By Jon Orlove, Associate Principal, Solomon Cordwell Buenz
April 25, 2022
The late Anthony Bourdain’s quote can easily apply to working on an overseas architectural project. Particularly if it is your first one. There is a steep learning curve. Risks and rewards. How do you educate yourself? A great resource can be found in AIA Contract Documents’ updated B161 – Agreement Between Client and Consultant for design consulting services where the Project is located outside the United States, which was first published in 2002. AIA documents are typically updated every ten years to reflect changes in the industry. The B161 was not updated in 2012 and the AIA considered retiring it, however it was recognized that architects would benefit from it being revised and reissued, particularly given the continuing trend of firms seeking opportunities for work outside of the United States. Provided below is a brief introduction to the document.
Who is the Target Audience?
Developing a template agreement to work anywhere outside of the United States and on any type of project is a challenging endeavor. Architectural practices, construction methods, language, law, codes, and customs vary considerably from country to country. The earlier 2002 version of the agreement cast a wide net and was organized for the full spectrum of architectural practices.
The revised agreement has been updated for the novice. It is made more accessible to practitioners who do not have prior or extensive experience working overseas and who do not intend to be licensed as an architect in a foreign jurisdiction, which is a time-consuming and expensive proposition. For this reason, the architect is identified as a “Consultant”. Consistent with licensing boards throughout the United States, foreign jurisdictions may limit use of the title “Architect” to those appropriately qualified and licensed. The agreement also assumes that the architect, or Consultant, will provide the majority of their services from the United States. This is to reduce potential foreign tax exposures that can be triggered when performing services in a foreign country. Finally, and for the same reason that the architect is considered a Consultant, the scope of services has been intentionally reduced. It is generally limited to the completion of the Design Development phase as a way of separating the Consultant’s services from the services that will need to be provided by a separate architect of record, to be retained by the client, who is licensed and registered as appropriate to practice architecture in the jurisdiction and is able to be responsible for the project.
Program or Programme, Bid or Tender?
The first hurdle presented itself early on in drafting the agreement. What terminology should be used? Should one conform to the norms of a specific international region, and if so, which one? Or is it better to normalize terminology through use of robust definitions? After much debate it was decided to include the terminology that is commonly used in the United States and consistent of the other AIA contract documents. The rationale for this decision is that the predominant user of this document will likely be an architect based in the United States, and that the terminology should be familiar to that audience.
Major Updates in the 2022 Version
A lot has happened in twenty years – no iPhones in 2002 – so there were plenty of opportunities to improve the B161 agreement. Listed below are some of the important changes.
The body of the agreement includes the scope of the Consultant’s services, instead of the use of exhibits at the end of the agreement. The description of the post-Design Development phase services was revised to account for the fact that the Consultant is not licensed and to limit the amount of work performed outside of the United States.
The 2002 version included a responsibility matrix exhibit to define the Consultant’s, client’s and local architect’s responsibilities. Exhibits such as this can be beneficial, however, it proved difficult to develop one that could satisfy the wide range of variables. Instead, descriptions of the Consultant’s, client’s and local architect’s responsibilities have been augmented within the body of the agreement to eliminate the need for the exhibit.
The Consultant’s obligation to design a project within the client’s budget has been revised to align with other AIA agreements, such as the B101 or B103. In this case however, since the Consultant services are intended to be largely complete after the Design Development phase, their duty of budget compliance only extends through that phase and not through the award of the construction contract.
The agreement assumes that all engineers and consultants will be retained by the client as that party will likely be best suited to identify appropriately experienced individuals and to manage risk related to their involvement.
The subject of claims and disputes was described in greater detail and revised to reflect commonly used methods.
There is a prompt for the Consultant to identify Professional Liability Insurance requirements and the duration for it to be maintained in stipulated, and the Consultant’s liability is limited to a stipulated amount instead of available insurance.
A Word of Caution
Working on a project in a foreign country is challenging and fraught with risk. The B161 agreement helps but does not neutralize all risk. Before taking the plunge, it is recommended to educate yourself and to seek expert legal and financial advice.
In addition to the B161, AIA Contract Documents has created a free guide, B561-2022 – Guide to International Practice and Contracting for U.S. Architects. It provides a wealth of information for the novice – recommended steps one should take prior to entering into an agreement, in depth reviews of each agreement article, and available resources. The guide is a valuable resource on its own, even if one is not able to use the B161 agreement. You can find the B161 agreement and B561 guide at aiacontracts.org, starting May 25, 2022.
And a Word of Encouragement
“The world is a book, and those who do not travel read only one page.” – Saint Augustine
There are so many good reasons for working on a project in another country. Expanding your business opportunities and your professional network; experiencing a different way to practice architecture; and exposure to different cultures, food, and experiences. It places you outside of your comfort zone and it is invigorating professionally and personally. If the opportunity presents itself, take it.
Jonathan Orlove AIA is an architect and Associate Principal at SCB www.scb.com, a diverse multi-disciplinary practice with projects throughout the United States. Previously he was the Director of Project Management at Adrian Smith + Gordon Gill Architecture where he worked on projects all over the world.
AIA Contract Documents has provided this article for general informational purposes only. The information provided is not legal opinion or legal advice and does not create an attorney-client relationship of any kind. This article is also not intended to provide guidance as to how project parties should interpret their specific contracts or resolve contract disputes, as those decisions will need to be made in consultation with legal counsel, insurance counsel, and other professionals, and based upon a multitude of factors.