Inside AGC — November/December 2006

Services & Products: AGC Contracts: Industry Tested, Comprehensive & Fair

AGC's contract documents are the industry's choice

AGC delivers documents with the latest technology. For more information, visit www.agc.org/docubuilder

You probably know that AGC is the oldest and largest construction association. But you may not realize that AGC's original 1918 bylaws called for standard contracts that balance the "interests of owners, general contractors, subcontractors, manufacturers and dealers."

"AGC's Contract Documents Committee has created a process that uses input from owners, general contractors and specialty contractors to create the most fair and balanced documents in the construction industry," says AGC CEO Stephen E. Sandherr.

"Our company prefers the AGC contract documents. They are the most equitable and balanced documents in the industry," says Jim Fergusson of Fergusson & Associates Inc., Anchorage. "AGC contracts and the DocuBuilder software strengthen relationships, reduce claims and disputes, allocate risks fairly for everyone and are simple and cost effective to use."

Fair Contracts

AGC contracts start with the premise that all parties share the same goals-to build outstanding projects that benefit everyone. The contracts strengthen direct communications and collaboration between an owner and general contractor and set a positive tone. AGC jointly drafts them with the Private Industry Advisory Council, a diverse group of the top 100 owners.

AGC also actively solicits outside perspectives and takes a real-world approach in determining industry best practices during the drafting process.

"AGC goes to extraordinary lengths to work with leading owners and other construction associations so that contracts are a collaborative effort," says Bill Ernstrom of Alberici Group Inc., St. Louis, and vice-chair of PIAC and the AGC Contract Documents Committee.

Other innovative aspects of AGC contracts include placing the owner in the role of primary decision-maker instead of mandating that the architect function as an initial disputes mediator. The owner decides who should handle disputes initially and the documents allow parties in contract negotiations to decide their own dispute resolution methods.

"Owners are willing to sign AGC's contract documents because of their fair terms and conditions," says Paul Hoffman of Hoffman Construction LLC, Appleton, Wis., and chair of the AGC Contract Documents Committee. "AGC contracts cover the contractor's responsibilities in safety, cleanup, delay and damage to owners' existing adjacent property more thoroughly than any other standard form contracts."

The Future

AGC contracts incorporate new technology to make contract writing even easier. The new edition of DocuBuilder 5.0™, AGC's electronic document software application, offers all 100 of its standard-form contract documents either through a subscription service or on a contract-by-contract basis via software download. Users save time by entering project-specific information, which is then flowed throughout the contract, sub-agreements and forms.

AGC will continue to collaborate with a diverse group of construction associations to achieve consensus on industry best practices and revolutionize standard construction contracts. These diverse associations bring expertise to the process to create a AGC's comprehensive catalogue of contracts, including general conditions, construction management-at-risk, design-build, subcontract, bond forms, etc. as a representation of the industry's best practices.

AGC's time-tested contract documents are the choice of owners, industry leaders and construction associations. As the industry advances, so too have AGC's documents, shaping projects into the future.