Contract
Cornerstone - Fall 2017 - 17
Cornerstone - Fall 2017 - 18
Cornerstone - Fall 2017 - New Technologies Present New Liabilities
Cornerstone - Fall 2017 - AGC Houston Members Head to Pacific Northwest for State Convention
Cornerstone - Fall 2017 - 21
Cornerstone - Fall 2017 - 22
Cornerstone - Fall 2017 - Menil Drawing Institute Gets Ready to Open Its Doors
Cornerstone - Fall 2017 - Member News
Cornerstone - Fall 2017 - 25
Cornerstone - Fall 2017 - Index of Advertisers/Advertiser.com
Cornerstone - Fall 2017 - cover3
Cornerstone - Fall 2017 - cover4
https://www.nxtbook.com/naylor/HCAQ/HCAQ0118
https://www.nxtbook.com/naylor/HCAQ/HCAQ0417
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