Content.

Synopsis

Purpose

Related documents

Significant features

Changes from the previous edition

Dispute Resolution—Mediation and Arbitration

 

Synopsis.

AIA Document B104–2017 is intended for use on construction projects of limited scope and complexity.

AIA Document B104–2017 is intended for use on construction projects of limited scope and complexity. B104-2017 replaces B104-2007, Standard Form of Agreement Between Owner and Architect for a Project of Limited Scope. B104-2017 is an abbreviated version of B101™–2017. B104 contains a compressed form of basic services with three phases: design, construction documents, and construction. This document may be used with a variety of compensation methods. B104–2017 is intended to be used in conjunction with A104™–2017, Standard Abbreviated Form of Agreement Between Owner and Contractor, which it incorporates by reference. 

For more complex projects, parties should consider using one of the following AIA owner/architect agreements: B101–2017 or B103™–2017. For smaller and less complex projects, parties may wish to consider B105™–2017, Standard Short Form of Agreement Between Owner and Architect.

For use and execution of a document, see its instructions  »

 

Purpose. 

AIA Document B104–2017 is a standard abbreviated form of agreement between Owner and Architect for building design and construction contract administration. B104–2017 is an abbreviated version of AIA Document B101–2017, Standard Form of Agreement between Owner and Architect, and it is intended for use on construction projects of limited scope and complexity. B104 contains a compressed form of basic services with three phases: design, construction documents, and construction. This document may be used with a variety of compensation methods, including percentage of construction cost and stipulated sum. 

B104–2017 assumes that the Architect will provide cost estimates and will design the Project to meet the Owner’s budget for the Cost of the Work. If the Owner will retain a third party to provide cost estimates, or if the Project will implement fast track, phased or accelerated scheduling, the parties should consider using AIA Document B103–2017, Standard Form of Agreement Between Owner and Architect for a Complex Project.

 

B104–2017 is intended to be used in conjunction with AIA Document A104–2017, Standard Abbreviated Form of Agreement Between Owner and Contractor, which it incorporates by reference. B104–2017 also can be used with Architect-Consultant agreements such as AIA Document C401™–2017. Before transmitting Instruments of Service or other information in digital form, parties should establish protocols for that transmission and may use AIA Document E203™–2013, Building Information Modeling and Digital Data Exhibit, for that purpose.

 

Significant features.

Standard of Care. B104–2017 contains a provision at Section 2.1 stating the applicable standard of care under which the Architect shall perform its services. 

Copyright and Licensing of the Instruments of Services. In B104–2017, the Architect and the Architect’s consultants are deemed the authors and owners of their respective Instruments of Service, and they retain all common law and statutory rights, including copyright. The Owner receives a license to use the Instruments of Service solely and exclusively for constructing, using, maintaining, altering and adding to the Project. This license will only terminate if the Architect rightfully terminates the Agreement for cause due to the Owner’s default. In the absence of such a termination by the Architect, the Owner retains the license to use the Instruments of Service after completion of the Project or the Owner’s termination of the Agreement. If the Owner subsequently uses the Instruments of Services without retaining the author of the Instruments of Service, the Owner agrees to release and indemnify the Architect for such uses. If the Owner rightfully terminates the Agreement for cause, however, the Owner is not required to release and indemnify the Architect for its further use of the Instruments of Service. If the Owner terminates the Agreement for its convenience, or the Architect terminates the Agreement due to the Owner’s suspension of the Project, B104 provides at Section9.7.2 for the Owner to pay a licensing fee to the Architect for the Owner’s continued use of the Architect’s Instruments of Service. 

Binding Dispute Resolution. Mediation is a condition precedent to any form of binding dispute resolution, but binding arbitration is not mandatory for disputes that fail to settle in mediation. Instead, the parties are required to select at Section 8.2.3 from three choices of binding dispute resolution: (1) arbitration, (2) litigation or (3) another method that they must identify.

 

Changes from the previous edition.

Document B104–2017 contains a number of significant format and content changes from B104–2007. A key formatting change between B104–2017 and B104–2007 is that B104–2017 reformats the Additional Services article. B104–2007 included two types of Additional Services: 1) Additional Services that were identified and contracted for at the time the Agreement was executed, and 2) Additional Services that arose as the Project proceeded. To avoid the potential confusion caused by having two types of Additional Services, B104–2017 has re-categorized the first type of Additional Services as Supplemental Services. Accordingly, in B104–2017, Supplemental Services refers to services that are not included as Basic Services but that are identified as the Architect’s responsibility at the time the Agreement is executed. Additional Services now refer only to those services that may arise as the Project proceeds. 

There are many other changes to foster clarity in the B104 Owner-Architect agreement as well. Described below are highlights of major changes in B104–2017, Standard Abbreviated Form of Agreement Between Owner and Architect. 

Article 1 – Initial Information

§ 1.3 Use of Digital Data. This section requires the development of protocols for the transmission of Instruments of Service or other data in digital form through the use of AIA Document E203™–2013, Building Information Modeling and Digital Data Exhibit. 

§ 1.3.1 This new section requires the parties to develop protocols for the use of, and reliance on, a building information model or portion thereof. Use of, or reliance on, a building information model without established protocols will be at the using or relying parties’ sole risk. This provision requires the use of AIA Document E203–2013 and AIA Document G202™–2013, Project Building Information Modeling Protocol Form, for the establishment of these protocols. For more information on using the AIA’s Digital Practice Documents, including E203–2013 and G202–2013, please see AIA’s Guide, Instructions and Commentary to the 2013 AIA Digital Practice Documents.

Article 2 – Architect’s Responsibilities

§ 2.2 Architect’s Insurance Requirements. Section 2.2 contains a new provision wherein the parties may set forth the types and limits of insurance the Architect is required to carry for the Project. Specifically, B104–2017 lists General Liability, Automobile Liability, Workers’ Compensation, and Professional Liability. 

Article 4 – Supplemental and Additional Services

As noted above, B104–2007 included two types of Additional Services: 1) Additional Services that were identified and contracted for at the time the Agreement was executed, and 2) Additional Services that arose as the Project proceeded. B104–2017 re-categorizes the first type of Additional Services as Supplemental Services. In B104–2017, Additional Services only refers to those services that may arise as the Project proceeds. 

Article 5 – Owner’s Responsibilities

§ 5.2 Owner’s Budget. Section 5.2 has been edited to clarify the Owner’s responsibility with regard to updating the Owner’s budget for the Project. 

Article 6 – Cost of the Work

§ 6.7 Architect’s Redesign Obligation. B104–2017 required the Architect to provide redesign services without additional compensation if the lowest bona fide bid or negotiated proposal exceeded the Owner’s budget for the Cost of the Work. This obligation remains in B104–2017, however, an exception has been added, stating that the redesign services shall be compensated as an Additional Service if the lowest bona fide bid or negotiated proposal exceeds the Owner’s budget due to market conditions the Architect could not reasonably anticipate. This approach is more similar to that taken under the Federal Acquisition Regulations’ design within funding limitations obligation, where an architect’s redesign efforts would be compensated if the unfavorable bids or proposals exceeding the budget are the result of conditions beyond the architect’s reasonable control. (Design Within Funding Limitations 48 CFR 52.236-22). 

Article 9 – Termination or Suspension

§ 9.6 Costs Attributable to Termination. This provision has been revised to clarify that costs payable to the Architect under a termination for convenience include costs attributable to the Architect’s termination of consultant agreements. 

§ 9.7 Termination Fee. A fill point has been added for the parties to identify the termination fee that the Owner would pay to the Architect in the event of a termination for convenience or if the Architect terminates because of an extended suspension of the Project, as well as a Licensing Fee if the Owner intends to continue to use the Architect’s Instruments of Service. 

§ 9.8 One-year Termination. A provision was added that terminates the Agreement one year from the date of Substantial Completion, unless otherwise stated in the Agreement. There are a number of provisions throughout the Agreement, such as Article 7 Copyrights and Licenses, where the terms and conditions will survive termination of the Agreement. 

Article 11 – Compensation

§ 11.1 Compensation for Basic Services. Fill points have been added for two of the more popular methods for compensating Architects for Basic Services: Stipulated Sum and a Percentage Basis. Section 11.1 also includes a space for users to insert another compensation method, such as hourly billing rates or a multiple of direct salary expense, if the parties so choose. 

§ 11.6 Calculation of Progress Payments For Percentage Basis Compensation. Language has been added to clarify how progress payments to the Architect are calculated when the parties have chosen a percentage basis as the method of compensation for the Architect’s Basic Services. Progress payments are calculated by applying the percentages set forth in Article 11 to the Owner’s most recent budget for the Cost of the Work. Section 5.2 requires the Owner to update its budget for the Cost of the Work as part of its budget for the Project throughout the course of the Project. Section 11.6 also clarifies that once a progress payment is made, it shall not retroactively be adjusted based on subsequent increases or decreases to the Owner’s budget for the Cost of the Work.

 

Dispute Resolution—Mediation and Arbitration.

This document contains provisions for mediation and arbitration of claims and disputes. Mediation is a non-binding process, but is mandatory under the terms of this agreement. Arbitration may be mandatory under the terms of this agreement. Arbitration is binding in most states and under the Federal Arbitration Act. In a minority of states, arbitration provisions relating to future disputes are not enforceable but the parties may agree to arbitrate after the dispute arises. Even in those states, under certain circumstances (for example, in a transaction involving interstate commerce), arbitration provisions may be enforceable under the Federal Arbitration Act.

The AIA does not administer dispute resolution processes. To submit disputes to mediation or arbitration or to obtain copies of the applicable mediation or arbitration rules, contact the American Arbitration Association at (800) 778-7879 or visit the website at adr.org.