Don’t Be a Victim of the “Fiduciary” Label

The AIA Trust risk report on the crucial legal & professional considerations for architects regarding fiduciary duty offers no surprise about lawsuits founded upon professional malpractice or the breach of a professional services agreement against design professionals. However, concerns may arise when a design professional is also sued for the breach of a fiduciary duty.

When a design professional is charged with a breach of fiduciary duty, it faces heightened litigation expenses, a risk of being taken beyond its errors and omissions insurance protection, the potential for a punitive damages award, and community reputation issues. In all probability, the designer’s problems are a result of not adhering to relatively simple contract drafting precautions. The designer’s signing whatever draft written agreement the client presents, without carefully evaluating and possibly modifying it, is fraught with legal peril.

The architect deemed a “fiduciary” probably failed to protect him or herself from contractual overreaching. This AIA Trust report outlines litigation and insurance coverage issues, as well as key strategies to enable members to avoid the “fiduciary” label, especially at the contracting stage.