Guide to Using the RIBA Professional Services Contracts 2018 - Other - Page 40
Contract terms
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should take legal advice when arranging for the preparation of the documents and
check with their professional indemnity insurers.
It is recommended that an agreement to novate is put in writing. However, consent to
novation does not have to be given in writing. Consent can be given verbally, and it
can also be inferred by conduct. In practice, written consent would normally be given.
In any event, the new Contract following novation would effectively amount to written
consent. Following novation, the original Contract will be terminated and replaced by
a new Contract between the Architect/Consultant and the Contractor or new Client.
Draft novation clauses (as Standard PSC clause 4.7)
Whether a standard or bespoke Novation Agreement is used will depend on
the preference of the parties but should incorporate the principles set out in the
following template clauses for which legal advice should be sought:
4.7.1
the Client hereby agrees to release and discharge the Architect/Consultant
from further performance of its obligations under the Architect/Consultant’s
appointment and from all duties, liabilities, claims and demands whatsoever,
whether under the Contract or otherwise and whether arising prior to, on
or subsequent to the date of the novation agreement. (Where the Architect/
Consultant has provided a Collateral Warranty or granted third party rights to
the Client pursuant to clause 4.4, this wording shall be prefaced by: ‘Without
prejudice to any other rights or remedies the Client may have under a
Collateral Warranty or Third Party Rights Schedule pursuant to clause 4.4’)
4.7.2
the Client and the Architect/Consultant and the Contractor hereby agree
that the Architect/Consultant’s appointment shall be deemed to have
been made with the Contractor in place of the Client from the outset
for all purposes and in respect of all rights, benefits, liabilities and duties
thereunder, whether arising prior to, on or subsequent to the date of
the novation agreement, including, without restriction, any limitation or
exclusion of liability therein so that the Architect/Consultant shall have no
greater or longer liability to the Contractor hereunder than it would have
owed to the Client under the Architect/Consultant’s appointment. The
Architect/Consultant agrees that it shall not assert that the Contractor has
suffered no loss solely because a breach of the Architect/Consultant’s
appointment occurred prior to the date of the novation agreement but
the parties acknowledge that the Architect/Consultant in carrying out its
obligations under the Architect/Consultant’s appointment prior to the date
of the novation agreement was acting for the benefit of and solely on the
instructions of the Client
4.7.3
the Architect/Consultant hereby agrees to release and discharge the Client
from further performance of the Architect/Consultant’s appointment and
all duties, liabilities, claims and demands whatsoever, whether arising
prior to, on or subsequent to the date of the novation agreement and the
Architect/Consultant accepts the Contractor in place of the Client under the
Architect/Consultant’s appointment
4.7.4
the Contractor agrees to perform all of the duties and accepts all the
obligations of the Client under the Architect/Consultant’s appointment and
to be bound by all its terms and conditions in every way as if it had been
named as a party to the Architect/Consultant’s appointment in place of the
Client from the outset.
It is often assumed that the Architect/Consultant would want to continue with the
next stage of the project but there is no guarantee that mutually agreeable terms
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