New AIA Subcontract Adopted
Kegler Brown Construction Newsletter November 1, 2007
The American Institute of Architects ("AIA") has adopted its 1997 edition Subcontract (A 401) which, as in the past, is endorsed by the American Subcontractors Association ("ASA") and the Associated Specialty Contractors, Inc. ("ASC"), but not endorsed by the Associated General Contractors ("AGC").
Some of the more noteworthy 1997 changes are as follows:
- The Contractor within 30 days after receipt of a written request (or earlier if required by law) is to provide Subcontractor with all information necessary to give notice or perfect mechanic's lien rights (3.2.5).
- Mediation is required before either party can commence arbitration or litigation (6.1.1).
- It contains a "watered down" trust-type provision requiring both the contractor and subcontractor to hold monies for the benefit of their respective creditors on that project (11.1).
- Both Contractor and Subcontractor waive consequential damages against the other (15.4).
This 1997 edition of the A401 Subcontract should remain in use for the next ten years.