ENCON'S CONTRACTS CHECKLIST

A Jardine Lloyd Thompson Professional Liability Information Article

ENCON'S CONTRACTS CHECKLIST

Properly written contracts are absolutely essential to protect design professionals. This checklist is not exhaustive but does touch on m any important points. Legal advice is often warranted and strongly recommended.

Be sure the contract is written; a standard form issued by your association is preferable.
Be very careful in modifying the standard forms. Consult your lawyer if you intend to use non- standard contract forms.
Make sure you know the implications of the contract on your insurance coverage.
Be familiar with the duties and responsibilities assigned to you by the contract between the owner and contractor.
Any changes to the services to be performed should be in writing and made on the basis of an amendment or supplement to the original agreement with the client.
The contract realistically and definitively describes the project and relates it to any feasibility study.
The contract realistically defines the consultant's services, particularly field services.
The contract is compatible with the contracts of other parties involved in the project.
There should be no inconsistencies and no doubling up of duties and responsibilities.
The contract should accurately define the consultant's responsibilities for commissioning and start up with realistic targets and an acknowledgement that there are many elements beyond the consultant's control.
The contract should not include express warranties or guarantees that would nullify the consultant's professional liability coverage.
The contract should include no indemnity clauses by which the consultant assumes others' liability. In law consultants are responsible for their errors and omissions and those of their sub-consultants and employees. They should not assume other liabilities through the contract.
The contract should describe the client's requirements and the information and data, which the client will supply to the consultant.
There should be a provision for an equitable adjustment of fees if the owner suspends and later resumes the project. Is there a financial penalty for termination at the owner's convenience?
Is there a non-payment clause? Can you stop work without liability for consequential or other damages?
The contract should distinguish between Basic and Additional services and stipulate adequate remuneration in each case.
The contract should allow you to control substitutions and limit the time you spend evaluating substitution requests to a reasonable amount.
The contract should clearly state the limitations on your ability to predict construction costs.
The agreement should clearly indicate that you are not responsible for how the contractor builds the project or manages safety on the site.
Your responsibility for reviewing submittals should be limited to those required by the Construction Contract.
It should be clear that Record Drawings are based, in large part, on information supplied by others for which you cannot be held responsible.
The contract should cover transfer of your documents, and protect you against the consequences of misuse by others in the present and subsequent projects.

The information contained herein is believed to be accurate, but individual circumstances, local business and insurance practice and the Law can vary extensively and Jardine Lloyd Thompson and its associated and subsidiary companies are not responsible for any errors and omissions or any loss or damage arising from the use of this information. In the event of situations such as are described in this bulletin, the reader should seek legal counsel and specific advice from Jardine Lloyd Thompson or your Insurance Broker.