Terms and Conditions of Service

A. Definitions

A.1 Brief: Statements and materials assembled by the Client with the Building Designer’s assistance to summarise the Client’s initial requirements, to address the Client’s preferences and priorities, and to summarise the impact of context, environment and prevailing legislation at the time of signing this Agreement.

A.2 Construction Cost: The latest professionally prepared estimate for the final cost of constructing all elements of the Project designed or specified by the Building Designer, including:

• Any contingencies for changes in work or design reserve cost allowances
• The cost of any equipment and/or materials provided (as if new) or to be provided by the Client to a contractor for installation during construction of the Project
• Any direct costs carried out by, or on behalf of, the Client
• Provision for contractor’s profit and overheads.
• The Construction Cost shall not include:
• GST
• Design fees
• Cost of the land
• Any loss and/or expense payments paid to a contractor
• Any liquidated damages deducted by the Client
• The costs of resolution of any dispute
• The Client’s legal and in-house expenses.

A.3 Agreement: the agreement between the Client and the Building Designer consisting of Parts 1, 2, 3 and 4 of this document and all attachments listed.

A.4 Building Designer: The person, company or firm identified as the Building Designer in Part 1 of this Agreement.

A.5 Client: The person, company or firm identified as the Client in Part 1 of this Agreement.

A.6 Consultant: A person, company or firm appointed by the Client to perform professional services in connection with the Project.

A.7 Fee Proposal: The fee structure set out in Part 2 of this Agreement that is payable to the Building Designer as agreed by the Client and the Building Designer.

A.8 Hourly Rates: The hourly charge-out rates of the Building Designer set out in section G of Part 2 of this Agreement.

A.9 Project: The project identified in Part 1 of this Agreement, more specifically detailed in section C of Part 2 of this Agreement.

A.10 Project Schedule: The period of time agreed by the Client and the Building Designer for completion of the Services as set out in section E of Part 2 of this Agreement.

A.11 Services: The Services to be performed by the Building Designer as specified in the Part 3 of this Agreement. Services may be varied by the Client in accordance with this Agreement.

A.12 Site: the premises where the Works are to be carried out.

A.13 Works: any permanent or temporary structure, building, fixture or access constructed or required to be constructed on the Site as part of the Project.

B. Building Designer’s Obligations

B.1 The Client and the Building Designer shall work together in a spirit of mutual trust and cooperation. In relation to the Services, either party shall advise the other upon becoming aware of:

• B.1.1 A need to vary the Services, the Project Schedule or Construction Cost, the fees and/or any other part of this Agreement
• B.1.2 Any incompatibility with any of the Client’s requirements in the Brief or between the Brief, any Client’s instructions, the Construction Cost, the Project Schedule and/or the approved design or any need to vary any part thereof
• B.1.3 Any information or decisions required from the Client or others in connection with the performance of the Services
• B.1.4 A need to appoint consultants or other persons to design or carry out any part of the Works or to provide specialist advice or additional inspection services in connection with the Project, and the parties shall agree how to deal with the matter.

B.2 The Building Designer shall provide the Services set forth in this Agreement exercising a reasonable level of skill and care ordinarily provided by Building Designers practicing in the same or similar locality under the same or similar circumstances.

B.3 The Building Designer shall perform the Services with due regard to any schedule, including the Project Schedule, and/or budget agreed with the Client. Notwithstanding the aforesaid, the Building Designer does not warrant that the Services or the Project will be completed in accordance with any such schedule or budget, nor does the Building Designer warrant that approvals from third parties will be granted.

C. Client’s Obligations

C.1 The Client shall supply the Building Designer with the Brief and shall advise the Building Designer of the relative priorities of the Brief, the Construction Cost and the Project Schedule by way of meetings and written directions or communications as necessary to ensure complete understanding of such Project priorities by the Building Designer.

C.2 The Client will directly appoint all other consultants required by the Project which may include, but is not limited to: cost consultant, landscape architect, engineers and surveyors. The Client will require that said Consultants maintain professional liability insurance as appropriate to the services provided. Upon the Building Designer’s request the Client shall furnish the Building Designer with copies of the Consultant’s scope of service.

C.3 The Client shall directly appoint the contractor and where required subcontractors and require that said contractor and subcontractors maintain professional liability insurance as appropriate to the services provided. Upon the Building Designer’s request, the Client shall furnish the Building Designer with copies of the contractor’s and subcontractors’ scope of service.

C.4 The Client shall hold each such Consultant/subconsultant/contractor/subcontractor, however appointed, and not the Building Designer, responsible for the proper performance of their services and shall require such other party(s) to cooperate with the Building Designer to enable the Building Designer to properly and effectively perform the Services.

C.5 Where decisions are required of the Client, such decisions shall be given in a reasonable time to the Building Designer to enable the Building Designer to perform the Services properly and in a timely manner.

C.6 The Client shall commit adequate resources to the Project to enable the Building Designer to perform the Services properly and in a timely manner.

D. Fees

D.1 The Client must pay to the Building Designer, in accordance with Part 2 of this Agreement, all fees due plus applicable taxes and expenses as specified in Part 2 of this Agreement. The Fee Proposal is based on the Project Schedule stated therein. If the Services covered by this Agreement have not been completed within the period allowed under the Project Schedule through no fault of the Building Designer, an extension of the Building Designer’s Services beyond that time shall be compensated as additional services and chargeable by the Building Designer on an hourly basis at the Hourly Rates.

D.2 In addition, the Fee Proposal covers only the Services set out in Part 3 of this Agreement. Any additional services required to be performed by the Building Designer over and above such Services shall also be chargeable on an hourly basis at the Hourly Rates. The Building Designer shall advise the Client as soon as practicable that additional services have been, or are being, carried out and that, as a consequence, additional fees are payable.

D.3 All fees are to be paid within [7 days] of invoice. Amounts due under an invoice and not paid within the period stated above will be subject to interest at a rate of [15%] per annum. Interest will be applied pro rata on the outstanding balance by dividing the rate by 365 to obtain a daily rate and multiplying that percentage by the number of days the balance is overdue. If the fees are not cleared in the Building Designer’s bank account by the due date, the Building Designer does not guarantee to continue to provide the Services.

D.4 Where, for any reason, the Building Designer provides only part of the Services set out in the Part 3 of the Agreement, the Building Designer shall be entitled to payment in full for all Services completed together with a fair and equitable proportion of the outstanding fee, to reflect the proportion of partial services completed.

E. Set Off

E.1 The Client may not deduct, reduce or withhold any payments due to the Building Designer under this Agreement by reason of claims or alleged claims against the Building Designer.

F. Copyright and Licence

F.1 The Building Designer retains copyright in all designs, drawings, models, plans, specifications, design details, photographs, brochures, reports, notes of meetings, CAD materials and any other materials provided by the Building Designer in connection with the Project (“the Materials”).

F.2 The Building Designer hereby grants, subject to payment of all outstanding fees, to the Client a non exclusive limited licence to use and reproduce the Materials for all purposes relating to the Project.

F.3 The Building Designer shall have no liability for any use of the Materials other than that for which the same were originally prepared and provided.

F.4 Such limited licence shall, in any case, not extend to the Client developing (whether itself or through a third party) any models or merchandise based on the Materials. Any such activity would be subject to separate terms, including an entitlement of the Building Designer to suitable royalties.

F.5 If the Building Designer rightfully terminates the Agreement for causes as specified in section K, the licence granted under section F will be revoked.

G. Publicity

G.1 The Client shall, where required by the Building Designer and subject to section F above, in any publicity relating to the Project, credit the Building Designer as Building Designer.

G.2 The Building Designer shall be entitled to royalties on any invention, new product or exploitation of any images arising out of the Services and/or the Materials.

G.3 The Building Designer shall have the right to publish photographs and information about the Project in its practice brochure and other promotional material.

H. Insurance

H.1 The Building Designer shall take out and use reasonable endeavours to maintain the following insurances for the duration of the period of liability referred to in clause I.4:

• H.1.1 Professional Indemnity Insurance in the sum of not less than $5,000,000
• H.1.2 Public liability insurance in the sum of not less than $10,000,000

I. Liability

To the maximum extent permitted by law:

I.1 Subject to the remaining clauses of this section, the Building Designer’s total liability to the Client under this Agreement (including the performance or non-performance of the Services), whether under the law of contract, in tort, in equity, under statute or otherwise, is limited to the maximum amount (after deducting any excess payable) the Building Designer is entitled to recover under any of the contracts of insurance set out in section H in respect of any fact, matter or circumstance giving rise to the liability.

I.2 The extent of the Building Designer’s liability, whether in contract, in tort, in equity, under statute or otherwise, is reduced proportionately to the extent that the Client and/or any other person, including any third party, has contributed to the claim, liability, damage, loss or expense and irrespective of whether such contribution arises in contract, tort or otherwise.

I.3 If the Building Designer is liable to the Client, whether in contract, in tort, in equity, under statute or otherwise, the Building Designer will only be liable for any reasonable foreseeable and fully mitigated damage, loss or expense incurred by the Client, caused directly by a breach of the Building Designer’s legal obligations. The Building Designer has no liability to the Client in respect of any indirect, consequential or special losses (including loss of profit, loss of business, opportunity and payment of liquidated sums, or damages under any other agreement).

I.4 The Building Designer has no liability in respect to the Services after the expiration of [1 year] from the completion of the Services subject to any compulsory limitation of action provisions which cannot by law be excluded or restricted in any contracts made between the parties.

I.5 In the circumstances where the Services (as described in Part 3 of this Agreement) are reduced, limited or varied by later agreement or the Agreement is terminated prior to the completion of the Services, the Building Designer’s liability will attach only to those services actually performed and then only to the extent that the reduction of that part of the Services has not compromised or not denied the Building Designer the opportunity to correct the performed services or to otherwise mitigate the Client’s loss.

I.6 The Building Designer is not liable for any damage, loss or expense incurred by the Client as a consequence of any change that the Client or any other person makes to the Building Designer’s construction documents, or from any variation to the Works from the Building Designer’s construction documents or any variation to the Project resource consent or the Project building consent, made without prior written notice to or approval by the Building Designer.

I.7 The Building Designer shall not be liable to any person other than the Client, and disclaims responsibility, in tort or otherwise, for any liability, damage, loss or expenses suffered or incurred by such person. In the event that the Project to which the Services relate is leased, transferred, sold, or otherwise disposed of in part or whole to other persons, then the Client warrants that such persons shall be advised in writing that the Building Designer accepts no responsibility in law to them. In the event of breach of this clause, the Client and in the case of a company, its directors, shall fully indemnify the Building Designer against any claim by such persons, whether such claim is in tort or otherwise.

I.8 The Client shall indemnify the Building Designer against the adverse effects of all claims including claims by third parties which arise out of or have a connection with this Agreement and are made after the expiry of the period of liability referred to in clause I.4 subject to any compulsory limitation of action provisions which cannot by law be excluded or restricted in any contracts made between the parties. For avoidance of doubt the indemnity includes claims in negligence made against the Building Designer.

I.9 The Client acknowledges that the Building Designer operates through employees, directors, officers, agents and sub-consultants and agrees that no reliance has or will be placed on them personally by the Client in connection with this Agreement on the performances of the Services.

I.10 The limitations of liability as described above will confer, to any extent relevant, a benefit on the employees, directors, officers, agents or sub-consultants of the Building Designer.

I.11 If any of these clauses is void as a result of any applicable legislation, or any regulations or rules promulgated thereunder, then the Building Designer’s liability for a breach of a condition or warranty is limited to the:

• Supplying of the relevant services again or
• Payment of the cost of having the relevant services supplied again.

J. Assignment

J.1 Neither the Building Designer nor the Client shall assign the whole, nor any part, of the Agreement without the consent of the other in writing. Such consent shall not be unreasonably withheld.

K. Termination or Suspension

K.1 The Client may suspend the performance of any or all of the Services, by giving not less than [7 days] notice to the Building Designer, specifying the service or services to be suspended.

K.2 The Building Designer may suspend performance of the Services and its obligations under this Agreement by giving [7 days] notice to the Client of the intention to do so and the grounds for doing so, in the event that the Client is in default of payment of any fees, or other amounts due, or is otherwise in default of its obligations hereunder. When the reason for the suspension is removed or resolved, the Building Designer shall resume performance of the Services and its obligations.

K.3 If any period of suspension arising from a valid notice served either by the Client on the Building Designer, or served by the Building Designer on the Client, exceeds [6 months], the Building Designer shall be entitled to treat this Agreement as being terminated with immediate effect.

K.4 The rights to terminate this Agreement shall not prejudice any other right or remedy of either party in respect of any breach or cause of action accrued at the date of termination.

L. Dispute Resolution

L.1 The parties shall seek to resolve any dispute or difference arising under this Agreement in good faith.

L.2 If the parties cannot resolve such dispute or difference within [7 days] of either party serving notice on the other that a dispute has arisen, then either party may submit the dispute to mediation by delivering to the other a written proposal of mediation.

• L.2.1 A proposal of mediation must state the name of the mediator accredited by an appropriate professional body in the state or territory of the law that applies; who is independent and willing to act.

L.3 If the parties are unable to agree on the choice of a mediator, or if the chosen mediator is unable or unwilling to act, then within [7 days] after the proposal is delivered, the president of the chapter of Building Designers Assocication in the place of the law that applies, must be requested to nominate a mediator.

L.4 Any agreement between the parties shall be recorded in writing and, once signed by representatives of the parties, shall be binding on the parties.

L.5 The parties will bear their own costs of preparing and submitting evidence to the mediator. If the mediator finds that the mediation has been initiated or conducted frivolously or vexatiously then the mediator shall have the power to order the party so initiating or conducting the mediation to pay the reasonable costs of the other party for preparing for and attending the mediation. If such costs cannot be agreed, then these costs will be assessed by the mediator whose decision shall be binding on the parties.

L.6 If the parties are unable to resolve the dispute or difference by mediation, confirmed by the mediator in writing, either party may take legal action to resolve the dispute.

M. General

M.1 The law applicable to this Agreement shall be the law of the state or territory of the Building Designer’s address stated in this Agreement.

M.2 The Building Designer shall be entitled to rely upon the accuracy and completeness of:

• the information furnished by the Client and
• the Client’s approvals.

M.3 The Building Designer is not responsible for ensuring the Project complies with the building contract documents, but when engaged for contract administration services, is required to instruct the building contractor regarding requirements of the building contract documents, according to the contract terms.

M.4 The Building Designer gives no express or implied warranty that the Project is fit for the Client’s purpose.

M.5 Any natural materials selected for the Project may change in appearance and dimension following exposure to use or climatic conditions and this is normal behaviour for such materials.

M.6 The scope of the Services does not include any services in relation to asbestos, other hazardous materials, or any other site contaminant.

M.7 Upon the completion of the Project, the Client is responsible for ongoing and regular maintenance of the Project, including its systems, finishes and equipment.

M.8 Nothing makes ineffective, or reduces, any protection at law from liability which the Building Designer is entitled to in the state of territory of the applicable law.

M.9 This Agreement supersedes all prior agreements relating to the Services for the Project, and does not apply to any services provided by the Building Designer before the formal execution of the Agreement.

N. Notice of Defects

N.1 If, during the term of the Agreement or after completion of it, the Client becomes aware of any problem with the design, fault or defect in the Project, or non-compliance with the Project’s contract documents, the Client must promptly, but not later than [X] business days after becoming aware of it, notify the Building Designer about it in writing. If the Client does not do this, the Client will be treated as having waived any claim the Client may have against the Building Designer (in contract, tort or otherwise) in relation to the problem, fault or non- compliance.