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Don't include Architects' Institute in dispute resolution clauses, says NZIA

11 July 2019

Drafting a property dispute resolution clause which provides for an expert appointed by the New Zealand Institute of Architects (NZIA) is not acceptable, the Institute says.

The NZIA reports that it has been contacted twice in the last month about clauses which have been drafted by lawyers into a sale and purchase agreement and a lease agreement respectively.

Under the dispute resolution clauses in these agreements, the NZIA is required to appoint an architect as expert, and the NZIA President is required to appoint an independent expert.

The NZIA says this has been done without its knowledge or consent and places it in an untenable position. It notes that the NZIA, its President, and its architect members generally, are not authorised nor have the expertise (and insurance) to provide these services.

The NZIA believes that any such clauses must fail for impossibility. The NZIA, its President, or its architect members cannot be obligated to provide services outside their remit or expertise.

The NZIA further notes that its own forms of consultancy agreements and construction contracts do not require the NZIA to have any role in the dispute resolution process, but allow for nomination of AMINZ or the Building Dispute Tribunal by the parties prior to executing the contract.

The NZIA has asked the New Zealand Law Society to generally notify legal practitioners that this type of clause is not acceptable and ineffective.

Last updated on the 11th July 2019