Tim Nolen, Professional Liability Specialist – SGP Advisors
I’m sure everyone’s seen a stock construction photo like the one above. A few idiots gleefully smiling, holding documents, and pointing at something “important”. Most of us know how ridiculous this sight is, but still, this is the picture many owners have in their head when they see “CA” listed as part of your services. Even worse, they may believe you will be overseeing the day-to-day progress of construction!
What exactly does “CA” mean?
Most professionals believe it stands for “Construction Administration”, but that is a term you should avoid at all costs. Not only does it improperly describe the services you and your firm are providing, but unsophisticated owners may become confused and might even sue you if they have issues with their contractor. The term we recommend instead is “Contract Administration”. This term accurately depicts what you will be doing, ensuring that the actual construction is in conformance with the contract documents.
So why should you fight for Contract Administration services on all your projects?
There are several reasons, with each being as important as the next. Some owners may regard contract administration as costly and unnecessary. If the owner cares little about the quality of a project, he or she may view CA as a needless expense. This is typically seen with clients whose primary interest is a “build-it-fast and get-out-faster” approach. Another type of client, the inexperienced owner, believes a complete set of plans and specifications is a perfect product, much like the directions for assembling a Lego project. If the contractor just follows the “directions”, the owner reasons, the result will be a perfect structure. The fact that these plans may contain unintentional errors or ambiguities (that may result in interpretations in the field) never occurs to this type of owner.
In my years of experience handling claims, I have come to believe that Contract Administration should not be considered an option, offered as an additional service. Contract Administration is just as
integral to the architectural process, as drawings the plans, and should be performed on every project. Ultimately, you are responsible for the health, safety and welfare of the users of your creations, and with that comes liability for what is built. It is your responsibility, as licensed professionals, to observe the construction of your designs and ensure that they are built as documented.
How do I get my Clients to accept Contract Administration Services as part of my fee?
Most Owners have no idea how the architectural process works and if Contract Administration is offered as an “option”, the Owner will most certainly view it as such. Instead, present yourself as a “full service” architecture firm. From helping the Client organize their initial ideas for the project, all the way through to the completion of construction, you want to guide them along the way.
Additionally, propose one fee (flat or percentage based) and include Contract Administration in that fee. Some clients will still ask you if you can eliminate the CA Services from your fee, as a cost saving measure. Tell them it is their prerogative to do so, but first explain the specific work you will perform, and the benefits they will receive from having you involved in the construction process:
- You will hold Weekly/Monthly (depending on the size and scope of the project) to review and keep them informed on the progress of construction.
- Tell the client that CA allows you to confirm the contractor is building the project per the construction documents. The Owner has already paid you a fee to design their building, and it’s in both of your best interest to confirm it is built correctly.
- The fee for CA services gives you the availability to quickly resolve unexpected issues or unforeseen conditions, minimizing potential delays in the construction schedule.
- You will review of the contractor’s payment application, protecting both the client’s interests and confirming that they are only paying for what is appropriate at each stage of the project.
- You will review shop drawings, and submittals to confirm that the client is getting what they paid for.
- You will assist with preparing the punchlist, confirming punched items are corrected, and verify that the Certificate of Occupancy is issued.
As licensed professionals, being involved in the construction process is the best way for you to protect your firm’s legal exposure in terms of liability. On projects where the Contract Administration Phase had been excluded, I consistently see an inability for architects to resolve issues quickly. Small issues become large problems and when the architect is not involved, guess who gets the blame… you!
From a business point of view, you are ultimately working for your clients’ complete satisfaction. If you are absent during construction, it is extremely difficult to manage expectations and keep your clients happy. It is their experience during construction that clients will remember most when others ask for their referral. You must be involved, the success of your firm depends on it!