Client agreements

Clause 6 of the Code applies to agreements for the provision of ‘architectural services’. For the purposes of this clause, the term ‘architectural services’ is taken to mean services relating to the design, planning and construction of buildings or other built environment projects, which are commonly carried out by architects.

For very small engagements or projects (such as providing advice about the viability of a small-scale residential extension), a simple short form agreement that meets the requirements of clause 6 could be used.

The ARBV does not expect architects to comply with the requirements of clause 6 for agreements to provide services that, while drawing upon their expertise and experience as an architect, do not relate to the design and construction of buildings or other built environment projects. Examples of this type of service include providing expert opinion evidence, tutoring or lecturing, presenting at conferences and other events and writing of books and articles. While the ARBV does not interpret clause 6 of the Code as applying to agreements for services of this type, clause 6(4) (which sets out essential terms to govern the relationship between the parties) may nevertheless be helpful to inform the terms of the agreement and promote successful service delivery in the context of these services.

Clause 6(1) of the Code, provides that an architect must not collect a fee for any work undertaken unless a written and signed agreement is in place.

Clause 6(1) of the Code separately provides that an architect must not provide architectural services – including concept designs, sketches or reports – for a client without a written and signed client agreement in place. This applies regardless of whether the work is preliminary in character, and regardless of whether any fee is charged or expected.

Before a client agreement is in place, an architect may present their portfolio of previously completed work, have general discussions about capabilities and fees, or conduct preliminary scoping conversations that do not involve producing any design or other architectural work.

A client agreement that complies with the Code must be signed by both parties before any architectural services are provided. This includes early-stage work such as:

• concept designs
• sketches
• reports

The client agreement may be a standard form or template agreement, but may also be a bespoke agreement that is tailored for a particular project.

If work must commence before a detailed client agreement is in place, a short-form interim agreement that meets all mandatory content requirements for the relevant scope of work could be used until the detailed client agreement is finalised and executed.

Clear evidence that both parties have agreed is necessary – such as, a signed written document. Informal agreements, which are not documented in writing, are not sufficient.

If an architect identifies that a compliant client agreement is not yet in place, they must stop providing services immediately until an agreement is put in place.

Architects must provide the proposed client agreement to the client at least 7 business days before requesting the client’s signature on the agreement to indicate their agreement to the terms of the agreement.

This requirement seeks to ensure that clients have enough time to:

• read and understand the agreement; and
• seek advice about whether the agreement should be entered into, if necessary.

Architects should build this timeframe into project planning.

While the architect cannot require the client to sign the agreement before 7 business days have passed, the client may, if they so wish, enter into the agreement before the expiry of this period. However, the purpose of the 7 business day requirement is to provide clients with sufficient time to read and understand their rights and obligations under the agreement, including potentially seeking professional advice on its terms.

Accordingly, the ARBV recommends providing a draft of the client agreement to the client 7 business days before meeting with the client to go through the terms of the agreement. This will be particularly beneficial if the client has limited experience or no previous experience dealing with an architect or involvement in building projects. If a client wishes to sign the agreement early, records should be kept by the architect to demonstrate that this was done contrary to the 7 business day requirement.

Client agreements cannot apply to work that has already been provided by an architect and architects cannot charge for this work.

Architects must not:

• back-date agreements; or
• attempt to retrospectively cover or charge for services that have already been provided.

If work has commenced without a compliant agreement in place, the work must immediately stop until a compliant agreement is put in place.

Client agreements must include all the mandatory content specified in the Code. They should be easy for the client to understand.

Key agreement terms that often cause issues include:

• Fees: The client agreement must clearly explain how fees are calculated and when they may change.
• Scope of architectural services: The description of the scope of services in the client agreement must be specific enough to avoid uncertainty about services that are covered by the agreement.
• Variations: The client agreement must explain how changes to the services are requested, approved and costed.
• Timeframes: Timeframes for the provision of architectural services should be clearly identified and realistic.

Where exact details are not yet known (for example, costs or timeframes), architects should:

• provide reasonable estimates;
• explain assumptions that underpin the estimates;
• explain when updates will occur to clarify the estimates;
• update clients as soon as it becomes apparent that estimates are no longer accurate.

In many commercial and government engagements, it is the client rather than the architect who provides the agreement for the provision of architectural services. These agreements are typically drafted by lawyers and, particularly for larger and more complex projects, will often include detailed terms that cover and go well beyond the minimum requirements of clause 6(4) of the Code. In these circumstances the architect may have limited or no ability to negotiate the terms.

Clause 6(4) sets out the minimum content that every client agreement must include, regardless of who drafts it. Its purpose is to protect both the client and the architect by ensuring that key rights and obligations are clearly recorded in writing. This is particularly important for clients with limited experience of architectural engagements or building projects, but the requirements apply to all agreements, regardless of project scale or client sophistication.

Where an architect is presented with a client-drafted agreement, they should review it carefully against the mandatory requirements in clause 6(4) before signing. If a required term is absent, the architect should request in writing that it be included, explaining that its inclusion is required by law. This request should be made before the agreement is executed and a copy retained on the project file.

If the client refuses to include the required term, the architect's written request creates an important record. It demonstrates that the architect identified the gap, sought to remedy it, and was prevented from doing so by the client. This is evidence that can be produced to the ARBV if non-compliance with clause 6(4) is ever raised as an issue. While this does not cure the non-compliance, it provides important context and demonstrates the architect's good faith attempt to meet their obligations.

Clause 6(4)(q) of the Code requires architects to include details of their current professional indemnity insurance that provides adequate coverage for the work covered by the agreement in their client agreements.

The professional indemnity insurance details that should be included are:

• the name and ABN, ACN or ARBN of the insurer
• the name of the policy holder
• the policy number
• the date of issue and the expiry date of the policy
• the level of indemnity provided
• the architects insured under the policy.

Architects may wish to annex a copy of their Certificate of Currency that contains the above information to their client agreements.

Architects are expected to use their professional judgement to determine the level of cover that is required for each project. The minimum level of coverage required under the Act ($1.2 million) is for the purpose of holding registration as an architect only. Individual projects may require significantly greater coverage depending on project risk, size, and contractual requirements.

A fee proposal is not the same as a compliant client agreement.

A document will only satisfy the Code if it includes all mandatory requirements for a client agreement that are set out in the Code. Fee proposals are unlikely to contain these details.

Architects must keep clear records showing:

• the client accepted the agreement in writing; and
• any changes to the agreement and to the scope of architectural services were agreed in writing.

When entering into a client agreement, architects must provide the client with:

• the names of all personnel involved in the services;
• their roles; and
• their registration status.

This helps clients understand who is responsible for delivering the work, including the oversight arrangements that are in place. This promotes transparency and manages client expectations and will likely prevent clients from believing that they have been misled or deceived when another member of staff, particularly one who is not an architect but working under supervision, carries out work on their project.

The list of staff members can be incorporated into the client agreement by listing them in the body of the agreement or by listing them in a document annexed to the agreement.

Under the Code, the list of personnel working on a project only needs to be provided at the time the agreement is entered into. In the interests of promoting transparency and good client communication, architects may choose to ask their clients whether they wish to be informed of any future changes to the personnel working on their project and how often they would prefer to be informed of any changes.

If an architect withdraws from providing services after receiving payment for those services, they must provide the client with written reasons.

Under the Code, an architect must withdraw from carrying out work if the architect reasonably believes that this may result in a breach of the Act, Regulations or Code.

The requirement to provide reasons for withdrawal supports transparency and helps reduce disputes.

Keep a complete record of changes and revisions to the client agreement, including:

• changes to scope of services;
• changes to fees; or
• revised timeframes for completion of services.

All changes must follow the variation process set out in the client agreement and be recorded in writing.