AIA, ConsensusDocs and EJCDC standard form contracts

Most construction contracts are not drafted from scratch. They start from standard forms prepared by industry bodies, then are modified by supplementary conditions written for the project. Standard forms save time, reflect decades of experience, allocate risk in ways the industry understands, and allow courts to develop consistent interpretations. They also have a weakness: because everyone has seen them, people stop reading them, and the supplementary conditions that change them are where many disputes begin. This lesson introduces the main families of forms, the structure of a typical general conditions document, and how to review amendments.

Why standard forms exist

Standard forms solve several problems at once. They reduce the cost of drafting and reviewing contracts on every project. They allocate risks in a balanced way that has been negotiated between owners, designers, contractors and sometimes sureties and insurers. They coordinate the documents: the general conditions, the subcontract and the insurance requirements are written to fit together. And they are known to banks, sureties and courts, which reduces uncertainty.

In the United States, three main families compete. The American Institute of Architects (AIA) publishes the most widely used forms, organized in series around the A201 General Conditions. ConsensusDocs, developed by a coalition of contractor, owner, subcontractor and surety groups led by the Associated General Contractors, publishes forms intended to be more balanced between owner and contractor. The Engineers Joint Contract Documents Committee (EJCDC) publishes forms used mainly for engineered infrastructure such as water and wastewater projects. The Design-Build Institute of America (DBIA) publishes design-build forms. Federal agencies do not use these forms; they use FAR clauses incorporated into each contract.

Structure of a contract

A typical contract package has several layers, read together.

• The agreement: names the parties, the work, the contract price, the contract time and the list of contract documents.
• The general conditions: the standard rules on administration, payment, changes, delays, insurance, termination and disputes.
• Supplementary conditions: project-specific amendments to the general conditions, sometimes many pages long.
• Division 01 of the specifications: general requirements such as submittals, scheduling, site facilities and closeout.
• Technical specifications and drawings: what is to be built.
• Addenda issued during bidding, and change orders after award.

Inside AIA A201-2017

A201-2017 is organized in fifteen articles. The ones most used on site are these.

• Article 4, the architect: administers the contract, interprets the documents, reviews submittals and certifies payment.
• Article 3, the contractor: supervises the work, provides the schedule under § 3.10, and warrants the work under § 3.5.
• Article 9, payments and completion: applications for payment, certificates, retainage, substantial completion and final payment.
• Article 7, changes in the work: change orders, construction change directives and minor changes; Article 8, time, including delays and extensions under § 8.3.
• Article 14, termination or suspension: for cause by either party, and for the owner's convenience under § 14.4.
• Article 15, claims and disputes: the 21-day claim notice under § 15.1.2, the initial decision maker, mediation and, if selected, arbitration.
• Articles 10 to 13: protection of persons and property, insurance and bonds, uncovering and correction of work including the one-year correction period under § 12.2.2, and miscellaneous provisions such as the mutual waiver of consequential damages in § 15.1.7.

AIA revises its forms on a ten-year cycle, and the 2017 editions changed insurance provisions, moved insurance and bond terms into exhibits, and adjusted the claims process from the 2007 editions. A new edition is expected around 2027, so check which edition a project uses. ConsensusDocs revises its forms more often.

Supplementary conditions and amendments

Owners rarely use standard forms unchanged. Supplementary conditions add project requirements, adjust risk and sometimes transfer risks that the standard form deliberately leaves with the owner. Common amendments include:

• Shifting the risk of unknown site conditions to the contractor.
• Shortening notice periods for claims, or making notice a condition precedent to any entitlement.
• Adding broad indemnities, waivers of claims and limits on delay damages.
• Extending warranty periods or adding performance guarantees.
• Changing payment terms, holdback release or retainage.
• Adding owner rights to terminate for convenience.

AIA forms are licensed and include a notice that changes must be shown, and AIA's software tracks deletions and additions. Owners often add a separate rider of amendments. Courts interpret amendments according to their words, and the more a form is amended, the less earlier case law on the unamended form helps.

Subcontracts and flow-down

A subcontract must fit the prime contract. Most subcontract forms include a flow-down clause binding the subcontractor to the general contractor as the general contractor is bound to the owner, for the subcontractor's part of the work. Flow-down protects the general contractor from being caught between an owner's demands and a subcontractor's narrower obligations, but it can also impose on subcontractors terms they never saw. A subcontractor should always ask for the prime contract, or at least the parts that flow down.

AIA A401-2017 and ConsensusDocs 750 are both drafted to coordinate with the prime contract forms. Subcontractors should pay special attention to pay-if-paid and pay-when-paid clauses, which states treat differently (Lesson 6), set-off rights, notice periods that are shorter than those in the prime contract, and indemnities, which many states limit by anti-indemnity statutes.

Choosing a form

The right form depends on the delivery method and on how price risk is shared.

• Stipulated price or lump sum: the contractor takes the risk of cost overruns on a defined scope.
• Cost plus a fee, with or without a guaranteed maximum price: the owner pays actual costs, and takes more of the risk, in exchange for flexibility and transparency.
• Unit price: payment by measured quantities, suited to civil work where quantities are uncertain.
• Construction management and design-build: different relationships with the designers and different allocation of design risk, covered in CON-340.

The contract summary at project start-up

The single most effective legal habit for a construction manager is to prepare a contract summary at the start of every project. A good summary fits on two or three pages and is shared with the site team, the project accountant and the estimator who will price changes. It turns a contract package of several hundred pages into the handful of terms that people need to act on every week.

• Parties, addresses for notices and the people authorized to give instructions and sign changes.
• Contract price, pricing method, allowances, unit prices and the markups allowed on changes.
• Contract time, milestones, liquidated damages, and the procedure and notice periods for time extensions.
• Payment terms: application dates, holdback or retainage, stored materials and the documents needed with each application.
• Requirements for notices of claims, differing site conditions, delays and defects, with each period stated in days.
• Insurance and bonding requirements, warranties and correction periods, and closeout documents.
• Dispute resolution steps and any unusual or onerous amendments flagged for attention.

The summary is a working tool, not a legal opinion. It should cite the clause numbers so that anyone can go back to the source, and it should be updated whenever a change order or amendment alters a term. Many disputes that end in court would never have arisen if the people on site had known, from the first week, that the contract required written notice within seven days or that only the owner's director of capital projects could sign a change.