📋 AIA Contract Walkthrough
AIA contracts are the most common standard construction contracts. Understanding them helps you protect your rights and avoid costly mistakes.
What are AIA Contracts?
AIA (American Institute of Architects) publishes standard construction contract documents used throughout the industry.
Common AIA contracts:
- A101 - Owner-Contractor Agreement (Stipulated Sum)
- A102 - Owner-Contractor Agreement (Cost Plus)
- A201 - General Conditions
- A401 - Contractor-Subcontractor Agreement
- G702/G703 - Application and Certificate for Payment
Why AIA Contracts Matter
Industry Standard
- Widely used - Most common standard contracts
- Well-tested - Decades of use and interpretation
- Balanced - Generally fair to all parties
- Familiar - Most contractors know them
Key Benefits
- Clarity - Clear terms and conditions
- Protection - Protects all parties
- Dispute resolution - Built-in procedures
- Standardization - Consistent across projects
Key AIA Contract Documents
A101 - Owner-Contractor Agreement (Stipulated Sum)
Used for: Fixed-price contracts
Key sections:
- Contract sum
- Payment terms
- Schedule
- Change orders
- Substantial completion
A102 - Owner-Contractor Agreement (Cost Plus)
Used for: Cost-plus contracts
Key sections:
- Cost definition
- Fee structure
- Guaranteed maximum price (GMP)
- Reimbursable costs
- Fee calculation
A201 - General Conditions
The "rules of the game" - Applies to most AIA projects
Key sections:
- Article 1 - Definitions
- Article 2 - Owner's responsibilities
- Article 3 - Contractor's responsibilities
- Article 4 - Architect's responsibilities
- Article 5 - Subcontractors
- Article 6 - Construction by owner
- Article 7 - Changes in work
- Article 8 - Time
- Article 9 - Payments
- Article 10 - Protection of persons and property
- Article 11 - Insurance and bonds
- Article 12 - Uncovering and correction of work
- Article 13 - Miscellaneous provisions
- Article 14 - Termination or suspension
- Article 15 - Claims and disputes
Critical Contract Clauses
Article 9 - Payments
Progress payments:
- Application - Submit G702/G703 monthly
- Review period - Architect reviews within 7 days
- Payment - Owner pays within 7 days of approval
- Retainage - Typically 10% until substantial completion
Final payment:
- Application - Submit final application
- Lien waivers - Provide final lien waivers
- Payment - Owner pays within 30 days
Key points:
- Timely applications - Submit on time
- Complete applications - Include all required docs
- Follow procedures - Follow contract procedures exactly
- Document everything - Keep records
Article 7 - Changes in Work
Change order process:
- Owner requests change - Written or oral
- Contractor proposes - Price and time
- Architect reviews - Approves or rejects
- Owner approves - Signs change order
- Work performed - After approval
Key points:
- Get approval first - Don't work without approval
- Document requests - Written is best
- Price accurately - Include all costs
- Include time - Request time extension if needed
Article 8 - Time
Schedule:
- Contract time - Specified in contract
- Extensions - For delays beyond contractor's control
- Liquidated damages - If specified
- Substantial completion - When project substantially complete
Key points:
- Track delays - Document all delays
- Request extensions - In writing, timely
- Substantial completion - Know the definition
- Final completion - Punch list completion
Article 11 - Insurance and Bonds
Required insurance:
- General liability - Typically $1M/$2M
- Workers' compensation - As required by law
- Builder's risk - If required
- Professional liability - If required
Required bonds:
- Performance bond - If required
- Payment bond - If required
Key points:
- Maintain coverage - Keep insurance current
- Provide certificates - COIs to owner
- Additional insured - Add owner if required
- Bonding capacity - Ensure adequate capacity
Article 12 - Uncovering and Correction of Work
Uncovering work:
- Owner/architect can require uncovering
- Contractor pays if work defective
- Owner pays if work acceptable
Correction of work:
- Contractor must correct defective work
- At contractor's expense
- Within reasonable time
Key points:
- Quality work - Do it right the first time
- Document inspections - Keep records
- Correct promptly - Fix issues quickly
Article 14 - Termination or Suspension
Owner can terminate:
- For cause - Contractor default
- For convenience - Without cause (pays contractor)
Contractor can terminate:
- For cause - Owner default
- Non-payment - After proper notice
Key points:
- Know your rights - Understand termination clauses
- Follow procedures - Give proper notice
- Document defaults - Keep records
- Get paid - For work performed
Article 15 - Claims and Disputes
Claims process:
- Initial decision - Architect makes initial decision
- Mediation - If parties disagree
- Arbitration - If mediation fails (if required)
- Litigation - If no arbitration clause
Key points:
- Follow procedures - Follow claim procedures exactly
- Timely notice - Give notice within time limits
- Document claims - Support with documentation
- Consider mediation - Often resolves disputes
A401 - Contractor-Subcontractor Agreement
Used for: Contracts with subcontractors
Key sections:
- Scope of work - What sub performs
- Payment terms - When sub gets paid
- Flow-down provisions - Owner contract terms apply
- Retainage - Withheld retention
- Backcharges - When contractor can backcharge
Key points:
- Clear scope - Define scope clearly
- Payment terms - When and how paid
- Flow-down - Owner contract terms apply
- Protect yourself - Include protective clauses
G702/G703 - Application for Payment
G702 - Application:
- Application form
- Amount requested
- Retainage
- Previous payments
- Amount due
G703 - Schedule of Values:
- Breakdown of work
- Completed work
- Stored materials
- Total value
Key points:
- Complete accurately - Fill out completely
- Support with docs - Include required documents
- Submit on time - Meet deadlines
- Track carefully - Keep records
Common Mistakes
| Mistake | Problem | Solution |
|---|---|---|
| Not reading contract | Don't know terms | Read entire contract |
| Missing deadlines | Lose rights | Calendar all deadlines |
| Working without approval | No payment | Get approval first |
| Poor documentation | Can't prove claims | Document everything |
| Ignoring procedures | Claims denied | Follow procedures exactly |
Best Practices
Before Signing
- Read entire contract - Don't skip sections
- Understand terms - Ask questions
- Review modifications - Check for changes
- Get legal review - If significant contract
- Negotiate - If terms unfavorable
During Project
- Follow procedures - Exactly as specified
- Document everything - Keep records
- Meet deadlines - Calendar all deadlines
- Communicate - In writing when important
- Track changes - Document all changes
For Claims
- Give timely notice - Within time limits
- Follow procedures - Exactly as specified
- Document thoroughly - Support with evidence
- Be professional - Maintain relationships
Contract Modifications
AIA contracts can be modified:
- Supplementary conditions - Modify general conditions
- Addenda - Changes before contract signing
- Change orders - Changes after contract signing
Key points:
- Review modifications - Understand changes
- Negotiate - If modifications unfavorable
- Document - Keep all contract documents
- Consistency - Ensure modifications consistent
Related Resources
- Contract Basics - General contract principles
- Change Order Management - Managing changes
- Pay Applications - Payment process
- WIP Reporting - Work in progress
Read Before You Sign
AIA contracts are generally fair, but you still need to understand what you're signing. Read the entire contract, understand the terms, and get legal review for significant contracts.