Professional Practice Flashcards

1
Q

Standard of Care

A

providing a service that is equal to the standard in the area - doing the same thing another architect under the same conditions would do expected quality of service - determines if an architect is at fault

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2
Q

Why is a warranty not included in the contract?

A

you are creating a “guarantee” with a warranty - this creates an unacceptable level of risk and obligation. This would not be covered by professional liability insurance

the following phrases in a contract may void professional liability insurance
-as necessary
-as required
-Hold Harmless
-Indemnification

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3
Q

Standard AIA contracts are…

A

prepared for and by the AIA. these are the most common contracts used. Sections may be adjusted by a client or architect

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4
Q

Which building typology is most prone to litigation?

A

Condos
-expensive to build and own
-condo association - Lawyer’s on staff

-residential risks are higher in general
-clients not experienced with construction industry
emotional attachment to homes

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5
Q

What is the goal of Risk management

A

not about eliminating risk but about ASSESSING and MANAGING it

  • understand the risk in a project and build it into the fee
    -do not take every project

unknown clients, inexperienced owners, history of litigation = higher risk

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6
Q

Addendum

A

drawings that are issued after they have gone to bid but before a contractor/bid has been selected

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7
Q

Allowance

A

Providing a sum built into the contract to allow for something to be bought in the future for the project

  • casework, appliances, specialty light fixtures
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8
Q

Change Order

A

occurs after the contract has been signed by the contractor when something needs to be changes

contractor, owner and architect must all agree and sign this

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9
Q

Underbidding

A

contractors can underbid and plan to request change orders so they can charge a premium
-unethical
-why there are requirements to be met when selecting bidders

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10
Q

Construction Change Directive

A

Architect will direct a contractor to change something

  • usually happens when there is a dispute but the project needs to move forward as the dispute is managed (could be cost of a change order)
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11
Q

Design-Bid-Build

A

Traditional form of architecture/construction project

Architect > Bid > Contractor is selected
(CSP)

Linear, roles clearly defined

Architect + owner contract
Contractor + owner contract

takes a long time - the owner and architect want documents as correct as possible to minimize change orders
less expensive because its a final bid
not good if youre in a hurry

contractor cannot sue directly to architect here because they dont share a contract

Contractor responsibilities
-everything in the contract, no matter what, and nothing that isnt in the contract

Owner responsibilities
-responsible for everything needed that is NOT in the contract documents, even f the architect overlooked something
could be
-change order, site condition, asbestos, hazardous materials

Architect Responsibilities
(AIA contracts protect the architect)
-liable for not much
-responsible for a lot
-instruments of service (drawings, specs, models, etc)
-arriving on time
-being under budget
-coordination

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12
Q

Owner Responsibilities

A

What is on site
-geotech
-hazardous materials
-site conditions
-site boundaries, easements etc
-permitting/legal
-surveyors
-regulations, permitting and compliance
-traffic -

Paying contractor
Paying owners consultants
Change orders
With or without cause hiring and firing of architect

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13
Q

Contractor Responsibilities

A

everything in the contract (documents, specs, etc)

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14
Q

Architect Responsibilities

A

(AIA contracts protect the architect)
-liable for not much
-responsible for a lot
-instruments of service (drawings, specs, models, etc)
-arriving on time
-being under budget
-coordination
-administration

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15
Q

Architect Base Services (consultants)

A

Structural Engineer
MEP engineers

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16
Q

Architect Additional Services (Consultants)

A

Civil Engineer (sometimes hired by owner)
Landscape Architect
Security Consultant
Tech Consultant
Lighting Consultant
Acoustic Consultant
AV Consultant
Cost Estimator
Code Consultant
Sustainability Consultant

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17
Q

Contractor/Construction Manager (Consultants)

A

Plumber
Demolition Company
Subcontractors, etc

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18
Q

AIA B101 (owner-architect) insurance requirements

A

Automotive Liability Insurance
General Liability Insurance
Professional Liability Insurance
Workers Compensation Insurance
Employers Liability Insurance

Consultants are required the same insurance

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19
Q

AIA B101

A

owner-architect agreement

for design-bid-build

requires we consider environmentally responsible design alternatives

practice standard of care

keep to a schedule (on time and on budget (+10%)

obliges architect to get a cost estimate after SD, DD, CD - owner in writing states it is ok to proceed - approval after CD allows you to bid
(if architect does not meet bid budget, it can be on architect to redesign for free)

EXCUSES architect from mistakes associated with OWNER hired consultants (add service to coordinate)

obliges the architect to visit the site one year after substantial completion

takes no responsibility for contractor

takes no responsibility for shop drawing accuracy - only for intent

administration of the construction contract bid process

administration of the contract
-checks that project is running smoothly, not responsible for contractor’s work, architects drawings must depict necessary details for the contractor

responding quickly to Requests for Information (RFIs)

architect can be fired “for convenience” - owner has to pay up to what the architect has done and what the consultants are owed + the profit the firm expected from the project

the architect cannot transfer the contract
-if an owner changes, they must acquire the contract

one year warranty required

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20
Q

AIA A101

A

owner-contractor agreement

for design-bid-build

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21
Q

Automotive Liability Insurance

A

car accidents are one of the biggest risks for a firm
-owner may require firm to have this
-it extends to personal cars and taxis, not just company cars

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22
Q

General Liability Insurance

A

Basic insurances that covers physical property damage and injury claims against the firm
-covers legitimate and fraudulent claims

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23
Q

Professional Liability Insurance

A

Errors and Omissions insurance
provides protection if someone accuses you of not doing your job correctly
covers mistakes made by the architect

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24
Q

Workers Compensation Insurance

A

in case of an injured worker it provides wage replacement and medical care costs. Employees waive the right to sue the firm.

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25
Business Interruption Insurance
Pays expenses and loss of profits if work is interrupted usually due to natural disasters, fires, hurricanes, floods, etc
26
Intellectual Property Insurance
covers you if someone else claims you infringed on their copyright or pays out the claim if you didnt steal the idea
27
Employment Practice Liability Insurance
Lawsuits -wrongful termination -discrimination -sexual harassment
28
Contractual Liability Insurance
covers you when something goes wrong and you are held responsible for it by the contract. this is covered under general liability insurance. Covers liability owner assumes from the contract. To pay on behalf of the indemnitor the damages to the third party. is for non-professional incidents like a fall or dog bite at the office.
29
Disciplinary, Regulatory or Administrative Expenses
Sub-component of Professional Liability Insurance - state licensing board, OSHA, ADA, Fair Housing act etc --- this protects you in they say you violated a rule
30
Professional Liability Insurance
Covers you if you do something wrong unintentionally
31
General Liability Insurance
Accidental Insurance
32
Aggregate Limit (insurance)
max amount paid by insurance company
33
Pay application
Architect acts as the owners representative as a professional in the industry - it is the architects responsibility to review pay apps and confirm the amounts the contractor is charging align with the work completed/purchased on site
34
Contract Change
Scope Change (program, cost, time etc) this is an addendum to the contract, owner must review and sign
35
Who owns the drawings after the building is built?
Architect architect gives owner and contractor a limited license to use the drawings Architects can sell the drawings (usually when they want to build multiple) -charge for drawings + lost profits for what you would make if we designed the other x amount of buildings -requires a clause indemnifying the architect - owner must take full responsibility for how the drawings will be executed by other architects and contractors
36
Indemnify
Hold harmless, remove liability
37
When can the owner get rights to the drawings, even if the architect doesn't want to give them away?
Architect was terminated for cause - the architect and consultants still have copyrights to their drawings in this case
38
Additional Services
(this was AIA's way of getting the architect more money) Programming Multiple Preliminary Designs Measured Drawings Existing Facilities Surveys Site Evaluation and Planning Building Information Modeling Civil Engineering Landscape Design Architectural Interior Design Value Analysis Detailed Cost Estimating On-site project representation Conformed Construction Documents As-Designed Record Drawings As-constructed record drawings Post-Occupancy Evaluation Facility Support Services Tenant-related services Coordination of owner's consultants Telecommunications/Data Design Security Evaluation and Planning Commissioning Extensive Environmentally Responsible Design LEED Certification Fast-Trak Design Services Historic Preservation FFE - Fixtures, Furnishings and equipment design
39
Circulation Area
Circulation, including elevator lobbies, hallways and corridors
40
Gross Area
everything inside the OUTSIDE edge of the enclosure (so everything)
41
Net Area
total identified program space, not including circulation, mechanical, toilets etc. Just where work will happen
42
Rentable Area
everything that isn't shared on other floors (mechanical, elevators, stairs, etc)
43
Usable Area
Everything but the core
44
Floor Area Ratio (FAR)
Floor area x levels / site area measures efficiency of the plan
45
Net to Gross Area
Net area / gross area usable space out of total space - closer to 1.0 the better
46
Direct Salary Expense Multiplier
generally 3-4 of base salary this is what gets charged over the base pay of employees to cover indirect salary, overhead, profit Same as net multiplier
47
Overhead Rate
Indirect expenses / direct expenses Total overhead / Direct Salary for every $1 we pay our employee, we have an additional $x expense for the firm (does not include profit)
48
Break-even multiplier
Overhead Rate + 1 Total overhead + Direct Salary / Direct Salary
49
Direct Salary Expense Multiplier (DSE)
Total Overhead + Direct Salary + Profit goal ________________ Direct Salary How much we need to charge about the direct salary of employees to cover overhead and profit
50
Utilization Rate
Total Direct Salary / Base Salary Base Salary is direct + indirect salary (what the employee is paid by the company) How efficient is the employees hours (billable to client)
51
Revenue Factor
yield on total payroll measures firm profitability Fee revenue per dollar spent Utilization rate * Direct Salary Expense Multiplier = revenue factor (70% * 3) = 2.1 over 2 is a good indicator of a healthy balance of work and fees
52
Negotiated Select Team
Construction Manager is included early sub-flavor of Design bid build bring contractor in at early design with a contract and incentives allows difficult portions of work/fabrication to begin early quicker, better quality (you get the pick the contractor), can be more expensive because there is no bid
53
Negotiated Bid
better quality
54
Competitive Bid
Lower construction cost
55
Invited Bid
Special qualifications needed for program
56
Cost Plus Fixed Fee (contractor)
contractor is disincentivized from allowing construction costs to inflate Time + materials + overhead (coordination) + fixed profit another type of design-bid-build contractor is selected after documents, but it is not a typical bid Fixed Fee allows contractor to keep profit and be flexible with owner and architect if something changes good if there may be unknowns on the site (brownfield)
57
Construction Manager as Advisor
Owner hires the construction manager early and they work with the architect. usually has expertise that can reduce cost and time. owners rep Owner has separate contracts with architect, construction manager, contractor
58
Construction Manager as Agent
Owner hires construction manager to manage and administer the contract in their place. CM has More authority and control, minimal risk, brought on early Owner > CM CM > architect and contractor
59
Construction Manager as Constructor/at Risk
Construction manager IS contractor Construction manager and architect are engaged at the same time quicker and less risky for owner, but typically more expensive minimal bidding
60
Design Build
Owner has one single contract that covers the architect and contractor. The architect is no longer the agent of the owner. The architect and contractor are a team. less risk quicker because there is no bid process Can reduce Quality
61
Bridged Design Build
The owner hires a "bridging consultant" usually the design architect who designs SD and maybe DD set. they represent the owner with the contractor. owner has design architect contract and production architect/contractor contract (the design build team) Design build teams designs CD set and constructs building
62
Integrated Project Delivery (IPD)
owner, architect, and contract are all under one contract together join together as a single entity share information with each other w/o fear of litigation share benefits and risks of the project with each other works well with BIM used mainly for large and complex projects right now (hospitals) less time spent covering self and more time on design (minimal disputes) Challenges owners are resisitant insurance industry doesnt know how to cover oversaring - intellectual property not for risk adverse
63
Strategic Alliance
a temporary teaming agreement a group of people agreeing to work with each other to get or for a project and then are no longer bound (friendship/group project) they share information and technology (if one person get sued, everyone can get sued)
64
Joint Venture
2 companies get together to make a 3rd company that is jointly owned (baby company) usually after project is awarded to architect (an architect may join a joint venture with engineers for a project) may dissolve at the end of the project or continue profits are shared (if one person get sued, everyone can get sued)
65
Partnership
like a marriage, everything is shared and acts as 1 company (if one person get sued, everyone can get sued)
66
C Corporation
large public company like Apple or Google that has a lot of stock has liability protection is double taxed - corporate income tax and taxes on bonus wages/dividends good for medium to large firms Double Taxed, profits, then after dividends the profit is taxed again
67
Limited Liability Corporation (LLC)
provides simultaneous liability protection and avoids double taxation file this with the state federal tax ID if you are sued at work, you can lose your home/assets - LLC separates personal investments from your professional activity can still have partners - all equally liable good for all size firms Tax Classification: Sole proprietorship, S Corporation, C Corporation, Partnership (lots of options)
68
Sole Proprietorship
not registered with the state provides no liability protection no separation between personal and professional assets no double taxation not enough protection for architecture or construction professionals can be sued easily Tax Classification: Sole proprietorship (all taxed as one)
69
General Partnership
like a sole proprietorship - no liability protection important to get everything in writing (partnerships dissolve often because it isnt documented) document ownership structure, management structure, risks, liabilities, roles of partners etc
70
Limited Liability Partnership (LLP)
provides simultaneous liability protection and avoids double taxation almost identical to LLC but can have partnerships at different levels of interest/liability (investors) file this with the state federal tax ID if you are sued at work, you can lose your home/assets - LLC separates personal investments from your professional activity good for all size firms Tax Classification: Sole proprietorship, S Corporation, C Corporation, Partnership (lots of options)
71
B Corporation
(think Ben and Jerry's) allowed to define "success" more broadly than a typical bottom line often includes social and environmental responsibility establishes another motive for future growth to hold onto
72
Triple Bottom Line
Profit + People + Planet
73
Scheduled Performance Index (SPI)
earned value / planned earned value what have you been paid / what should you be paid at this point closer to 1 means you are on track
74
The Fair Labor Act
Establishes minimum wage establishes which employee is management - management is not entitled to overtime pay people that are not part of management require overtime pay for time worked over 40 hours per week (1.5x) forbids child labor
75
The Davis Bacon Act
public works projects - says a fair local prevailing wage shall be paid
76
The Occupational Safety and Health Act
OSHA - Occupational Safety and Health Administration protects workers from hazards on the job -excessive noise levels, dangerous mechanical conditions, unsanitary conditions, excessive heat or cold, physical stress enforces workplace safety regulations for things like construction falls, exposure to dangerous elements, requires safety vest and hardhats
77
The Affordable Care Act
Obamacare applies to architecture firms, HR specifically requires firms that have more than 50 employees to provide health insurance to 95% of employees or a fee will be charged
78
Phased Bid
Fast track construction portions of the construction will be bid on piecemeal design and fabricate parts before plans are finalized
79
Negotiated Bid
Contractor works with the architect from the beginning of the project final bid is between contractor and the owner increased quality at higher cost because the contractor is working with the architect in real time
80
Invited Bid
Design-Bid-Build only open to prequalified contractors
81
Surety Bonds
works like insurance that protects the owner if the contractor doesn't follow through with completing the project the third party insurer will pay the owner to finish the project regulated by the state insurance oversight agency works like posting bail the contractor buys to guarantee payment to the owner Bid Bond and Performance Bonds (types of surety bonds)
82
Bid Bond
AIA Document A310 an agreement that if the low bidder cannot follow through the work, the bid bond should pay the difference of low bidder's bid and the next lowest bid to complete the work both the owner and contractor are protected
83
Performance Bond
the third party offers to pay for the project to be completed if the contractor defaults
84
Business Performance Bond
used in building operations third party insurer
85
Contractor's License Bond
Insures contractors against breaking construction laws some states require this to maintain contractor license
86
Why are late bids not accepted on public projects?
the opening of sealed bids is done publicly. A late bidder cannot wait and see everyone elses bid and underprice the lowest bid to win. this prevents corruption
87
Sealed Bids
very strict rules we look for lowest responsive bid (most responsive to entire RFP - make sure it includes everything in the project) lowest responsible bidder (contractor reputation)
88
Contractor / continuing warranty
lasts one year everything must be completed correctly must fix anything during project and 1 year past substantial completion if something breaks 8 months in, contractor must fix/replace then it is a new 12 month warranty ends when statute of repose expires (25 year roof warranty means contractor is responsible for 25 years) does not cover improper operation/normal wear or work that was not done by the contractor contract can state to extend this period
89
Substantial Completion
when the building is fit for its intended use job is not finished, but meets intended use and the owner can move forward/in begins the 1 year warranty period if substantial completion is not met at the specified time, it is late
90
Final Completion
If it comes after the deadline, it is not considered late after substantial completion, there may still be work to be finished like landscape or other small items that do not prevent you from using the building architect declares the project in final completion (after punch list is complete)
91
Punch List
required to be completed by contractor not architect
92
Weather Delay Days
built into contract if abnormal weather, architect can decide if contractor is allowed to take extra time without penalty weather log shall be submitted with pay app
93
What is the path of the contractor's invoices to the owner? AIA G702
Contractor-Architect-Owner application and certificate for payment - to be signed and notarized by contractor
94
What is included in the pay app?
Change order summary the amount of money needed to complete the project the amount of current retainage for the work-in-place the amount of current retainage for stored materials certification that the subs have been paid
95
Retainage
Money owed to the contractor but intentionally not paid yet a % defined in the contract per invoice that is held and paid at the end of the contract - this makes sure the contractor finishes the job so he gets his money at the end materials stored does NOT equal wok completed - there may be additional % retained for materials stored and not installed yet retainage gets paid at substantial completion but if there is a punchlist, an amount double the value of the punch list items is still held, to be released after the punch list is completed
96
Mechanic's Lien
Laws to make sure the subcontractor gets paid by the contractor if it goes to court, the owner will have to pay sub even if contractor says they did, if court determines sub was not paid, the can put a lien on the building until it is paid Architect's can file too if a building is designed but not built a claim against the owner's property due to unpaid debts
97
Shop drawings/Product Data submittals
architect to review for design intent, but contractor is responsible at the end of the day architect is responsible to review in a timely manner
98
Building Operation manuals
contractor shall provide 3 copies of maintenance and operations requirements for entire site
99
Post-Occupancy Evaluation (POE)
surveying occupant satisfaction; sees how well the building is performing 1+ years after occupancy this is about the humans - think about skylights at Walmart this is an add service and can improve future buildings
100
Accrual Basis Accounting (used by most firms)
profit loss statements count immediate spending or invoices sent as money used/accrued assume you have the money Day to day business is run by accrual basis accounting big companies use this and cash basis accounting - accrual used for day to day, cash for tax purposes
101
Cash Basis Accounting
Like a checking account Keep track of money in/out When you actually pay something, not when invoice is sent Taxes are cash based (use this method for taxes) big companies use this and accrual basis accounting - accrual used for day to day, cash for tax purposes small firms will only use this
102
Net Operating Revenue (NOR)
what is coming in - what is going out coming in design fees, admin fees, (fees paid by the client as a markup percentage for plotting, over and above the cost of plotting incurred by the firm) going out travel costs, overhead expenses, consultant fees what is let over to pay our architects (direct expenses), pay our utilities (indirect expenses) and pay our partners (profits)
103
Net Profit
before taxes and distributions (bonuses) - what is left after you've paid everyone and your bills, but before you pay taxes
104
Profit/Earnings Ratio
profit ___________________ (net operating revenue) after bills are paid before employees are paid *measures firm health* high is good
105
Current Earnings
what is left after everyone is paid and taxes are paid the profit left for the firm to keep calculated after taxes are deducted from income
106
Net Billing
the fee for the architect's time does NOT include billings for things like expenses, travel, plotting, and reimbursable sub consultants
107
Prospect/Suspect
prospect = a future potential client the firm feels likely will be realized as a revenue-generating project (over 51%) suspect = less than 50% chance of income generation
108
Profit Loss Statement
Reflects the results of a firm's operations in terms of its revenue, direct labor, indirect labor, indirect expenses, and net profit for a given period. Income statement The flow of money (income) how much came in as revenue? How much went out as expenses? Utilization Rate Overhead Rate Break-even Rate Net Multiplier Profit-to-earnings ratio Net Revenue per employee Aged Accounts Receivable
109
Profit-Earnings Ratio
Profit ------------------- earnings (net operating revenue) goal over 20% - how much we make out of how much we bill
110
Net Revenue per Employee
$$ revenue ---------------------- # of employees goal is $100,000 per employee
111
Aged Accounts Receivable
Average time between invoice date and the day we get paid goal to keep this under 90 days
112
Balance Sheet has the following measures
Provides a description of a firm's current financial condition for a period of time s of its assets, liabilities, and equity A snapshot of equity (wealth). How much was in the bank before the month began and again after the month O? Solvency = current assets/current liabilities Liquidity - immediate assets / current liabilities Leverage = liabilities/equity Return on Equity - profit/ equity
113
Solvency (current ratio)
Current assets _________________ Current Liabilities 1.5 is minimum goal
114
Liquidity (Quick Ratio)
quick cash cash on hands +accounts receivable + revenue ________________ Current liabilities this should be equal or higher than 1, otherwise you don't have enough cash to pay bills
115
Leverage (Debt to Equity)
Liabilities _________________ Equity (everything we own) should be less than 35%
116
Return on Equity
(sim to ROI) profit _______________ equity (everything we own) should be greater than or equal to 20% there is a lot of risk investing in a firm, so you want a higher ROI
117
Pro Forma
a business plan written on a spreadsheet - when you are starting a firm and need to provide the lenders with a business plan - how to get a firm started, realistic predictions also include a profit plan (sets financial goals as an established firm for next year) and financial feasibility (expected revenue of a given project operations) prepared in advance
118
Largest Expense for an architecture firm
employee salaries (the people)
119
Unit Pricing
when you may not know the quantity of something but you know there will be a quantity, you can provide unit procing helps compare bids, included in the bid used for dirtwork etc
120
Allowance
money set aside, typically for an item that has not yet been selected (or has a high chance of models changing)
121
Alternate
something as part of the bid, but separated to be able to determine if they want it based on the cost
122
Government projects use which fee base (2)?
Stipulated Lump Sum Fixed-fee + expenses (there may be a cap on expenses) these limit exposure and corruption
123
money owed to a firm is called___________
Accounts receivable
124
The value of the firm's stock, investments by shareholders, and the money the firm has made and kept is called the firms _______________
equity also called balance
125
Assets
what you own that can be easily turned to cash
126
Liabilities
What the firm owes current - due within 12 months long term - due past 12 months in future on the balance sheet
127
Equity
net worth of the firm; also called balance assets - liabilities = equity
128
Contract-based ethics
community agreed upon ethics BEING good as a GROUP
129
Character-based ethics
BEING good as an INDIVIDUAL
130
Duty-based ethics
DOING good as an INDIVIDUAL clear design intentions
131
Results-based ethics
DOING good as a GROUP being a good architect/firm
132
How do you file an ethical complaint against an architect?
National AIA goes through ethics council to enforce and interpret it there is a hearing officer (like court) penalty - can punish in AIA no cash penalty allowed
133
AIA Code of Ethics
can offer advisory input to National AIA Rules confidentiality cannot have counter suits
134
What are the most common sources of ethics complaints filed against architects?
other architects -usually over credit (project is too similar to my design - so you give broad credit to avoid complaint) homeowners -emotional attachment, unrealistic expectations - condos are especially bad
135
What is not factored in performing life cycle cost analysis?
Design Fees - this is a sunk cost/not going to change
136
Life Cycle Cost Analysis
cost to install + cost to maintain or operate works best if doing passive strategies works best for items that may cost more to put in, but less to maintain
137
Quality Management
project delivery and instruments of service = established office procedures checking documents before they go out the door sets up guidelines and metrics subcontractor/consultant management schedule man power allocation Eliminate waste in the process Treat your consultants as customers Utilize check sets Utilize scorecards
138
Efficiency Based Architecture Firms
cheaper and faster (may have an overseas cheap office) -more routine projects, repeatable elements, one market sector, more junior staff
139
Experience Based Architecture Firm
most common specialty likes schools, hospitals, automotive etc more complex, routine projects -selling points are knowledge and experience in a new firm, first hire should be admin assistant
140
Expertise Based Architecture Firm
Pritzker Prize winners, Passivhaus architects, architectural acousticians, deep knowledge or exceptional talent in their field, mostly senior staff, minimal to no junior staff often connected to universities
141
Fiduciary Duty
act in clients best interest/as an agent to the owner, but we are not financially responsible per the contract (standard of care) lawyers, doctors, accountants have fiduciary duty architects, car salesman, contractors do not
142
keeping someone on "retainer"
they will perform services on a regular basis for a fixed fee (lawyers)
143
Negotiated Proposal
Select the bottom 4 bids then negotiate which bid will also give best value
144
RFI
request for information
145
RFP
request for proposals (owner)
146
RFQ
Request for qualification - part of RFP or RFS
147
RFS
request for services - continuing and open ended work (retainer)
148
Per document AIA A101 (owner-architect agreement), if there is a conflict, the sequence for resolution is __________
mediation, then court contract has you pick arbitration or court claim must be made in writing
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Mediation
not binding mediators are more interested in splitting the difference even if the facts are not equal rules of evidence are relaxed compared to court claim must be made in writing
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Arbitration
not always cheaper than court, more strict than mediation rules of evidence are relaxed compared to court claim must be made in writing
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Court system
can be cheaper, lawyers prefer it strict rules for evidence, court is public record
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Initial Decision Maker
architect is this unless otherwise noted in contract A101 (owner-contractor agreement) resolves disagreements between owner and contractor this ends up putting more risk on architect (usually biased to side with owner)
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What if the owner isn't paying the architect?
architect can send letter giving 7 days to pay if contract is on hold for 90+ days, architect can cancel the contract
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AIA A series
between the owner and the contractor or contractor and subcontractor
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AIA B series
Between the owner and the architect
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AIA C Series
Between the architect and the architect's consultants AND IPD Consultants determine the work they will do and present it to the architect
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AIA D series
Miscellaneous Documents
158
AIA E series
Exhibits; electronic communications
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AIA G series
Administration and project management forms
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Cost of work includes ___________
contractor's materials, contractor's labor, contractor's profit, contractor's overhead (NOT reimbursables)
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Claims must happen before ________________
claims must be brought before 10 years - statute of limitations -if there is a claim, B101 (architect-owner) allows for liquidated damages
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Liquidated Damages
are agreed upon beforehand they cover the cost of the delay, usually per day
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Consequential Damages
can get messy - not typically used loss of profits due to not being able to operate the business
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Direct Damages
cost to repair defective work typically limited to amount of architectural fees
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What is the design height of a seated man measured from the floor to the mans eyes?
44" anthropometric proportions - used for ergonomics
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What is an overlay district?
part of zoning codes, may only be applicable for 1 zone type (in exchange for something beneficial to the community) - additional zoning requirements for a defined area (establish historic district etc) happens before developer gets involved Incentives can be things like density bonus for using PV panels 10% higher density = no parking lots required increase height maximums demands to get the incentives can be things like using PV panels housing about commercial provide low-income housing LEEd green roofs
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Planned Use Development (PUD)
developer negotiates with town to change zoning that will be beneficial city council approves
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Masterformat specs
classifies information by materials a standardized way of listing what is needed for a project concrete, metal, wood, etc more commonly used
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Uniformat Specs
lists things by system good for use with BIM stairs, structure, foundation etc
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Total Float Time (schedule)
how much slack is available for the total project by adding earliest and latest start/finish dates
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Free Float Time (schedule)
How long a construction activity can be delayed without delaying the next construction activity in the schedule
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Phased Bid
design build fast track designing and bidding simultaneously complex and challenging in practice can feel out of order
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Fast Track
common in commercial and institutional projects pose significant risks for architects takes more time to build when interest rates are low but when they are high, owners want to minimize interest costs architects must maintain a coherent design with minimal changes throughout
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Phased Construction
multiple projects (could be a campus or planning for additions) designed for expansion elements of uncertainty overall schedule must be worked out ahead of time with agreed on milestones (set realistic timeline) hours and fees for the architect bill reflects scope and accelerated schedule (arch gets more fees) more time spent coordinating design small with bigger design in mind
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Programming phase
adjacencies budget goals for the project research into building types NO design is done find out what we need, what questions to ask OWNERS RESPONSIBILITY (or add service) owner may higher programming consultant who has expertise
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Plat
typical to find in cities, small municipalities, modern
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Metes and Bounds
will get this in rural areas, very oldschool
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Lifecycle Costing / life cycle cost analysis
The evaluation of the cost of, for instance, boiler systems in a building from installation to replacement The cost to install, plus predicted costs to maintain economic analysis over the lifecycle use of a product construction is a one time decision Decision Automation -the computer can make a decision (purchasing printer ink when it senses its low) Routine Decisions - a low level person can decide (ordering papertowels) One-time Decision - what MEP equipment need to be in the building - these are long lasting and dont change - higher level decision making
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Lifecycle analysis
the analysis of embodied energy related to the creation, use, and death of a product Cradle to grave
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Future Facility Demand
how do we account for things that are going to change in the future if a program says 300-500 add students, plan for 300 OR 500, do not estimate between flaw of averages better to plan for a min and max than the middle
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how do architect consultants get paid?
they invoice the architect and get paid through the architect. the architect then invoices the owner for reimbursement plus profit. owner reimburses architect for invoice plus profit
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if a consultant specifies a product that is insufficient, who pays to fix it?
the architects insurance company (no contract between owner and consultants), then the consultants insurance reimburses the architects insurance
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Who works with a permitting consultant?
the owner - all things related to site
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Quality Management proprietary programs
six sigma -standardizes results and eliminates variation. probably not as relevant to architecture firms, more manufacturers ISO 9001 - Third party certification that a firm engages in mutually beneficial relationship. more for large, multi-office firms - lengthy process Lean Systems -philosophy for eliminating waste. How can we turn submittals around faster? Eliminate waste in processes Treat your consultants as customers Utilize check sheets Utilize scorecards Project audits
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Consequential damages
suing for unrealized profits i would have made if the project were not delayed. these are not in play in ANY AIA contracts
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Liquidated Damages
the owner penalizes the contractor per day of delay before the building opens, must be reasonable and previous value decided on this is in AIA 101 (contractor-owner) but FORBIDDEN in B101 (architect-owner) architect cannot be charged for late drawings
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Direct Damages
something not built correctly; faulty that causes damage. owner can sue architect or contractor for the cost of the repair
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Historical Cost (of valuing a building)
Assume it is worth the same as what you paid for it 15 years ago, no appreciation
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Cost approach (of valuing a building)
what it would cost to replace it if it burned down
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Sales Comparison (market) approach (of valuing a building)
worth what similar buildings sold for recently
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Unit pricing (of valuing a building)
cost or value multiplied by quantity of units (sf or apartment units, etc)
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Income Approach (of valuing a building)
income capitalization or residual income includes anticipation of future benefits. what would the prudent investor be willing to pay now for the right to receive the future income stream from leasing this office building to future tennants?
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AIA Code of Ethics
architects may not accept gifts intended to influence them architects may donate to their preferred candidates an architect may stamp drawings she drew or supervised an architect may make a public statement in support of his client if he discloses any financial relationship with the owner if an architect is fired for convenience, a second architect may pick up where the first left off but must give appropriate credit firms may not collude to set prices `
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Multiple of Direct Salary Expense (DSE) fee structure
pays by the hour. does not incentivize quick work
195
Percentage of construction cost fee structure
does not incentivize low construction cost
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Professional fee plus expense fee structure
"cost plus fixed fee" equivalent pays architect direct salary fee (at cost) hourly plus a lump sum for profit and overhead encourages quick work, flexible with inconsistent work needs
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Stipulated sum fee structure
fixed fee, doesn't work for changing projects. encourages quick work
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Additional Services fee structure
paid hourly for extra scope
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Supplemental services
FF&E
200
Betterment
owners betterment; improvement legal concept that discourage courts from fixing buildings to be better than they were supposed to be
201
Privity
no direct contract between architect and contractor so contractor cant sue the architect. the architect doesnt promise the contractor anything. the contractor could sue the owner and the owner could sue the architect
202
Waiver of consequential damages
cant sue for lost reputation or sales
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Subrogation
allows insurance companies to work out payments on insurers behalf A201 waives subrogation in construction, so if the building falls down and the owners insurance pays him, he cant go after the contractors insurance
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Agency
legally representiing/acting on behalf of another
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Fiduciary
committed to acting in your best financial interest
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Liquid Assets
quickly convert into cash includes invoices, work not yet billed but completed, if they OWN their space
207
Liquidity (quick ratio)
Current Liquid assets __________________ current liabilities goal above 1. that means we have more than we owe
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What are the levels of a corporation?
Stakeholders Directors Officers
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AIA B101 requires which insurances? And for what?
1) general liability-covers physical office space 2) professional liability - covers errors and omissions 3) workers' compensation Insurance - covers employee injuries or illness - medical care and lost wages 4) automobile liability _ covers company vehicles and personal cars used for business purposes 5) Employer's lability - covers employers IF they get sued for causing a workplace injury - settlements, court costs, legal fees
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Format types for specifications
Master format - classifies by material Uniformat - classifies by system
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Employment practice liability Insurance Intellectual property Insurance
Employment practice liability Insurance- Insurance to protect from wrongful termination Intellectual property Insurance - Insurance to cover claims based oncopyright/intellectual property infringement
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Tail Insurance
Covers the architect's projects after the architect's retirement A liability insurance for the projects the architect did prior to retirement which are still within the statute of limitations
213
What is the process to file an ethical complaint against an architect?
1 - file the complaint through AIA National 2- advisory board and chair are chosen 3 - pre-hearing, hearing, start, dam, defense, end, judgement * * confidential, no counter-claims, can't fine or enforce behave, but can admonish/suspend
214
Who are the most common ethics complaints?
Other architects Homeowners
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Does the architect have a fiduciary duty to the client: a legal obligation to act in the owners best financial interest?
No, architects do not serve as an owner's fiduciary
216
Are architects agents of the owner?
Not for the owner unless an additional agreement is signed - while walking the site the architect cannot speak for the owner when talking to the contractor
217
Common types of small business taxes
Federal and state income tax Self-employment tax Personal property tax
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How do you decide how much to charge a client?
Value Pricing - based on quality Effort Pricing - based on time spent (what the AREs assume in the exams) % Cost pricing - Based on percentage of total construction costs Fixed fee pricing - fixed cost to client typically derived based on triangulating estimates of the other three models
219
Risky Contract language
Warranty Guarantee Indemnify/Indemnification "Highest" Standard of Care As required/as necessary Hold Harmless Anything that passes liability to the architect
220
Base Salary
Total annual compensation
221
Contractor License Bond
A surety bond (insurance) that protects against contractors breaking construction laws
222
Municipal Bonds
loans made by investors to a government
223
Revenue Bonds
municipal bonds issued to finance facilities for revenue-producing public enterprises - like a stadium or toll bridge
224
Corporate Bonds
Private companies can also issue bonds to borrow money for building projects
225
Tort Claim
A claim made due to an injury Joint and several liability: if I get hurt due to your negligence and the negligence of others, I can sue you both. (Joint) If one of you goes out of business, the remaining person is responsible for the entire sum (several)
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S- Corporation
small or large company without public stocks - singly taxed personal property is protected from client lawsuits
227
Rules for unpaid interns
similar experience to education must benefit intern intern doesnt replace anyone and is closely monitored no advantage or some disadvantage to a firm no guarantee of job after intern and firm are explicit that there is no salary
228
Builder's risk insurance
Coverage of damages to the building during the course of construction designed to cover losses or damage to the property or construction materials occurring during the construction period on site
229
Default Scheduling (drawings)
Default scheduling is used to schedule building components that cover a majority of project conditions. This will reduce construction document sizes by allowing typical and repetitive items to be efficiently documented
230
Instructional Systems (drawings)
Instructional systems are drawings and notes that graphically coach the contractor to an understanding of the documentation. These systems define defaults while identifying and documenting the exceptions. This reduces extra sheets in a set of documents.
231
Lowest responsive bid
. Bidder followed the bidding rules and accounted for everything in the drawings / specs when bidding a price
232
Lowest responsible bidder
Bidder has the financial and technical where withal to build the project to a minimum quality, on time
233
Instruments of service
' Pretty much every thing the architect created for the project including CDs and specs - also site analysis, notes, study models, cost estimates, sketches - all creative work tangible or intangible
234
Architecture Billings index (A B I)
A running monthly indicator that is an economic indicator for construction activity. Over 50 means the financial outlook improved over the last month, under 50 means the financial outlook declined relative to last month, Regional, by department etc. Has predicted recessions
235
Is the architect entitled to compensation IF the building is not built?
Yes, contract is based on the budget for the cost of work, not the final cost of work
236
Taxable income
Wages, salaries, and bonuses are considerable taxable income. Many benefits like child care and contributions employees make to health insurance plans may not be subject to taxes
237
Responsible control
As a licensed architect, you can stamp the work IF you have achieved "responsible control" over a drawing set including specs, reports, etc. You have to know enough to be consistent with what other architects in your area are doing for similar projects ( standard of care)
238
Can you, as the architect, stamp the work of consultants?
You may stamp the work of a licensed consultant 'IF you have "reviewed it, coordinated its preparation, or intend to be responsible for its adequacy"
239
Is it ethical for an architect with no knowledge, background, or experience in oil refinery design to take responsibility for the architecture of an all refinery.?
Yes if they engage relevant consultants to guide them or seek the appropriate education or training on their own
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What is payroll burden?
(Also called labor burden) is the cost to your firm for employing you not including your salary Typically expressed as a percentage of salaries 10% means for every $100 of salary, there is an extra $10 of fees
241
Supplemental services vs additional services
Supplemental: extras that can be defined beforehand and valued in the contract Additional: extra requirements that will arise during construction and are not easily predicted or included in the contract (like extra site visits)
242
Net multiplier
The net multiplier is the ration of net operating revenue (nor) to total direct labor. The measure of return on every dollar of direct labor.
243
Backlog
Current project revenue not yet earned or invoiced (will affect the firm's projected revenue)