• Delimitation of Budget with Client to Be Conducted At Early Stage of Planning
  • May 3, 2013
  • Law Firm: GRP Rainer LLP - Office
  • The planning process would potentially be useless and a claim laid by the architect for remuneration could not be successful, if the specified budget framework is exceeded by the architect at a later date.

    GRP Rainer Lawyers and Tax Advisors, Cologne, Berlin, Bonn, Düsseldorf, Essen, Frankfurt, Hamburg, Hanover, Munich, Stuttgart, Bremen, Nuremberg and London www.grprainer.com/en explain: An architect has to delimit the economic framework for a construction project and consider the budget plans of the client with regards to the basic evaluation. In a judgement dated 21 March 2013 (Ref.no.: VII ZR 230/11), the Federal Court of Justice declared that, within the framework of the basic evaluation, an architect has to delimit the economic framework for a construction project with the client and that the client’s budget plans for the planning of the construction project have to be considered.

    The Court was asked to rule in a case in which a contractor had hired an architect to obtain the planning approval for a family home. The client claimed that the plan had become useless to him, as during the execution of the project the architect’s plan was not carried out. The architect objected to this, requesting payment of the fees for the planning work and filing an action.

    If the architect does not disagree with the budget plans brought forward by the client, they should, in any case be able to determine the planning framework and even become part of the contract. Now the Federal Court of Justice stated that as early as during the basic evaluation process an architect is in principle obligated to delimit the economic framework for a project with the client and to consider the client’s budget plans.

    An architect is faced with many responsibilities which not only apply with regard to technical issues, but also with regard to all obvious legal matters.

    If there were doubts concerning the economic framework, the architect would have to inform the client about it. Even the budget plans of the client shall be binding when there is not a delimited cap on the construction costs, but rather approximate construction costs that have been determined and on the basis of which the economic framework is to be determined.