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Wednesday, May 3, 2017

Architect-Owner Agreement


UAP Document 401 provides the format for the Owner-Architect Agreement. However, since the adoption of the 2010 Standards of Practice (SPP) Documents by the PRBoA and the 2014 Architects Guidelines on Methods of Compensation and Schedule of Fees, the document has not yet been amended or updated. Here is a sample format for the contract which incorporated the 2010 SPP and 2014 Architects Guidelines. This sample contract can be used for the basic or full detailed architectural and engineering design (DAED) services. You may amend some provisions to suit your project requirements.


PROJECT      :           __________________
LOCATION     :        ___________________


OWNER-ARCHITECT AGREEMENT


THIS AGREEMENT, made and entered into this __ day of Month, Two Thousand and xxx by Mr. ________________ of legal age, Filipino and with postal address __________________, the party of the First Part, hereinafter called the OWNER and between ____________, a duly registered and licensed architect under the laws of the Republic of the Philippines with PRC Registration No __________, of legal age, Filipino and with postal address at ________________________, the party of the Second Part, hereinafter called the ARCHITECT.

WITNESSETH,

That whereas the OWNER intends to build a (project title) building at (lot number/street/barangay/municipality/city), hereinafter called the PROJECT.

NOW, THEREFORE,

The OWNER and the ARCHITECT, for and in consideration of the foregoing premises and of the other covenants hereinafter named, agree as follows:

ARTICLE 1.    SCOPE OF WORK

That the scope of work to be done by the Architect, as herein authorized by the Owner for the subject Project herein referred to, consists of professional services for the following:
1.01 Site development planning (SDP) of the grounds of the building, including other concomitant structures within the Project site, as may be determined by the Owner.
1.02 Basic (Regular) Detailed Architectural and Engineering (DA&E) Design of the Project to be located at ________________________________.

ARTICLE 2.    ARCHITECT’S BASIC SERVICES

The Architect’s Basic Services consist of the following:

2.01 Project Definition Phase

This phase involves the definition of the requirements of the project by the Owner. The Architect in turn informs the Owner of the technical requirements of the project and the concomitant professional fees. In this phase, the Architect:
2.01.01 consults with the Owner to ascertain the conceptual framework and related requirements of the project and confirms such requirements with him.
2.01.02 gathers relevant information and data leading to the definition of the requirements of the project, including the scope of the Architect’s services.
2.01.03 reviews and refines the owner’s space requirements and translates  them into an architectural program.
2.01.04 prepares an initial statement of probable construction cost.

2.02 Schematic Design Phase

This phase consists of the preparation of schematic design studies derived from the Project Definition Phase, leading to conceptual plans. The Architect:
2.02.01 evaluates the Owner’s program, schedule, budget, project site and proposes methods of project deliveries.
2.02.02 prepares the initial line drawings representing design studies leading to a recommended solution, including a general description of the project for approval by the Owner.
2.02.03 submits to the Owner a Statement of the Probable Project Construction Cost (SPPCC) based on current cost parameters.

2.03 Design Development Phase

Based on approved schematics and conceptual plans, the Architect prepares:
2.03.01 the Design Development documents consisting of plans, elevations, sections and other drawings,
2.03.02 outline specifications to fix and illustrate the size and character of the entire project as to type of materials, type of structural, electrical, mechanical, sanitary, electronic and communications systems.
2.03.03 diagrammatic layout of construction systems, and
2.03.04 an updated  SPPCC for submission to the Owner.

2.04 Contract Document Phase

Based on the approved Design Development Documents, the Architect:
2.04.01 prepares the complete Contract Documents consisting of detailed designs and construction drawings, setting forth in detail the work required for the architectural, structural, electrical, plumbing/ sanitary, mechanical, electronic and communication works prepared by the Architect and the respective professionals involved.
2.04.02 prepares Technical Specifications describing type and quality of materials, finish, manner of construction and the general conditions under which the project is to be constructed.
2.04.03 submits to the Owner seven (7) sets of all construction drawings and technical specifications for purposes of obtaining a building permit.
2.04.04 updates the SPPCC based on changes in scope, requirements or market conditions.
2.04.05 assists the Owner in filing the required documents to secure approval of government authorities having jurisdiction over the design of the Project.

2.5 Bidding or Negotiation Phase

2.05.01 In this phase, the Architect:
a. prepares the Bid Documents such as forms for contract letting, documents for construction, forms for invitation and instruction to bidders, forms for bidders’ proposals, general / specific conditions of contract, etc.
b. assists the Owner from the early stage of establishing a list of prospective Contractors to awarding of the construction contract.

2.05.02 For competitive bids / procurements, the Architect:
a. furnishes complete sets of the Bid Documents for purposes of bidding in as many sets as may be required to conduct a successful bidding. The said documents are loaned to bidders at an amount sufficient to cover direct and indirect costs attendant to the preparation, packaging, reproduction and delivery of the said documents.
The Bid Documents are the intellectual property of the Architect (Sec. 33 of R.A. No. 9266), and must be returned by all entities acquiring bid documents. A bond may be required to assure the return of the Bid Documents.
The Architect retains the sole ownership and copyright to the said documents (Sec. 33 of R.A. No. 9266). As such, bidders must not reproduce nor use the documents for unauthorized purposes. The Owner also must not use the documents for any other purpose other than the project for which the Owner and Architect signed an agreement.
b. helps in organizing and conducting pre-bid conferences,
c. responds to questions from bidders,
d. assists the Owner in obtaining proposals from Contractors, analyzes bid results and prepares abstract of bids, notice of award, notice to proceed and other construction contracts.

2.05.03 For negotiated contracts, the Architect performs similar functions as in item 2.5.2 but negotiates with one Contractor instead of many bidders.

2.06 Construction Phase

In this phase, the Architect performs the following:
2.06.01 makes decisions on all claims of the Owner and Contractors on all matters relating to the execution and progress of work or the interpretation of the Contract Documents.
2.06.02 prepares change orders, gathers and turns over to the Owner written guarantees required of the Contractor and Sub-Contractors.
2.06.03 makes periodic visits to the project site to familiarize himself with the general progress and quality of work and to ascertain that the work is proceeding in accordance with the Contract Documents. The Architect shall not be required to make exhaustive or continuous 8-hour on-site supervision to check on the quality of the work involved and shall not be held responsible for the Contractor's failure to carry out the Construction work in accordance with the Contract Documents. During such project site visits and on the basis of his observations, he shall report to the Client defects and deficiencies noted in the work of Contractors, and shall condemn work found failing to conform to the Contract Documents.
2.06.04 determines the amount owing and due to the Contractor and issues corresponding Certificates for Payment for such amounts based on his observations and the Contractor's Applications for Payment. These Certificates will constitute a certification to the Client that the work has progressed to the state indicated and that to his best knowledge, the quality of work performed by the Contractor is in accordance with the Contract Documents. The Architect shall conduct the necessary inspection to determine the date of substantial and final completion and issue the final Certificate of Payment to the Contractor.
2.06.05 Should more extensive inspection or full-time (8-hour) construction supervision be required by the Client, a separate full-time supervisor shall be hired and agreed upon by the Owner and the Architect subject to the conditions provided in the SPP Document on Full -Time Supervision. When the Architect is requested by the Owner to do the full time supervision, his services and fees shall be covered separately in conformance with the applicable and appropriate SPP Document.


ARTICLE 3.    ARCHITECTS’ FEE AND MANNER OF PAYMENTS

3.01 That the Owner agrees to pay the Architect for professional services, a fee of ____________________, with other payments and reimbursements hereinafter provided, exclusive of twelve percent (12%) Value-Added Tax (VAT), the said amount hereinafter called the Basic Rate.

3.02 Payments to the Architect on account of the agreed Professional Fee shall be made by the Owner on the different phases of the work of the Architect as follows:

3.02.01 Upon signing of the Service Agreement:  An amount equivalent to 5% of the agreed Professional Fee shall be paid by the Owner as engagement fee or as the acceptance fee of the Architect that shall cover the mobilization component of the services. The Professional Fee shall be computed based on the Statement of Probable Project Construction Cost (SPPCC) as included in the Annex of the Service Agreement.

3.02.02 Upon the completion of the Schematic Design Phase: Upon completion and submission of the documents under Schematic Design Phase as stipulated in the Service Agreement, but not more than 15 days after submission of the documents to the Owner, the Owner shall pay the Architect a sum equal to fifteen percent (15.0%) of the Professional Fee, or a sum sufficient to increase the total payments on the fee to twenty (20.0%) percent of the Professional Fee (amount paid under Section 3.02.01 shall be deducted from the total amount). The Professional Fee shall be computed based on the Statement of Probable Project Construction Cost (SPPCC) that shall be part of the documents to be submitted at this particular stage.

3.02.03 Upon the completion of the Design Development Phase: Upon completion and submission of the documents under Design Development Phase as stipulated in the Service Agreement, but not more than 15 days after submission of the documents to the Owner, the Owner shall pay the Architect a sum equal to twenty percent (20.0%) of the Professional Fee, or a sum sufficient to increase the total payments on the fee to forty (40.0%) percent of the Professional Fee (accumulated amount paid under Section 3.02.02 shall be deducted from the total amount). The Professional Fee shall be computed based on the Statement of Probable Project Construction Cost (SPPCC) that shall be part of the documents to be submitted at this particular stage.

3.02.04 Upon the completion of the Contract Document Phase: Upon completion and submission of the documents under Contract Document Phase as stipulated in the Service Agreement, but not more than 15 days after submission of the documents to the Owner, the Owner shall pay the Architect a sum equal to fifty percent (50.0%) of the Professional Fee, or a sum sufficient to increase the total payments on the fee to ninety (90%) percent of the Professional Fee (accumulated amount paid under Section 3.02.03 shall be deducted from the total amount). The Professional Fee shall be computed based on the Statement of Probable Project Construction Cost (SPPCC) that shall be part of the documents to be submitted at this particular stage.

3.02.05 Bidding or Negotiation Phase: Within 15 days after the award to the winning bidder or bidders the payment to the Architect shall be adjusted so that it will amount to a sum equivalent to ninety (90%) percent of the Professional Fee, computed upon the lowest bona fide Bid or Bids or upon the winning Bid Price.

3.02.06 Construction Phase: The remaining of the ten (10%) percent of the Professional Fee is broken down as follows:
a) Five (5%) percent for Architect's Liability under the Civil Code, and
b) Five (5%) percent for the Periodic Construction Supervision (PCS)

Progress Billing can be done on the remaining ten percent (10%) of the Architect’s Fee based on the original Statement of Probable Project Construction Cost (SPPCC).

Upon completion of the work (when Certificate of Completion is issued to Contractor), the balance of the Architect shall be paid computed on the Final Project Construction Cost (FPCC).

6.4.7 The Owner can make partial payments during each of the various stages of the Architect’s work, upon request of the Architect, provided that such payments are within the framework of the manner of payments outlined above.

ARTICLE 4. THE OWNER’S RESPONSIBILITIES

4.01 Provide full information as to his requirements for the Project.
4.02 When necessary, designate a representative authorized to act on his behalf.
4.03 Promptly examine and render decisions pertaining to documents submitted by the Architect to avoid unreasonable delay in the progress of the Architect’s work. The Owner should issue orders to the General Contractor only through the Architect.
4.04 Furnish or direct the Architect to obtain at his expense, a certified survey of the site, giving, as may be required, topographical and/or relocation surveys covering grades and lines of streets, alleys, easements, encroachments and related information, boundaries, with dimensions and complete data pertaining to existing buildings, structures, trees, plants, water bodies, wells, excavations / pits, etc. and other improvements and full information as to the available utility / service lines both public and private; zoning compliances, clearances, deed/s of restrictions, encumbrances and annotations to titles, association guidelines and standards, and soil investigations / tests, borings and test pits necessary for determining soil and sub-soil conditions.
4.05 Promptly pay for architectural and all other engineering and allied services required for the project.
4.06 Pay for the design and consulting services on acoustic, communication, electronic, and other specialty systems which may be required for the project.
4.07 Arrange and pay for such legal, auditing, insurance, counseling and other services as may be required for the project.
4.08 Pay for all reimbursable expenses incurred in the project as called for in Section 7: “Other Conditions on Services” and all taxes including VAT (but not including income tax) that the government may impose on the Architect as a result of the services rendered by the Architect on the project, whether the services were performed as a natural person i.e. an individual practitioner or as a juridical entity i.e. as a sole proprietorship, partnership or corporation.
4.09 If the Owner observes or otherwise becomes aware of anything that may impair the successful implementation of the project, he shall give prompt written notice to the Architect.


ARTICLE. 5. PROJECT CONSTRUCTION COST

Project Construction Cost (PCC) as herein referred to, means the cost of the completed building to the Owner, including the structure, plumbing/sanitary and electrical fixtures, mechanical equipment, elevators, escalators, air-conditioning system, fire protection system, alarm and clock system, communications and electronic system, elements attached to the building and all items indicated in the plans, designs, drawings and specifications prepared by the Architect and his consultants. The construction cost of other items planned and designed by the Architect, such as architectural interiors (AI) and site development plan elements and other items of similar nature, additionally planned / designed by the Architect are also part of the PCC.

The cost of materials used and the labor for their installation are part of the PCC. If these items are furnished by the Owner below its market cost, the cost of the material and labor shall nonetheless be computed on the basis of the current (and fair market value) costs.

The PCC does not include any of the fees for the Architect, the Engineer, the Specialist Consultants or the salaries of the construction inspectors.

ARTICLE 6.   BASIC FEE AND BASIC RATE

The “Basic Fee” and “Basic Rate” refers to the compensation to the Architect on account of his delivery of the Regular or Basic Services referred to in Article 2. Where the Architect has to render more than the regular or basic services, it shall be the subject of a special additional charge commensurate with the special services required. Such special charge shall be in additional to the basic fee provided herein.

ARTICLE 7. OTHER EXPENSES CHARGEABLE TO THE OWNER

7.01Government Taxes on Service: The Architect’s Fee is a net amount. Any tax (exclusive of income tax) that the national and/or local government/s may impose on the Architect as a consequence of the services performed for the project shall be paid by the Owner.

7.02 Different Periods of Construction:   If portions of the building/s are erected at different periods of time, thus increasing the construction period and Architect’s burden of services, charges pertaining to services rendered during the Construction Phase shall be adjusted proportionately. When the suspension of construction exceeds a period of six (6) months, the fee for the remaining works shall be doubled.

7.03 Services of Specialist Consultants: If the Owner requires the services of specialist consultants, they shall be engaged with the consent of the Architect. The cost of their services shall be paid for separately by the Owner and shall not be deducted from the Architect’s fee.

7.04 Other Professional Services: that the Architect’s fee includes normal structural, electrical, electronics, plumbing, sanitary and mechanical engineering services. Services for survey, soil exploration and laboratory test are on the account of the Owner as stipulated in Article 4.04. Other services that may be needed in order to complete the project such as services of acoustic and illumination engineers / specialists, mural painters, sculptors, and other service providers are to be recommended by the Architect for the Owner’s approval. Costs for these services are to be paid for separately by the Owner and shall be subject to a coordination fee payable to the Architect.

7.05 Separate Services: Should the Owner require the Architect to design movable or fixed pieces of cabinets and other architectural interior (AI) elements, site development plan (SDP) components, urban design elements, and other items of similar nature, the Owner shall pay the Architect in addition to the Architect’s fee. The fee shall be based on an agreed method of compensation.

7.06 Miniature Models: Should a scale model, 3D models and/or walk-thru presentation of the architect’s design be necessary for exhibition and display purposes, they are to be recommended by the Architect for the Owner’s approval. Costs for these services are to be paid for separately by the Owner and shall be subject to a coordination fee payable to the Architect.

7.07 Per Diems and Traveling expenses: A per diem of not less than __________ Pesos (P 0,000.00) plus traveling and living expenses shall be chargeable to the Owner whenever the Architect or his duly authorized representative is required to perform services at a locality beyond 50.0 kilometers (air, straight line or radial distance) from his established office as it appears in the Architect’s letterhead.

7.08 Extra Sets of Contract Documents: The Architect is to furnish the Owner  seven (7) sets of Drawings, Specification and other Contract Documents. Cost for printing or reproduction of extra sets of Contract Documents when required by the Owner or his representative is to be paid by the Owner at a cost equivalent to ______________ Pesos (P00,000.00) per set.

7.09 Changes Ordered by Owner: If the Architect renders additional professional services due to changes ordered by the Owner after approval of the Architect’s outputs, the Owner shall pay the Architect for extra time, resources/ drafting, or other office expenses.

7.10 Work Suspended or Abandoned: If the work of the Architect is abandoned or suspended in whole or in part, the Owner shall pay the Architect for the services rendered corresponding to the amount due at the stage of suspension or abandonment of the work.

The primary service of the Architect is the preparation of architectural plans/designs, specifications and other building construction documents. These are sets of detailed instructions that shall serve as the basis for the General Contractor to implement the project. Once the Architect has prepared all these documents, the Architect has completed the Detailed Design and Contract Documents Phase of his services, which is equivalent to Ninety percent (90%) of his work.

When the Owner therefore fails to implement the plans and documents for construction as prepared by the Architect, the Architect is entitled to receive as compensation the sum corresponding to ninety percent (90%) of the Architect’s fee

ARTICLE 8. FULL-TIME SUPERVISION

Upon recommendation of the Architect and with the approval of the Owner, full-time construction supervisors as will be deemed necessary shall be engaged and paid by the Owner. If no Project / Construction Manager is present, the full-time construction supervisor shall be under the technical control and supervision of the Architect and shall make periodic reports to the Owner and to the Architect regarding the progress and quality of the work done.

ARTICLE 9. ESTIMATE

Any SPPCC or any Cost Estimate submitted by the Architect can attain only a certain degree of accuracy. As the Architect has no control over the cost of labor and materials, or the many factors that go into competitive bidding, he does not assume any professional responsibility for such cost estimates, unless glaring errors or discrepancies are clearly evident.

ARTICLE 10. COST RECORDS

During the progress of work, the Owner shall furnish the Architect a copy of the records of expenses being incurred on the construction. Upon completion of the project, the Owner shall furnish the Architect a copy of the summary of all cost of labor, services, materials, equipment, fixtures and all items used at and for the completion of the construction.


ARTICLE 11.  DESIGN AND PLACEMENT OF SIGN

All signboards of the General Contractor, sub-contractors, jobbers and dealers that shall be placed at the project site during the progress of construction shall be approved by the Architect as to size, design and contents. After the completion of the project, the Owner or his building lessee shall consult the Architect for the design, size of all signboards, letterings, directories and display boards that will be placed on the exterior or public areas attached to the building project in order to safeguard the Owner’s interest. Nothing should be installed inside or outside of the building that would compromise its safety and aesthetics.

ARTICLE 11. OWNERSHIP OF DOCUMENTS

All designs, drawings, models, specifications and other contract documents and copies thereof, prepared, duly signed, stamped and sealed and furnished as instruments of service, are the intellectual property and documents of the Architect, whether the work for which they were made is executed or not, and are not to be reproduced or used on other work except with a written agreement with the Architect (Sec. 33 of R.A. No. 9266).

ARTICLE 12. SUCCESSORS AND ASSIGNS

The Owner and the Architect each binds himself, his partners, successors, legal representative and assign to the other party to this Agreement, and to the partners, successors, legal representative and assigns of such other party in respect of all covenant to this Agreement. Except, as above, neither the Owner nor the Architect shall assign, sublet or transfer his interest in this Agreement without the written consent of the other.

ARTICLE 13. ARBITRATION

All questions in dispute under this Agreement shall be submitted in accordance with the provisions of the Philippine Law on Arbitration and provided for in Art. 2042 of the New Civil Code of the Philippines and the provision of the Republic Ac. No. 876, (but all litigations shall be confined under the jurisdiction of city/municipality and both parties agree not to adjudicate in any other areas for that matter.)

The Parties in dispute under this Agreement hereby agree to full performance of the covenants contained herein.


IN WITNESS WHEREOF, the parties to this Agreement have on the day and year first above given, hereunto set their hands at the bottom of this page and on the left-hand margin of all the other pages of this Agreement.

By:

NAME OF OWNER/CLIENT NAME OF ARCHITECT
OWNER                          ARCHITECT

SIGNED IN THE PRESENCE OF:


_________________________________                           ______________________________


ACKNOWLEDGEMENT


Republic of the Philippines)
City/Municipality of _______________ ) S.S.

Before me, a Notary Public in ______________ personally appeared Mr. _______________, with Residence Certificate No. _____________ issued on _______________at ______________ and Architect _______________ with Residence Certificate No. _____________ issued on ____________ at ______________, both known to me and to me known to be the same persons who execute the foregoing instrument and acknowledged to me that the same is their free act and deed.

In witness whereof, I have hereunto set my hand and affixed my Notarial Seal this __ day ______________ in the City of ___________, Philippines.


  ________________________
                                                                                        NOTARY PUBLIC

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