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ConsensusDOCS v. AIA - Contractor Rights to Project Financing Information

ConsensusDOCS are the only standard contracts that give Contractors the contractual right to project financing information throughout the life of the project - not just at the beginning. The ConsensusDOCS 200, Standard Agreement and General Conditions Between Owner and Contractor, expressly states that "[p]rior to commencement of the Work and thereafter at the written request of the Contractor, the Owner shall provide the Contractor with evidence of Project financing.  Evidence of such financing shall be a condition precedent to the Contractor's commencing or continuing the Work.  The Contractor shall be notified prior to any material change in Project financing." In sharp contrast, the American Institute of Architects' A201-2007, General Conditions of the Contract for Construction, restrict the Contractor's access to owner financial information after work commences and expressly states that a Contractor may request such information only "if (1) the Owner fails to make payments to the Contractor as the Contract Documents require; (2) a change in the Work materially changes the Contract Sum; or (3) the Contractor identifies in writing a reasonable concern regarding the Owner's ability to make payment when due."  These restrictive conditions are subject to interpretation and can lead to expensive and unnecessary disputes. The ConsensusDOCS 290, Guidelines for Obtaining Owner Financial Information, and the related Financial Questionnaire 290.1, provide an easy and direct way for contractors to quickly determine the financial viability of projects.  The 290 expressly highlights, "[i]n any contractual venture, each Party has a legitimate interest and responsibility in ascertaining whether the other Party is fully capable of performing all of its contractual obligations...The proven ability to pay is just as important as the proven ability to perform."  Contractors value ConsensusDOCS-based projects because they clearly possess the contractual right to request and obtain financial viability information.  The 290 provides a reasonable approach to requesting such sensitive but critical financial information and is endorsed by national owner groups including COAA, CURT and NASFA. For a free excerpted sample, please visit www.AGC.org/Bookstore.  AGC members receive a 20% discount on all ConsensusDOCS products.