In this ARE 5.0 Practice Management Exam Prep course you will learn about the topics covered in the ARE 5.0 PcM exam division. A complete and comprehensive curriculum, this course will touch on each of the NCARB objectives for the ARE 5.0 Practice Management Exam.
Instructor Mike Newman will discuss issues related to pre-contract tasks including negotiation, human resource management and consultant development.
When you are done with this course, you will have a thorough understanding of the content covered in the ARE 5.0 Practice Management Exam including business structure, business development, and asset development and protection.
So let's take a look at the architect's responsibilities. The first one that I'm gonna mention here is 2.2. This is one you've probably heard me say five times already. This is essentially the standard of care. So let's read it out. "The architect shall perform its services consistent "with the professional skill and care ordinarily provided "by architects practicing in the same or similar locality, "under the same or similar circumstances." So what's that saying is this is not a contract to say that we're gonna provide the most beautiful building ever. This is not a contract that says this will be the most efficient building ever.
This is not a contract that says any hyperbole at all. What this is saying, the point of the contract, is saying, "Look, we will be competent." We will be competent in the way that any other professional reasonable architect would be competent. And if we make a mistake, that's how we'll be judged. So we'll be judged by if something goes wrong, literally, the question would be asked, if another architect was doing this design, and they made a similar decision, because we know that they are a competent architect, and we're comparing ourselves to them.
Then that similar decision says, well, that's the same decision that we would have made. So, it's a way of comparing competency. It's not a way of saying that an architect needs to be perfect. It's not a way of saying that the project will always go perfectly. It's a way of saying look, we have a confusing set of information at the beginning. It's hard to decide exactly how everything's gonna go. But the architect needs to be competent and know what the code needs and know what the client needs.
And produce something that's a reasonable production, a competent production, that meets all the code requirements and answers the program that the client has given them. It doesn't say anywhere in here that you have to be able to foresee difficulties or bad weather or that the contractor's gonna do bad work or anything like that. There's no way that you could have that built into the contract because it's just unknowable.
So the idea of that standard of care, that's the level of expectation that you are expected, contractually, to meet. Now, you may make other side deals. You may have brochures that express the beautiful work you do, or something like that. That's all well and good. This is the contract, though, this is the level that when litigation comes, the level of the work that you can be held to. And there it is, right there, straight into the contract. The next couple ones here, let's look down at 2.4.
"Except with the owner's knowledge and consent, "the architect shall not engage in any activity "or accept any employment, interest, or contribution "that would reasonably appear to compromise "the architect's professional judgment "with respect to the project." What that's saying is you can't take side money. You can't get a kick-back from the drywall supplier or the siding supplier or from the furniture supplier. That you have to be working for the client, only. Now, there are plenty of situations where that does actually happen, and it works out because, for whatever reason, maybe you've been chosen because you're a part of a group that produces material, like furnishings or something, so it may be actually part of the desire to have you in this project is that you have a financial implication in the rest of the project.
That's fine, as long as it's worked out with the owner and delineated in this contract. But most of the time, that idea, when you put it in the terms of a kick-back, it becomes clear that that's just not a reasonable thing for the architect to be doing.
Because you'd be putting the project and the safety of the public at the whim of your ability to get some kick-back of money. It doesn't make sense, that's not your role. You're there to be a protector of the public, and you're there to answer the needs of the client. You're not there to do these sort of side deals. So, built into the contract that you can't do that. And then, immediately after that, we start getting into a whole question of insurance.
So there's gonna be the expectation of having professional insurance, often referred to as Errors and Omissions, E & O, but then there's other insurance, as well. You have the general liability insurance, which would be just standard insurance that company would have. If somebody shows up for a meeting and trips on the rug in your office, they break their leg and they sue you. Well, that's gonna fall under your general liability, that's not gonna have anything to do with your professional decision-making. So those are two separate insurances, and they're both listed out here. Not every client will require that you have both of these.
But often, you'll have to delineate these for specific clients. Automobile insurance, etc., there's a whole series of these different elements. Worker's compensation, a whole bunch of these different pieces. Some will be required, some won't be. You just cross them out if they're not part of the contract. And then the idea of the additional insured, that's where your insurance is not gonna only cover you, but it's going to cover the client or other people who are involved. So, you build that in to the contract, because it may actually cost you money.
So you have to be very careful about what you're saying yes you're willing to have your insurance do. So you can see, just in that one page, there's a lot of really interesting information. It's really talking about what is the nature of an architect? How do they perform their work? What can they be considered competent? How do you judge competency, and how other people will judge it through insurance, through timing, through the money, all of that. It's all listed right here in this contract.
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From the course:
ARE 5.0 Practice Management Exam Prep
Duration: 11h 28m
Author: Mike Newman