Synopsis.

AIA Document A401®–2017 establishes the contractual relationship between the contractor and subcontractor. It sets forth the responsibilities of both parties and lists their respective obligations, which are written to parallel AIA Document A201®–2017, General Conditions of the Contract for Construction, which A401–2017 incorporates by reference. If another general conditions document will be used, such as A232™, General Conditions of the Contract for Construction, Construction Manager as Adviser, then A401–2017 will have to be modified to refer to that general conditions document instead of AIA Document A201–2017. Additionally, AIA Document A401–2017 may be modified for use as an agreement between the subcontractor and a sub-subcontractor, and must be modified if used with AIA Document A104™–2017 or A105™–2017 as the owner/contractor agreement. For all document details and a record of changes, see the summary »

Using A401–2017.

Cover Page

Date. The date represents the date the Agreement becomes effective. It may be the date that an oral agreement was reached, the date the Agreement was originally submitted to the other party, the date authorizing action was taken or the date of actual execution. It will be the date from which the Subcontract Time is measured unless a different date is inserted under Section 9.1.

Parties. Parties to this Agreement should be identified using the full legal name under which the Agreement is to be executed, including a designation of the legal status of both parties (sole proprietorship, partnership, joint venture, unincorporated association, limited partnership or corporation [general, limited liability, closed or professional], etc.). Where appropriate, a copy of the resolution authorizing the individual to act on behalf of the firm or entity should be attached. Other information may be added, such as telephone numbers and electronic addresses.

Prime Contract. The date of the Agreement between the Owner and Contractor should be entered.

Owner. The name and address of the Owner should be the same as used in the Prime Contract.

Project. The proposed Project should be described in sufficient detail to identify (1) the official name or title of the facility, (2) the location of the site, and (3) a brief description of the Project, including the proposed building usage, the size, and capacity or scope of the Project.

Architect. The Architect’s full legal or corporate titles should be used.

Article 6 – Mediation and Binding Dispute Resolution

§ 6.2 Select from three choices of binding dispute resolution: (1) arbitration, (2) litigation or (3) another method that the parties must identify. Other types of dispute resolution include a dispute resolution board or a mini-trial. For additional information about other methods of dispute resolution, refer to The Construction Industry’s Guide to Dispute Avoidance and Resolution or visit adr.org for more information.

Article 8 – The Work of this Subcontract

Identify and describe the precise scope of Work required by the Subcontract, referencing, where appropriate, numbers of Drawings, Specifications sections, pages of any addenda, Modifications, and any accepted alternates. While describing the scope of Work will help to avoid later disputes, it is equally important to describe any specifically excluded Work that will be the responsibility of others.

Article 9 – Date of Commencement and Substantial Completion

§ 9.1 The date of commencement of the Work should be identified by checking the appropriate box. The date of commencement could be the date of this Agreement, a date set forth in a notice to proceed issued by the Owner, or another date using a method established by the parties. It is important to note that if a selection is not made, the default will be the date of the Agreement.

§ 9.2.2 The Subcontract Time may be expressed as a number of calendar days or as a specified date. Select the appropriate box and insert the date or number of days, as appropriate. If a specified date is used, and the date of commencement is to be given in a notice to proceed, these dates must be carefully coordinated to allow sufficient time for completion of the Work.

§ 9.2.3 The time within which the Subcontractor shall substantially complete the Work may be expressed as a number of calendar days or as a specified date.

Article 10 – Subcontract Sum

§ 10.1 Enter the Subcontract Sum payable to the Subcontractor.

§ 10.2.1 Identify any alternates described in the Subcontract Documents and accepted by the Contractor as included in the Subcontract Sum.

§ 10.2.2 List other alternates which may be accepted subsequent to execution of the Agreement, including the price of each alternate and the conditions for acceptance.

§ 10.3 Identify unit prices and state quantity limitations, if any, to which the unit price will be applicable. If unit prices are not covered in greater detail elsewhere in the Subcontract Documents, the following provision for unit prices is suggested:

The unit prices listed below shall determine the value of extra Work or changes in the Work, as applicable. They shall be considered complete and shall include all material and equipment, labor, installation costs, overhead, and profit. Unit prices shall be used uniformly for additions or deductions.

§ 10.4 Identify and state the amount of any allowances.

Article 11 – Progress Payments

§ 11.1.2 Insert the time period covered by each application for payment if it differs from the one given.

§ 11.1.3 Insert the time schedule for presenting applications for payment. Due dates for payment should be acceptable to both the Contractor and Subcontractor. They should allow sufficient time for the Contractor to prepare an Application for Payment, for the Architect to certify payment, and for the Owner to make payment. They should also be in accordance with the time limits established by this article and Article 9 of A201–2017 (see Related Documents section of the document summary regarding use of other General Conditions documents)

§ 11.1.8.1 Insert the percentage or amount of retainage, if any, to be withheld when computing the amount of each progress payment. The Subcontractor is usually paid the bulk of the earned sum when payments fall due, retaining a percentage to ensure faithful performance. These percentages may vary with circumstances and localities.

§ 11.1.8.1.1 Certain items included in the Subcontract Sum may be excluded from the calculation of retainage. Where there are any limitations or exclusions from retainage, list those items.

§ 11.1.8.2 The AIA endorses the practice of reducing retainage as rapidly as possible, consistent with the continued protection of all affected parties. A provision for reducing retainage should provide that the reduction will be made only if the Contractor judges that the Work is progressing satisfactorily. If the Subcontractor has furnished a bond, demonstration of the surety’s consent to reduction in or partial release of retainage must be provided before such reduction is effected. Use of AIA Document G707A™ is recommended. Insert terms for reduction or limitation of retainage.

§ 11.3.1 Insert any provision for earlier final payment to the Subcontractor. When final payment is requested, the Contractor should ascertain that all claims have been settled or should define those which remain unsettled. The Contractor must also determine that the Architect has issued a certificate for payment covering the Subcontractor’s completed Work and that the requirements of the Subcontract have been fulfilled.

§ 11.4 Payments due and unpaid under the Subcontract bear interest from the date payment is due at the legal rate prevailing from time to time at the place where the Project is located. If a different interest rate is to be paid, insert the amount here.

Article 12 – Insurance and Bonds

§ 12.1.1 Insert types of coverage and limits of liability to be maintained by the Subcontractor which may arise out of or result from the Subcontractor’s operations and completed operations under the Subcontract.

§ 12.1.3 Insert the duration after completion of the Work that the Subcontractor will be required to maintain professional liability insurance, if professional liability insurance is required.

§ 12.1.1 Where the Subcontractor is required to provide payment and performance bonds, indicate the penal sum of each bond in the space provided.

Article 13 – Temporary Facilities and Working Conditions

§ 13.1 List temporary facilities and services the Contractor will not furnish to the Subcontractor.

§ 13.2 List any of the Contractor’s equipment that will not be available to the Subcontractor.

§ 13.3 List any specific arrangements or requirements concerning working conditions and labor matters applicable to the Subcontractor’s Work.

Article 14 – Miscellaneous Provisions

§ 14.2 Identify the Contractor’s representative and provide contact information.

§ 14.3 Identify the Subcontractor’s representative and provide contact information.

§ 14.4.3 Section 14.4.1 allows the Contractor and Subcontractor to provide notice in electronic format. It is recommended that the parties use AIA Document E203™–2013, Building Information Modeling and Digital Data Exhibit, to establish the protocols for electronic communication. If AIA Document E203–2013 is not used, insert the requirements for delivering notice in electronic form, such as the name, title, and email address of the recipient and whether the system will be required to generate a read receipt (recommended), in Section 14.4.3. While notice in electronic form may be provided as set forth in this provision, other protocols for the use or transmission of digital data and BIM are established through the use of E203-2013, pursuant to Section 14.7.

Article 15 – Enumeration of Subcontract Documents

A detailed enumeration of all Subcontract Documents must be made in this Article.

Executing the agreement.

The persons executing AIA Document A401–2017 should indicate the capacity in which they are acting (i.e., president, secretary, partner, etc.) and the authority under which they are executing the Agreement. Where appropriate, a copy of the resolution authorizing the individual to act on behalf of the firm or entity should be attached.

ISO® is a registered trademark and Insurance Services Office™ and the titles of the ISO proprietary insurance forms identified herein are trademarks of Insurance Services Office, Inc. (“ISO”). Information which is copyrighted by and proprietary to Insurance Services Office, Inc. or its affiliates (“ISO Material”) is included and referenced in this publication. Use of the ISO Material is limited to ISO Participating Insurers and their Authorized Representatives and other licensees, in each case as licensed by ISO. Use by ISO Participating Insurers is limited to use in those jurisdictions for which the insurer has an appropriate participation with ISO. Use of the ISO Material by Authorized Representatives is limited to use solely on behalf of one or more ISO Participating Insurers, as licensed by ISO.

 

Important.

Modifications. Particularly with respect to professional or contractor licensing laws, building codes, taxes, monetary and interest charges, arbitration, indemnification, format and font size, AIA Contract Documents may require modification to comply with state or local laws. Users are encouraged to consult an attorney before completing or modifying a document.

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