This autumn, the Royal Institute of British Architects (RIBA) published an updated suite of standard form agreements. We will discuss the key updates, with particular focus on the revised professional indemnity insurance provisions that reflect the insurance market's approach to cover for fire-combustibility matters.
In this article, we will only focus on the updated RIBA Standard Professional Services Contract for Architectural Services (RIBA PSC) 2020, which introduces key changes to the standard appointment terms for Architects.
We will also briefly outline the changes to the RIBA standard form for architectural services that have been made throughout the last decade.
The changes introduced by the RIBA PSC 2020
The RIBA PSC 2020 introduces revisions to the RIBA PSC 2018 so that it, amongst other things, aligns with the new revised RIBA Plan of Work.
A number of the standard clauses have also been updated for clarity and ease of understanding.
Key updates include:
- Professional Indemnity Insurance and Limit of Liability – the Architect is now required to state whether cover is being maintained for cladding or fire-related issues. This update reflects current industry concerns in respect of cladding and firerelated claims following the Grenfell Tower tragedy. As the Architects' limit of liability is determined by the amount of professional indemnity insurance required under the agreement. Accordingly, the Architect's liability for fire-related matters may be limited or even excluded, however, it is likely clients will push back on a complete exclusion.
- Novation – the novation provision now provides that the agreement may be novated to any third party not just the Contractor under the Building Contract.
- Publishing – the Architect no longer needs to obtain written consent from the Client to publish photographs or other information relating to the project (although, as expected, this right is subject to the standard confidentiality clauses).
RIBA Standard Agreement 2010 (2012 revision) and RIBA PSC 2018
A number of revisions have been made to the standard form of agreement for Architects since RIBA first published the RIBA Standard Agreement 2010 and the RIBA Standard Agreement 2010 (2012 revision), (RIBA Standard Agreement 2012).
We are aware that a number of Architects are still using the RIBA Standard Agreement 2012.
The revisions since the introduction of the Standard Agreement 2012 have sought to improve the usability of the agreement to ensure the terms continue to reflect the constantly changing market standards and conditions.
The key changes to the RIBA Standard Agreement 2012 introduced by the RIBA PSC 2018 are, amongst others, set out below.
- Duty of Care
The RIBA PSC 2018 introduced an overarching reasonable skill and care clause. This clause ensures that the Architect's contractual obligations are in accordance with the duty to exercise reasonable skill and care, thus avoiding the situation where absolute obligations are imposed that are inconsistent with typical professional indemnity insurance arrangements. An overarching duty of care clause is particularly important where there may be absolute and/or fitness for purpose obligations in the scope of services.
- Suspension and Termination
The RIBA PSC 2018 introduces rights of termination (in addition to the rights of suspension under the Standard Agreement 2012) to the Architect upon giving at least 7 days' notice, including in respect of, amongst others, nonpayment of the fee by the Client by the Final Date for Payment.
Moreover, the Architect has wider rights of suspension under the RIBA PSC 2018 than under the RIBA Standard Agreement 2012 as it can now suspend or terminate for 'any other reasonable grounds'. This can be a useful tool for Architects where, for example, there is a problem project and/or the job is no longer viable.
Both RIBA and ARB codes of conduct emphasise the importance of having a written record of the appointment before any work commences. The RIBA PSC 2020 seeks to provide a user-friendly set of terms and conditions on which Architects can form agreements with their clients. The RIBA PSC 2020 standard terms aim to maintain a balance between both parties' interests, while also attempting to protect the Architect's interests and limit its liability. The updates to the RIBA PSC 2020 seek to ensure that the RIBA PSC reflects market standards and in particular the recent shifts in trends in professional indemnity insurance cover (and therefore the limit of liability as it is determined by the amount of professional indemnity insurance required), including in relation to fire-related matters since the Grenfell Tower tragedy.
Overall, throughout the years the updates to the RIBA standard form agreement for Architects continues to incorporate positive improvements for Architects in the UK and although it may often be difficult to incorporate the agreement without amendments on commercial projects, the RIBA PSC 2020 serves as a helpful starting point.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.