module 04 | professional development + practices Flashcards
what is negligence liability?
the designer has failed to use due care as expected of a professional in carrying out their design responsibilities
also referred to as professional negligence
what is breach-of-contract liability?
the failure to complete the requirements of a contract
what is strict liability?
one’s full responsibility for their actions
if a designer is looking to hang a large mirror on a wall of an old building, what conditions is the designer responsible for documenting?
- existing wall condition
- size + weight of the mirror
- special mounting requirements
how does errors + omissions insurance protect the designer? (also known as professional liability insurance or malpractice insurance)
the designer is protected if there is any personal or financial harm from an act, error, or omission due to the designer’s services
in the case of a large mirror being hung from an old wall, what type of insurance would protect the designer if the product failed to perform as intended?
product liability insurance
on the idfx exam, when deciding between two answers dealing with code, what is a good rule of thumb?
choose the answer that is better for life safety
what are the two main types of regulation of the interior design profession, in regards to job titles?
- practice acts
- title acts
what is a practice act?
practice acts establish what an individual can or cannot do in practice as a licensed professional
what type of regulation defines who can use a professional title while also restricting who can perform certain professional acts?
practice act
what is a title act?
a title act limits who can use professional titles - allowing those who have completed education + exams to use a modified title
what is the benefit of having a modified title?
a modified title shows a client that the designer has recognized qualifications
which type of regulation forbids a person from using a title like “architect” or “engineer” without being properly licensed?
a practice act
what type of business structure is started, owned, an operated by a single individual?
a sole proprietorship
in a sole proprietorship, who holds responsibility for legal + financial liabilities of the business?
the owner
what are the three types of business partnerships?
- general partnership
- limited partnership
- limited liability partnership (llp)
in a limited partnership, how much is each partner liable for?
each partner is only liable up to the amount of their investment
which of the following is a separate legal entity:
- limited liability company
- corporation
- sole proprietorship
corporation
what is a balance sheet?
a form that shows the firm’s financial position at a particular moment in time
what is an income statement?
a report that displays all the revenues and expenses of a firm for a stated period of time
what is the result of creating an income statement?
the result shows the net income
how does net profit differ from gross profit?
gross profit is revenue minus the cost of goods sold
net profit is revenue minus all operating expenses, taxes, and interest
what is the term for the amount of money coming into a firm from selling goods or rendering services during an accounting period?
revenue
what three types of claims does general liability insurance cover?
- property damage
- liability
- personal injury
what three parties does general liability insurance cover?
- employees
- consultants
- others hired by the designer
what type of insurance protects the designer’s building from disasters like floods, fire, and theft?
property insurance
what is a tort?
a civil wrong that causes injury
what is the best way to minimize exposure to liability?
through contracts and insurance documentation
what is the term for the act of suing for something outside of the designer’s job / scope?
third party claim
what is an rfp?
request for proposal
what does an rfp entail?
a document created by the client that contains key information the client seeks from an interested design firm
what pieces of information are included in an rfp?
- full scope of requested services
- project description
- proposal requirements
- submission due date
how does an rfp differ from an rfq?
an rfq displays a firms capabilities + experience whereas an rfp details how a firm would tackle the project
if additional services are not outlined in a secondary contract, how are they charged to the client?
additional services should be billed hourly with an identified rate schedule
what do exclusions within a contract verify?
exclusions clarify what the designer is not legally liable for
what is a performance bond?
a statement by an insurance company that ensures project completion, should the contractor default on their obligations
what is a labor + materials performance bond?
a promised payment to labor and for materials should the contractor default
what does a labor + materials performance bond protect the owner from?
it protects the owner from the lien (the right of a subcontractor to keep property held by the owner until a debt has been paid)
within aia standard agreements, a-series are agreements between which parties?
the owner and the contractor / vendor
within aia standard agreements, b-series are agreements between which parties?
the owner and the architect / designer
what do b-series agreements outline?
- scope of work + schedule
- cost for the work
- all fees
what is a lien
the right of a subcontractor to keep / possess property of the owner until a debt is paid
what is the role of osha for a worker?
osha strives to assure safe + healthy working conditions by setting and enforcing standards
what does osha provide to the workforce / employers?
- training
- outreach
- education
- assistance
what is the purpose of the fair housing act (fha)?
the fha makes discrimination in the sale, renting, and financing of a home based on race, gender, disability, etc illegal
true or false: the ada is a civil rights law.
true
what is the purpose of the americans with disabilities act (ada)?
to ensure people with disabilities have equal opportunities in various aspects of life
which three entities set ethics standards?
- cidq
- local jurisdiction
- professional organizations
true or false: the individual against whom an ethics complaint is made must be a member of one of the professional associations.
true
a client cannot expect an association to discipline someone who is not a member
what is price discrimination?
the act of charging different prices for the same goods
who does price discrimination affect?
only sales between merchants
what is the main purpose of interior design professional associations?
they provide tangible and intangible business benefits
CEUs need to focus on “health, safety, and welfare.” what components make up hsw?
- codes, standards, and materials
- ethics, psychological well-being, and materials
- codes, ethics, and psychological well-being
- materials, ethics, and standards
codes, ethics, and psychological well-being
are codes of ethics considered standards of law?
no, ethical standards are a higher standard than the law
in some states an interior designer is required to have a license to practice design. this requirement is based on a state’s…?
- state regulatory requirements
- practice act
- exclusionary legislation
- title act
practice act
which of the following is not a true statement about specs?
- specs are a legal document
- specs to not include standards that cannot be measured
- specs specify the results and methods of construction / fabrication
- specs should avoid exculpatory clauses that try to shift the responsibility to the contractor or someone else in a broad, general way
specs specify the results and methods of construction / fabrication
which is more stringent a practice act or a title act?
practice act
why is a practice act more stringent than a title act?
a practice act limits the activities an individual can perform
practice acts prohibits individuals from engaging in certain activities until the person meets qualifications established by a state board / become licensed
what is it mean to act with fiduciary responsibility?
to act in the best interest of another person / entity
what factor sets a limited partnership apart from a general partnership?
a limited partnership contains investment from a party outside of the working partners
how is a hedge fund an example of a limited partnership?
a hedge fund functions with a general partner that manages a portfolio of investments; the limited partners are those that provide capital
limited partners do not have participate in business operations
why are limited liability partnerships popular among professional service firms? (i.e. architecture firms or law firms)
limited liability partnerships are popular because they allow partners to share profits while limiting personal risk exposure
what type of businesses use a limited liability partnership model?
- law firms
- architecture firms
- medical practices
- financial advising businesses
a limited liability company (llc) is a hybrid of which two business models?
- general partnerships / sole proprietorships
- corporations
what is another name for the owner of an llc?
a member
what must the legal name of a limited liability company include?
the words “limited liability company” or the initials “llc” or “lc”
what is the most time-consuming and expensive method of forming a business?
forming a corporation
what is a corporation?
an association of individuals created according to a statutory law
what is the term for a member of a corporation?
stockholder or shareholder
what are two reasons why a corporation being a legal entity is a good idea?
- corporations allow for originators to be independent of the organization
- corporations allow for originators to sell stock to outside parties
if a firm employs other individuals, which funds must the business withhold?
- federal income tax
- social security
- medicare
what type of insurance protects the designer in case of designer-caused injury or property damage?
professional liability insurance
which three claims does general liability insurance cover?
- property damage
- liability
- personal injury
what type of insurance protects the designer against charges of slander, libel, defamation, or misrepresentation?
personal injury protection insurance
what must time and fee estimations be linked to in the provided proposal?
the project scope description
what is the term for the all activities a designer will perform in exchange for a fee?
project scope
where are the most common design services outlined?
aia document b152
true or false: aia document b152 lists other services not outlined in a standard contract.
true
how should additional services be billed?
hourly
in a contract, what do exclusions clarify?
exclusions clarify what the designer is not legally liable for or able to perform
in what document should the designer’s fee be outlined?
the contract
what is the main function of sending drawings and specs out to bid?
bidding is a way of getting competitive pricing
how many days prior to the bid opening should a bidder submit a substitution?
at least 10 days
what four elements should every contract include?
- an offer
- acceptance
- consideration
- mutual agreement
what is outlined in a general conditions document?
the responsibilities + liabilities or the owner, designer, and contractor
what does indemnification protect an owner and designer from?
loss or damage if a person is injured because of the contractor’s negligence
a101 - 2017
standard form of agreement between owner and contractor where the basis of payment is a stipulated sum
a201 - 2017
general conditions of the contract for construction
a151 - 2019
standard form of agreement between owner and vendor for ff+e
a751 - 2019
invitation and instructions for quotation of ff+e
b-101 - 2017
standard form of agreement between owner and architect
b152 - 2019
standard form of agreement between owner and architect for interior design and ff+e design services
what should a designer do to prevent lawsuits?
assume nothing and document everything
a designer should not assume responsibility for anything they cannot control
what is the purpose of terms and conditions?
to identify the rights and responsibilities of parties agreeing
how does a project manager estimate the number of hours a firm can spend on a project while still profiting?
divide the money + time each project phase will need by the average billing rate for each designer
what type of fee structure specifies a fee that will cover all work and expenses laid out in the scope of services?
lump-sum fixed fee
using a lump-sum fixed fee model, can the agreed upon fee be increased?
no
what is a cost-plus percentage markup?
the designer sells merchandise to the client and the client pays a specific markup of the actual cost
what is a cost-plus fixed fee?
the client pays the actual cost of the work plus an amount for overhead + profit
