Architects’ Fees.

Progress, Volume XVI, Issue 9, 1 May 1921, Page 201

Architects’ Fees.

A case of very great importance to architects and their clients has recently occupied the attention of the Magistrate’s Court at Wanganui, when a member of the Institute, practising in Wanganui, sued a client for £(O2 10s., being 2\ per cent, on the plaintiff’s estimated cost of a building for which he had prepared plans and specifications. The defendant tendered Z3O in discharge of his obligations to his architect.

The following is the Magistrate’s summing-up and verdict:—

In giving judgment for the plaintiff for the full amount claimed, His Worship said that there was a contract between the parties to draw plans and specifications for a certain building. The contract fee of per cent, of the price of the building was fixed as the fee to the architect for the whole of his work. Alterations were made in the plans from time to time, and eventually the plans were approved. Then completion of the building contract became impossible, owing to the refusal of the Board of Trade to grant a permit to build during the shortage of building material. The parties agreed that something should be paid as a quantum meruit, as the plans and specifications could now be used by the defendant. The architect, on his departure from Wanganui, sent in his bill for £62 I os. He (Mr. Helm) said his estimate of the cost of the building was a fair one, that the fee of 2\ per cent, on that cost was reasonable, and that his method of assessing his fee was reason-

able. Evidence was given by Mr. Helm (the plaintiff), Mr. Ford (architect), and Mr. Patterson (builder), to the effect that the building would cost from £2,500 to £2,700. Mr. Wansborough, giving evidence for the defendant, estimated that it might be built for £l5O less. This led His Worship to believe that £2,500 was a reasonable estimate of the cost. As to the assessing of the fee, His Worship said he thought that to fix a lump sum was not the best manner of deciding what an architect’s fee should be. The defendant had offered £3O, but was not able to say how he decided that £3O was a reasonable fee. His Worship considered that the best method was to charge a percentage, as was usually done by architects when charging their clients fior their work. Even though this might appear to have been a simple building, professional skill and care were required, and the architect was responsible for his work. It was admitted that 6\ per cent, of the cost was to be the fee for the whole of the architect’s work, and the Court had to decide what proportion of that work had been done. The mam work still to be done was the supervision. If per cent, were allowed for the supervision, even this seemed a high proportion. However, the plaintiff had produced the scale, which showed what architects usually ask, viz., 2| per cent, for the work that had already been done. He considered this charge was not unreasonable, and accordingly gave judgment for the plaintiff for the full amount claimed, together with costs amounting to £l4 is.

In commenting upon this case it is interesting to note that by the evidence the only “ proof of any agreement as to cost or estimated cost was the production by the plaintiff of the application to the Board of Trade, signed by the defendant , and ins own admission as to a verbal agreement regarding percentage charges. The Board of Trade'application was quite an accidental proof of “evidence of agreement.” In cross-examination the architect admitted that he had kept no diary, h ailing any signed document setting forth any agreement as between architect and client, an entry in the former’s diary, regularly kept for the purpose, made on the date of the verbal agreement and setting forth the terms thereof, would have been accepted as prima facie evidence of an agreement as to the terms of employment. This is a matter which practitioners might well take to heart and consider seriously whether or not they have (should it be needed) any legal evidence of their employment by an owner. Many architects labour under the belief that an instruction (usually verbal only) carries with it certain fees. Nothing of the kind. It must first be proved that the instruction was received, and secondly what were its exact terms. It is considered necessary to have an agreement as between builder and client, why not between architect and client? The American Institute of Architects (a most businesslike institution) advocates an “agreement

between the owner and the architect,” and issues to its members blank forms of such agreements. Until we can introduce this form into New Zealand let us at least do something towards it, in our own interests, by establishing some reliable record of our agreements even if it is only an entry in a diary. While it is gratifying to read the Magistrate’s decision in the case quoted, it should act as a warning to practitioners to place their relations with their clients upon a proper basis. There is one other point of importance which arises out of just such cases as this one, and it is this; practitioners should be careful not to “ contract ” to design a building to cost, or not to exceed, a certain figure, as by so doing they are entering into a contract which, if not carried out strictly to the letter, will prevent them from recovering any fees at all for that particular work.