4.1 Introduction

The discussion in Chapter 1 included a definition and description of “the people involved in a construction project.” This chapter will focus on the evolution and development of the design for a project, and the contract and bid documents that are used by the architect-engineer to communicate the design. As those topics are developed, the roles of some of the people involved—owner, architect-engineer, construction manager, prime contractor, subcontractor, and vendor—will be further discussed in the context of the evolution of the design of a construction project and in terms of the development and use of the contract and bid documents for the project.

4.2 The Architect-Engineer

As was noted in Chapter 1, construction projects are designed by licensed professional designers, architects, and/or engineers. The nature of the project and the preference of the owner determine the division of responsibilities between these two design professionals. As a general rule, building projects are designed by architects or have an architect as the primary designer, and civil, structural, electrical, and mechanical engineering services are provided to the architect by consulting engineers as needed.

Highways, bridges, and heavy construction projects, as well as utility and industrial projects, are typically designed with an engineer as the primary designer, and architectural services are included as may be needed. Such projects are typically referred to as engineered projects or engineered construction.

Additionally, there are a number of firms that designate themselves as architect-engineers that perform planning and design work in both classifications of construction work. In this text, the term architect-engineer is used to designate the organization, person, firm, or team that performs the project design, whether it be architectural, engineering, or a combination of both, in composition.

The architect-engineer can occupy a variety of positions contractually relative to the owner and contractor on a project. Typical among these are the following.

4.2.1 Owner-Client

In the traditional project delivery method, the architect-engineer is a private professional design firm that enters a contract with the owner to perform professional design services, as depicted in Figure 4.1.

Most often, the construction is performed by a single prime contractor or by a number of separate prime contractors who also have a contract with the owner. In this project delivery method, there is no privity of contract between the prime contractor and the architect-engineer.

4.3 Designers' Professional Associations

Several associations of designers of construction projects provide a variety of very valuable services for architect-engineer professionals. These associations provide ethical, professional, and business guidance to the individual architect-engineer. Among these professional organizations are the American Institute of Architects (AIA), National Society of Professional Engineers (NSPE), Construction Management Association of America (CMAA), and the American Council of Engineering Companies (ACEC). These professional associations serve in a number of ways to promote and protect the image and reputation of the design profession and to assist their members in achieving higher professional, ethical, business, and economic standards. Additionally, these professional associations produce and publish a variety of “standard form documents” that are very widely utilized in professional practice.

4.4 Selection of the Architect-Engineer

When the owner has in-house design capability, there is no need for a selection process to choose an architect-engineer to design a project for the owner. Otherwise, and for most construction projects, some form of selection process must be followed. Four options that the owner may exercise when selecting a design firm are:

1. The owner seeking out a firm, or a number of firms, and negotiating a contract with the firm of choice.
2. A design competition wherein interested firms present designs and qualifications to the owner, who then selects a designer with whom he will enter a contract.
3. Call for submissions from interested designers with selection based on professional qualifications alone.
4. Call for submissions, which include designation of fees that become a part of the evaluation criteria.
5. Call for bids for professional services and selection on the basis of price alone.

Traditionally, professional societies of architects and engineers have opposed competitive bidding and price competition as a basis for selecting firms to perform professional design services. A number of professional associations have included in their codes of ethics prohibitions against such competitive bidding by their members. These organizations advocate that design professionals should be selected by the owner, based on their qualifications and competence, with the professional fee to be determined through negotiation. Objection to competitive bidding for planning and design services is voiced on the grounds that it is not in the best interest of the client or the public.

However, in 1978, the U.S. Supreme Court ruled that the National Society of Professional Engineers' ethical ban on competitive bidding for engineering services was not permissible under the Sherman Antitrust Act. As a result of this decision, the professional societies for designers, to which almost all designers belong, may not prohibit competitive bidding procedures if those in practice wish to engage in such methods. Consequently, it is not now considered unethical to submit or to invite such bids. Professional societies, however, may encourage owners to continue using the traditional selection and fee-setting procedures. Professional designers are not required to submit bids, and owners may, if they wish, shun competitive procedures in their procurement of professional design services.

Most agencies of the federal government are prohibited from using competitive bidding in the procurement of design services by the Brooks Act (1972). This act mandates the negotiation of design contracts at fair and reasonable prices on the basis of demonstrated competence and qualifications for the type of professional service required. Many states have passed legislation with provisions similar to those in the Brooks Act, that set forth professional selection and negotiation procedures for state-financed projects.

Nevertheless, recent years have witnessed a pronounced shift away from the traditional selection of design professionals exclusively on the basis of qualifications. Following the 1978 Supreme Court decision on competitive bidding by design professionals, there has been a substantial movement by public owners, other than the federal and some state governments, toward the use of price as one of the criteria to be utilized in the selection of architect-engineer firms. The procurement codes of many state and local governments now make the design fee an integral and important component of the selection process. Certain public agencies presently issue fee schedules that apply to their selection of design professionals. In the private sector, the amount of the designer's professional fee usually plays an important role in the procedure for the owner's selection of a designer.

Additionally, there are now requirements that certain designated construction design contracts be set aside for small businesses. Such “set-aside projects” frequently require a specified maximum estimated professional fee or a specified maximum estimated project cost. Small design businesses are identified by the U.S. Small Business Administration as those with annual gross billings of less than a specified maximum average value.

4.5 Services Provided by the Architect-Engineer

The scope of services to be provided by the architect-engineer is subject to considerable variation, depending on the needs and wishes of the owner, and as formalized in the owner-designer contract. Basic to such services, however, are the following:

• Analyzing and ascertaining the needs of the owner.
• Developing a design that will meet the needs of the owner within the owner's budget.
• Preparing the contract and bid documents for the project.
• Assisting the owner in the selection of a contractor.
• Usually, representing the interests of the owner during the construction process.
• Sometimes the architect-engineer firm is also called upon in its contract with the owner to assist the owner with warranty matters following the conclusion of the construction contract.

The function of analyzing the needs of the owner is usually referred to as programming. The architect-engineer assists the owner in the development of a complete and detailed itemization of the owner's needs and wishes. The design produced by the architect-engineer will then address those items that have been listed in the program.

The design produced by the architect-engineer will need to be constructed within the budget the owner has established. In this regard, an early action in the initiation of a proposed construction project is the architect-owner's assisting the owner with the establishment of his budget, as well as the formulation of an estimate of the probable final cost of the project. Such conceptual and feasibility cost estimates (discussed more fully in Chapter 5) are standard procedure for most construction projects and provide the owner with invaluable information concerning necessary project financing. A conceptual cost estimate is the usual starting point for a construction project and is often made using the standards manual issued by the American Society of Professional Estimators. In this ease, the estimating guidelines are based on the standardized system developed by the Construction Specifications Institute (CSI) and called “Construction Specifications Institute MasterFormat 2014,” as shown in Appendix C of this text.

Additionally, the architect-engineer firm may utilize other construction cost summaries such as those produced by the RSMeans Company, the Frank Walker Company, or others. In addition, architect-engineers sometimes engage the services of contractors on a paid consulting basis to provide conceptual and preliminary estimates for use by the owner and the design team as the design is produced.

Whether the project delivery method is competitive bid or negotiated, the architect-engineer's contract with the owner will typically include a requirement that he assist the owner in receiving contractors' proposals, analyzing the proposals and other submittal data, evaluating contractors' credentials and references, and selecting the contractor.

The scope of services provided to the owner by the architect-engineer during construction of the project depends on the needs and preferences of the owner. While the responsibility of the architect-engineer to the owner may cease when the contract documents are finalized and delivered, the owner may require full construction-phase services, including project inspection or observation during construction, the checking of shop drawings, the approval of periodic payments to the contractor, the issuance of a certificate of completion, the processing of change orders, and project closeout. Additionally, owners frequently include provisions in the designer's contract whereby the architect-engineer will assist the owner with administration of warranty issues during the contractor's warranty period for the project.

Although the architect-engineer is not usually a party to the construction contract between the owner and contractor, the contract between the owner and the architect-engineer often conveys certain powers to the architect-engineer such as the authority to act on behalf of the owner, to decide contract interpretation questions, judge performance, condemn defective work, and stop field operations under certain circumstances.

A standard form of design contract between the architect and owner, published by the American Institute of Architects, AIA Document B101–2007 “Standard Form of Agreement between Owner and Architect,” which is widely used for building construction, is reproduced in Appendix B. It should be noted that this and other standard forms and documents reproduced in this text are for illustrative purposes only. Because AIA documents are revised from time to time, users should obtain from the AIA the current editions of the documents reproduced herein.

4.6 Fee for Design Services

When an architect-engineer, acting as a private practitioner, performs a design service for a client, the professional fee may be determined in a number of different ways. The most commonly used are the following:

1. Percentage of construction cost.
2. Multiple of salary cost.
3. Multiple of salary cost plus nonsalary expense.
4. Fixed lump-sum fee.
5. Total expense plus professional fee.
6. Hourly or per diem charge plus expenses.

The basic elements of the agreement as previously described in the clauses, are typically supplemented with additional language relating to compensation for the architect-engineer's expenses such as travel, document reproduction, and so on.

Fees for the design professional on publicly financed projects are often subject to statutory or administrative conditions and limitations. There are instances where the design contract between the owner and architect-engineer provides that payment of the fee is contingent in some way on the project cost being within the budget established by the owner. For example, such contracts may provide that the architect-engineer shall not be entitled to any increase in fee when project redesign is required to keep construction costs within an agreed-upon budget amount. It is common for design contracts to provide that the architect-engineer's fee be paid in installments, as designated phases of the designer's services are completed. It should be noted that contracts between the owner and the architect-engineer in private construction projects often contain provisions similar to these as well.

4.7 Responsibility to the Owner

Although the owner and architect-engineer are usually joined together by contract, their exact relationship depends on the duties being performed by the architect-engineer as defined in the contract. In the preparation of bid documents and contract documents, the architect-engineer firm functions primarily as an independent contractor; however, during construction of the project, its role is that of being an agent of the owner, acting to ensure that the contractor fulfills all of the requirements set forth in the contract documents. Throughout, the architect-engineer has a fiduciary obligation to its client requiring fairness, trust, and loyalty to the owner. Additionally, the design professional must avoid any conflict of interest that could work to the disadvantage of the owner.

The common-law standard of care applicable to architect-engineers is the same as that for other licensed professionals such as doctors and lawyers. The services of experts are sought by the public because of the special skills which they possess. These professionals have a duty to exercise ordinary skill and competence in carrying out their function, and a failure to discharge this duty will subject them to liability for negligence.

As a professional, the architect-engineer is required to exercise care and diligence in carrying out its responsibilities. Learning, skill, and experience are expected to the degree customarily regarded as being necessary and sufficient for the usual practice of that profession. By the contract of employment, the architect-engineer implies that it possesses the ordinary skill and ability for a person acting in this capacity, and that it will carry out the design with promptness and a reasonable exactness of performance.

The designer is responsible for the adequacy of the materials, components, and systems that are selected and specified. The architect-engineer also bears the responsibility for preparing design documents that are in conformance with applicable building codes, setback requirements, zoning regulations, and environmental regulations. It is not expected that the architect-engineer produce a perfect design, or even satisfactory end results. However, the law expects the design professional to carry out the tasks it has undertaken with reasonable standards of care, skill, and performance. If the owner suffers loss or injury because this standard is not met, the architect-engineer is liable for damage or injury that may result.

Architect-engineer liability to the owner may arise through breach of contract or through tort responsibility. More specifically, the designer can be held liable to its client for violation of a specific contract provision, from an express or implied warranty in the design contract, or from negligence in the performance of the architect-engineer's duties under the contract. If the design professional is found to have given an express or implied warranty regarding the sufficiency of the design, or indicating that the structure would be reasonably suitable for the purpose intended, then the architect-engineer is strictly liable for damages caused by a breach of the warranty, and it is not necessary that the owner prove any specific negligence. Although legal interpretations vary somewhat, most jurisdictions hold that there is no implied warranty by design professionals that their plans and specifications are adequate for a specific purpose, except as previously noted. According to most courts, an architect-engineer warrants its work only to the extent that it has used the customary skill of the profession.

Although the architect-engineer firm can be held responsible for lack of care, diligence, or skill, it is not normally considered to be negligent because of errors in judgment. However, there is a definite trend in the courts toward expecting a greater degree of perfection and foresight on the part of architect-engineers and holding these parties responsible for their negligence. In addition, if the architect-engineer represents itself to be a specialist in a certain type of work, it will likely be held to a greater degree of competence and care than would a general practitioner.

If the architect-engineer selects and employs consultants such as electrical engineers, mechanical engineers, acoustical engineers, or landscape architects to design or advise concerning specialized portions of the project, as he almost always does, the architect-engineer remains responsible to the owner for the overall adequacy of the completed design. In this regard, the design professional has a nondelegable duty to the owner and promises by implication that all services will be properly performed. If a consultant's work should prove to be faulty, the architect-engineer is liable to the owner for any resulting damages. The consultant is, in turn, accountable to the architect-engineer for whom the special work was done.

If the architect-engineer's contract with the owner includes provision for inspecting or observing the work of the contractor during construction, it has the duty to ensure that the contractor materially complies with the drawings and specifications and fulfills the requirements of the contract documents. It has the responsibility to see that the owner receives substantially the structure called for by the construction contract.

Design professionals sometimes include exculpatory clauses, which are also known as “hold harmless” clauses, in their design contracts in an attempt to limit their professional liability. Some of these clauses provide that the architect-engineer will not be liable to the owner for damages resulting from negligence of the designer. Other clauses limit the potential liability of the architect-engineer to a specific amount. However, such agreements generally apply only to parties who sign them and cannot limit the architect-engineer's liability to third parties.

Additionally, with regard to exculpatory language in design contracts, certain contractual exemptions from liability have been declared invalid by state statutes, and the general enforceability of such contract clauses is uncertain at best. Courts favor strict interpretation of such exculpatory clauses and seek to avoid contract provisions that excuse parties from their own fault or negligence.

A relatively new approach called a contingency reserve provides that the owner agrees to establish a fund of some specific percentage (perhaps 5 percent) of the construction cost of the project. This reserve is to be used by the owner as necessary to pay the contractor for expenses arising from minor design errors or omissions. The owner agrees not to bring any action against the architect-engineer for additional construction costs within the limits of the contingency reserve, even though they may be the fault of the architect-engineer.

4.8 Liability to Third Persons

Legislative law now generally recognizes that an architect-engineer can be held liable to a third party if bodily injury or property damage is caused to that party by reason of negligence or failure in duty of the designer. Common laws have long held architect-engineers to a similar standard. The law of negligence requires a professional to exercise reasonable care to protect third parties during the performance of the professional's work. In addition, the architect-engineer may in some instances be held liable to third parties for economic loss suffered as a result of its negligence. In this context, third party refers to any party who does not have privity to the design contract between the architect-engineer and the owner.

Third-party liability can arise from a project either during its construction or after its acceptance and occupancy by the owner. Under this concept of liability, architect-engineers now find themselves subject to damage claims by contractors, subcontractors, construction workers, sureties, suppliers, lenders, and outsiders lawfully on the project premises, where the negligent performance of duty by the architect-engineer allegedly caused or contributed to harm or injury.

Recent years have seen the design professional increasingly held liable to general contractors and subcontractors for economic loss caused by the architect-engineer's negligence. Architect-engineers have been held liable for a variety of injuries suffered by workers during construction and by members of the general public after project completion. There have been several cases in which an architect-engineer firm, being responsible in its contract with the owner for job inspection, has been judged responsible for the safety of the work and has been made liable for damages when it failed to take corrective measures, if it knew or should have known of a dangerous job condition. Negligence suits stemming from injuries suffered on completed projects have been filed by parties whose injuries were caused by alleged improper or inadequate design. An architect-engineer's continuing liability for completed projects is often limited by special statutes of limitations, a subject discussed in the following section.

In any discussion of tort liability arising out of negligence, the matter of strict liability arises. There is an increasing trend in this country toward imposing strict liability, on the basis of implied warranty, for injuries caused to the user or consumer of mass-produced products. Product liability, or strict liability, refers to liability without proof of fault; that is, liability for damages is not based on a demonstration of negligence on the part of the producer of the goods. Under this theory, the person suffering injury or damages can receive compensation if it can be proved the product was defective and this defect caused the injury or other loss. The courts have not yet applied product liability to architect-engineers or construction managers, although strict liability has been applied to the manufacturers of prefabricated buildings and to builder-vendors who produced and sold homes that were shown to be defective. These findings were based on implied warranties of workmanship and habitability.

4.9 Statutes of Limitations

Most states now have special statutes of limitations that apply to the accountability for damages that arise out of a defective and unsafe condition created as the result of an improvement to real property. These statutes apply to architect-engineers and construction contractors and establish a time beyond which these parties are no longer liable for damages arising out of completed construction projects. Such statutes provide that the time during which the architect-engineer and contractor remain liable begins with the substantial completion of the work or acceptance of the work by the owner. These statutory periods vary from 4 to 20 years in the various states, with the average being about 7 years.

In those states without such statutes, the architect-engineer and contractor must rely on the states' general statutes of limitations. The time period within which a given action must be brought under these statutes varies. However, a typical statute provides for a three-year period for torts (negligence) and a six-year period for breach of contract. A serious question concerning these general statutes of limitations arises with regard to when the statutory time begins. The usual provision for negligence suits against architect-engineers and contractors is that time starts when the cause of action accrues. The right of the owner to sue for breach of contract ordinarily begins when the work is accepted. However, there can be exceptions when the construction defect is concealed. Such defects are commonly referred to as concealed defects or latent defects.

The result of these conditions is that in those states without special statutes of limitations, the architect-engineer and contractor are indefinitely vulnerable to suits charging negligence or breach of contract. In this regard, it must be noted that some of these special statutes of limitations have been declared unconstitutional in recent years.

In general, it can be said that architect-engineers must be aware of the liability that they assume in the performance of their design work. As a matter of fact, most architect-engineer firms carry professional liability insurance, which is commonly referred to as errors and omissions insurance to assist them in managing this risk.

4.10 Contractor Input into Design

Although construction contracting firms do not typically think of themselves as participants in the design process, increasingly the experience and expertise of constructors are being sought for use by owners and designers. It has repeatedly been shown that construction contractors are a valuable addition to the design team.

In the traditional and still predominant linear construction process, there is usually no input from the contractor into the design process. There are occasional instances where the owner or architect-engineer obtains the consultation services of a contractor during the planning and design phases, but this is much more the exception than the rule. However, extensive contractor input into design is a normal part of design-construct, construction management, and design-manage contracts, where the team concept prevails.

Where the input of experienced construction people into the planning and design of the project is a part of the procedure, the contractor typically enters the process at an early date. The constructor does not perform the design but provides continuing advice concerning general site planning, local work practices, labor availability and costs, material availability, delivery times, and alternative work methods and procedures. The contractor prepares cost estimates and construction and procurement schedules and participates in the value-engineering program. The contractor's knowledge of prices and the availability of materials and services is an invaluable source of information to those making design decisions. As one who is familiar with performance, maintenance, and installation costs, the contractor can help assess life-cycle costs and benefits. Additionally, as one who is familiar with construction procedures and details, the contractor can provide input regarding constructability, and/or the most effective use of various materials, methods, and details to best advantage. Under the right circumstances, contractor input into the design process can result in substantial benefits of all kinds to the owner.

4.11 Project Description—Communicating the Design

The nature and extent of the construction to be performed, the materials to be provided, and the quality of workmanship required for the project are described by the drawings and specifications. Complementing each other very closely, the drawings and specifications present a complete description of the project and the work to be done. The drawings portray pictorially the extent and arrangement of all of the components of the structure. The specifications describe in writing the quality of the materials and the standards of workmanship required. These documents serve four important functions. First, they are the communication tools with which the design of the project is articulated to the owner, to the contractor, and to all other parties associated with the project. Second, they define the entire project and all that is to be built, and thereby serve as a basis for competitive bidding or contract negotiation. Thus, they become the basis for formation of the construction contract. Third, they serve as contract administration documents during the construction phase, describing the work to be accomplished and defining the rights and duties of the participants. Fourth, they are component elements of the contract documents for the project (as discussed in the paragraphs that follow), that define and describe the materials to be used (concrete, brick, steel, wood, gypsum products, etc.) in terms of comprehensive reference standards that have been developed, which define their key properties. The drawings and specifications will be further discussed in sections to follow, in the context of being components of the complete set of contract documents for a project.

4.12 Announcing the Project to Contractors

When the architect-engineer has completed the design and the owner has approved, the project will be announced to construction contractors, meaning that the bid documents and contract documents (to be more fully discussed in sections that follow) will be made available to contractors, and contractors will be invited to prepare and submit proposals for negotiation or competitive bidding. Generally speaking, there are two methods by which the project may be announced to contractors: advertisement for bids and an invitation to bid.

4.12.1 Advertisement for Bids

The advertisement for bids serves as public notice to all contractors that those who are interested and can qualify are being sought to submit proposals for the construction of the project. This method of making contractors aware of the project may be used at the election of the owner on private projects. On public projects, statutory requirements typically indicate that this method must be employed.

Advertisements for bid are typically placed in newspapers, magazines, and in design and construction professional journals. They are listed with contractor news services such as the Dodge Reports, and are furnished to contractor professional associations such as the Associated General Contractors (AGC), Associated Builders and Contractors (ABC), and others. The intent is to place the advertisements for bids wherever the owner and architect-engineer believe contractors may see them and to attain broad distribution so that any contractors who are interested can learn of the project and determine whether they wish to prepare and submit a proposal.

The advertisement for bids typically is included in the bid documents that the architect-engineer makes available to the contractors. The bid documents and the other elements that comprise the set of bid documents are further discussed in the sections that follow.

The advertisement for bids may also be referred to as a notice to bidders or as public notice. Additionally, in a semantic twist, the advertisement for bids may also sometimes be referred to as an invitation to bid. Even when this term is used, this method of making contractors aware of the project is distinguished from the invitation to bid, as it will be discussed in a following section, by the fact that it is public notice to any and all interested contractors.

The advertisement for bids usually contains basic information regarding the name of the owner and architect-engineer, the location of the project, approximate size of the project, and a general description of the scope of work.

Also included is information regarding the procedure for contractors' obtaining the bid documents and contract documents, and reference to deposits that may be required, along with a notation indicating whether deposits are refundable. The expected start date for the project, along with its duration, which is the amount of time that has been allocated for the contractor's completion of all contract requirements, will typically be included. The contract system or project delivery method is described, along with the date, time, and place when proposals are due. Additionally, requirements for bonds, and any prequalifications that the owner and architect-engineer may have established, will be set forth. Instructions and procedures for contractors' obtaining bid documents and contract documents are included. The advertisement will also typically include a statement reserving the owner's right to reject any and all bids.

In addition, the advertisement for bids will usually contain a general description of materials and construction trades to be included in the project. This may take the form of a listing, or this information may be conveyed in terms of divisions of the Construction Specifications Institute (CSI) divisions and/or division numbers that are applicable.

Figure 4.2 illustrates an advertisement for bids for a building construction project, and Figure 4.3 provides an example of an advertisement for bids for an engineered construction project.

4.13 Project Manual

The architect-engineer commonly assembles the bid documents and the contract documents into a book or binding, which is referred to as the project manual. This manual, along with the drawings for the project, is what the contractor will receive when he contacts the architect-engineer and requests a copy of the bid documents and contract documents for the project.

This document is sometimes referred to as the specifications, and contractors frequently say they are requesting the “drawings and specifications” from the designer. When this vernacular is employed, it should be remembered that the specifications are a component of the contract documents that are bound into the project manual. To facilitate the distinction, the term technical specifications is sometimes utilized for the specifications as a component of the contract documents.

4.14 Bid Documents

On a competitive bid project, the architect-engineer will typically produce and publish a set of documents referred to as the bid documents for the project. These documents usually include the advertisement for bids or the invitation to bid, along with the instructions to bidders and the proposal form. These documents are graphically depicted in Figure 4.4.

The advertisement for bids and the invitation to bid were discussed in preceding sections. The sections that follow will discuss the instructions to bidders and the proposal form.

4.15 Instructions to Bidders

For competitive bidding to be a valid procedure, all competitors must bid under exactly the same conditions for an identical package of work. This requires that a set bidding procedure be established and all bidders be required to conform.

Consequently, when competitive proposals are requested, a considerable amount of information concerning the technicalities of the bidding process must be communicated to the contractors involved. This information usually comprises one of the first divisions of the project manual and is designated as instructions to bidders. These instructions review the requirements that the owner or contracting authority has established for the form and content of the bids, and also prescribe certain procedures with which the bidding contractors are required to conform. This document, for example, states conditions pertaining to the form of the bid, where and when it must be delivered, bid security required (see Chapter 5), and information concerning late bids and bids submitted by mail, telegram, or e-mail. A contractor's failure to comply with any stipulation of the instructions to bidders can result in a contractor's bid not being accepted.

Clauses are commonly included that give the owner the right to reject any or all bids, to postpone the date of bid opening, and to exercise many prerogatives in the selection of the successful bidder. An example of instructions to bidders is contained in Appendix A. Standard forms of instructions to bidders are used by many public agencies, many of whom have developed their own form of these documents. The American Institute of Architects has developed a standard form of instructions to bidders. However, standard sets of instructions are designed for general use and do not normally provide all of the information peculiar to a specific project that would be required by prospective bidders. Consequently, supplementary instructions or modifications are customary, or reference is made to certain specific information of interest to bidders already contained elsewhere, such as in the advertisement or invitation to bid. Appendix E is a set of supplementary conditions, which demonstrates this fact.

4.16 Contract Documents

The contract documents for a project are the set of documents that together comprise the contract for construction. These documents are typically prepared by the architect-engineer under the terms of the designer's contract with the owner. Included in the set of contract documents as defined by the architect-engineer are the following: conditions of the contract, drawings, specifications, addenda, alternates, agreement, and modifications to the contract. No one of these comprises the contract for construction; rather, the set of all of these documents defines the contract for construction of the project. Figure 4.4 graphically depicts these documents.

4.17 Summary and Conclusions

While the terms contract and contractor are commonly used in the singular form to describe the basis on which construction projects are performed and the person who performs construction contracts, as has been discussed here, there are a number of documents that together define the construction contract. Additionally, there are a number of people involved in the process of designing and constructing a project, and each has a role, a specific set of duties, and a defined series of responsibilities that are likewise defined by a variety of contracts.

Chapter 4 Review Questions

1. Define a closed specification, and provide a synonym for the term.
2. Define the term alternate, and state two different forms of alternates.
3. Discuss the objection that has been held by professional associations of architects and engineers against the use of competitive bids as the basis of selection of architects-engineers to design construction projects.
4. State the full name of the standard form of the general conditions that is frequently used in building construction contracts.
5. Define the project manual, and list its contents.
6. Describe the basic services provided to an owner by an architect-engineer firm.
7. Define MasterFormat, describe its source, and discuss its use in construction contracting.
8. List and define the four forms of modifications to the contract typically provided for in the conditions of contract for a building construction project.
9. Define the term contingency reserve, and describe its use.
10. Which component of the contract documents actually formalizes the contract and is signed by the owner and by the contractor?
11. Define the term addendum, and contrast an addendum with a change order.
12. Define the term base bid, and discuss its usage.
13. Describe the difficulties that may be caused by the use of an “or–equal” clause in a set of specifications.
14. Discuss the significance of the Brooks Act.
15. State the name of the method that must, by law, be used on most public construction projects to inform contractors that a project has been designed and to let contractors know that the owner and architect-engineer are soliciting bids from contractors.