OCTOBER 2020

PROFESIONAL PRACTICE & THE JBC

SACAP PROFESIONAL EXAMINATION

PAPER 1
PAPER 1 – PPE EXAM CONTENT & JBCC ADMINISTRATION

CONTENTS

1. PPE PAPER 1 - SYLIBUS

2. INTRODUCTION
3. THE ARCHITECTURAL PROFESSION ACT (44 OF 2000)
4. FUNCTIONS OF SACAP
5. THE CODE OF PROFESIONAL CONDUCT
6. CONTINUING PROFESSIONAL DEVELOPMENT - CPD
7. VOLUNTARY ASSOCIATIONS
8. LAWS OF CONTRACT + AGENCY AND PROPERTY LAW
9. TYPES OF BUSINESS ENTITIES
10. THE BUSINESS PLAN
11. BUSINESS ADMINISTRATION
12. HUMAN RESOURCE MANAGEMENT
13. FINANCIAL MANAGEMENT
14. RISK MANAGEMENT + INSURANCE
15. SCOPE OF PROFESIONAL SERVICES
16. FEES FOR PROFESIONAL SERVICES
17. PROFESSIONAL RESPONSIBILITIES
18. PROFESSIONAL SERVICE AGREEMENTS
19. THE CLIENT + PROFESSIONAL TEAM

pg. 1
SYLIBUS - PPE PAPER 1

1. The Architectural Professional as practitioner:

1.1. The Architectural Profession Act No 44 of 2000.
1.1.1. General provisions of the Act.
1.1.2. Categories of registration: Requirements for registration.
1.1.3. Framework for the Professional Fees Guideline.
1.1.4 Renewal of Registration (CPD Conditions).

1.2. Voluntary Associations, their form and function.

1.3. The Architectural Professional and their office.
1.3.1. Forms of practice: sole practitioner, partnership, company, multi-disciplinary – legal nature of each and
the advantages and disadvantages of each.
1.3.2. Statutory requirements for each form of practice i.e. Department of Labour, CIPC etc.
1.3.3. The Architectural Professional and his employees – the legal nature of the employer/employee
relationship.
1.3.4. Statutory requirements regarding employees.
1.3.5. Risks, responsibilities, and liabilities arising from the conduct of a practice – insurances.
1.3.6. Taxation – Income Tax, PAYE, VAT etc.
1.4. The Architectural Professional and their client.
1.4.1. Professional Code of Conduct.
1.4.2. The Architectural Professional as agent – the legal nature of agency.
1.4.3. Recommended forms of architectural professional service agreements.
1.4.4. Professional fees.
1.4.5. Preparing and presenting accounts, invoices and statements.
1.5. The Architectural Profession and the professional team.
1.5.1. The other members of the professional team – project manager, quantity surveyors, engineers, town
planners, and other related professions – their respective functions and inter-professional relationships.
1.5.2. Recommended forms of inter- and intra-professional agreements i.e. joint venture and collaborative
agreements.

2. The architectural service to the client:

2.1. Work stages in accordance with SACAP's Professional Fees guideline
2.2. Additional services
2.3. Performing work for deferred remuneration.
2.4. National Building Regulations, including but not limited to the SANS 10400 suite of standards legislative
constraints on the design of a project: e.g. Title deed conditions, town planning, energy efficiency, green
building council rating tools etc.
2.5. Construction Regulations 2014.
2.6. Securing statutory approval of design proposals – securing waivers of statutory requirements.

pg. 2
2.7. Preparing construction and tender documentation: drawings and specifications.
2.8. Procuring a building contractor to carry out the project.
2.9. Administering the building contract on behalf of the client.
2.10. Limits of responsibility of the Architectural Professional
2.11. Professional Indemnity.
2.12. Copyrights and Intellectual Property of the Architectural Professional's work.
2.13. Termination of the Architectural Professionals services.

pg. 3
INTRODUCTION
Historical Context

 Running a practice as a BUSINESS is CRITICAL to success.

 SAIA & SAIAT are primary VOLUNTARY ASSOCIATIONS that support the professional architects and
architectural technologists.
 NB TEST - It is Compulsory to REGISTER with SACAP in order to practice as an architectural professional.

Legislative context
 The NEW CONSTITUTION of South Africa was “PROMULGATED” (made public or published) in 1996 and is
widely acknowledged as the most progressive document of its kind.
 Our constitution provides a Bill Of Rights which outlines the civil, political, economic, social and cultural
human rights of the people of South Africa.
 It recognises the basic human rights of all individuals, the needs of groups, the affluent and the poor.
 It addresses prejudice and freedom of expression
 And it sets out to protect cultural values and the natural environment.

In 2000, The CIDB Construction Industry Development Board Act was promulgated
 Provides for the establishment of the Construction Industry Development Board.
 And for the implementation of an INTERGRATED STRATAGY for the reconstruction, growth, and
development of the construction industry.
 Also, in 2000 the COUNCIL FOR THE BUILD ENVIRONMENT ACT – CBE, was introduced. An overarching
council for the professions practicing in the built environment.
 Subsequent related acts followed: & constituent members
o ARCHITECTURAL PROFESSION ACT (44 of 2000)
o Engineering Profession Act (46 of 2000)
o Landscaping Profession Act (45 of 2000)
o Project and Construction Management Profession Act (48 of 2000)
o Quantity Surveying Profession Act (49 of 2000)

pg. 4
THE ARCHITECTURAL PROFESSION ACT ( 44 OF 2000)

 NB TEST - The architectural profession is founded on two pillars of legislation:

o The architectural profession Act (44 of 2000)
o National Building Regulations and building standards Act (103 of 1977)
 Established the South African Council for the Architectural profession – SACAP – As a Juristic person.
 Provides for the REGISTRATION of:
o Professional Architects,
o Senior architectural technologists,
o Architectural Technologists
o Architectural draughtspersons
 Previous legislation only delt with architects.
 We are the only country in the world where on JURISTIC (legal) entity regulates all categories within the
architectural profession.

 THE NATIONAL BUILDING REGULATIONS AND BUILDING STANDARDS OF ACT (103 OF 1977)
o NBR – National building regulations
o This provides for the promotion of uniformity in the law relating to the erection of buildings in the
areas of jurisdiction of local authorities and for the prescribing of building standards.
o An architectural Professional must Affix his/her profession and registration to any specification,
document or diagram submitted to a local or provincial authority.
 i.e. work must DEEM TO SATISFY (in accordance with SANS 10400)
 or – Rational Design – by a competent person involving a process of reasoning & calculation

 NB TEST - Functions of the Architectural Professions Act:

o To provide for the establishment of a Juristic person to be known as SOUTH AFRICAN COUNCIL
FOR THE ARCHITECTURAL PROFESSION (SACAP).
o To provide for the registration of professionals, candidates, and specified categories in the
Architectural Profession.
o To provide for the regulation of relationships between the SACAP and COUNCIL FOR THE BUILT
ENVIRONMNENT (CBE)
o To provide for matters connected therewith.

 Further forms of legislative relevant to the Architectural Profession

o Local authority / municipal frameworks
o Occupational health and safety act
o Spatial planning and land use management act (SPLUMA)
o Basic conditions of employment act
o Value-added tac Act
o Income Tax Act.

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FUNCTIONS OF SACAP AND THE CODE OF PROFESIONAL CONDUCT

 To provide for the establishment of a Juristic person to be known as SOUTH AFRICAN COUNCIL FOR THE
ARCHITECTURAL PROFESSION (SACAP).
 The primary role of SACAP is to protect the Public.
 NB TEST - In the eyes of SACAP – and as an architectural Professional – the only competence you have is
your: REGISTERED COMPETENCE

NB TEST - 9 PRIMARY FUNCTIONS OF SACAP

1. Protect the Public
2. Register professionals that are men=members of the architectural profession and maintain this register.
3. Supervise and accredit South African Education in South Africa.
4. To Prepare and publish the code of professional Conduct and to prosecute offenders of this code.
5. Develop and update a recommended and Tarif of fees.
6. Liaise with the Council of the built environment and all its constituent members.
7. Develop and implement the identification of work process, currently under view (What professions can
develop what typologies of architecture). (Code of conduct Rule 2)
8. Amend Legislation if necessary.
9. Ensure that the public and registered persons are kept informed of developments within the sector (by
facilitating and auditing the continuous professional development (CPD) process).

SACAP CATAGORIES OF REGISTRATION – 9 CATAGORIES

PROFESIONAL
1. ARCHITECT
2. SENIOR ARCHITECTURAL TECHNOLOGIST
3. ARCHITECTURAL TECHNOLOGIST
4. ARCHITECTURAL DRAFTSPERSONS

CANDIDATE
5. ARCHITECT
6. SENIOR ARCHITECTURAL TECHNOLOGIST
7. ARCHITECTURAL TECHNOLOGIST
8. ARCHITECTURAL DRAFTSPERSONS

9. SPECIFIED CATAGORIES (Any other categories that might be required as per SACAP)

pg. 6
THE CODE OF PROFESIONAL CONDUCT
 Code of Professional conduct covered in (Board Notice 154 of 2009)
 Contains a set of Rules by which all registered professionals must adhere.
 NB TEST - The most important obligation is: In carrying out professional work a registered person is
expected to act COMPETELY and with INTEGRITY.

The Code of Conduct is a set of 6 RULES:

1. UNPROFESSIONAL CONDUCT
o Refrain from conduct that SACAP would deem to be detrimental to the esteem, dignity and / or
professionalism of the architectural profession.
2. TECHNICAL COMPETENCE AND PROFESSIONAL WORK.
o Only undertake architectural work that is identified in that category in which you are registered.
o You must engage in continual professional development to ensure you keep up to date with
developments.
3. PROMOTION OF SERVICES
o Promote your professional services in a truthful and responsible manner.
o Only take credit for your own work and declare any business interests where there may be a conflict.
4. PROFESSIONAL RESPONSIBILITIES
o Act in a sense of professionalism in preforming all your duties with due skill, competency, and
integrity.
o Clearly set out in writing the terms of the appointment, including the scope, services, fees payable,
budget, termination agreements, professional indemnity, and dispute resolutions.
o Only sign work that was prepared Bona Fide or under direct supervision.
o NB TEST - Consider these items when considering a letter of offer
1. Scope of the project
2. Scope of your services
3. Limits to responsibilities
4. Fees: How calculated + payable
5. Budget or cost limit
6. Provisions for termination
7. Details for PI insurances
8. Provision for dispute resolution
5. ESTABLISHMENT OF AN ARCHITECTURAL PROCTICE AND CARRYING ON OF A BUSINESS
o Ensure that SACAP is aware of all the details of your architectural practice.
o Keep your stationary (letterheads, etc.) up to date and display what SACAP requires.
6. International Work
o If you obtain work outside South Africa, be sure to behave in accordance with the standards and
professional conduct of the country concerned.

pg. 7
CONTINUING PROFESSIONAL DEVELOPMENT - CPD
 NB TEST - Continuous professional development = The process of TRACKING + DOCUMENTING the skills
knowledge + experience that you gain formally + informally as you work.
 NB TEST - Purpose = Point to the need for life-long learning to maintain, enhance + increase the Knowledge +
skills necessary for the proper execution of professional duties.
 NB TEST – CPD period – your professional registration with SACAP Expires every 5 years. Only if you comply
with the CPD rules will you be able to renew your registration.
 SACAP introduced CPD: A mechanism to determine the conditions for Renewal of registration of
professionals.
 Approved CPD provider = a voluntary association or accredited education institution, recognised by SACAP
for the purpose of offering CATEGORY 1 development activities
 TIP - Of the 5 CPD credits you require each year, you can get 2 for working – one you get for being a member
of a VA, serving on a comity you will get an extra credit, then you require only 1 in category 1 to have
enough credits.

The reason for CDP

o Increasing complexity of construction
o Rapid developments in information technology
o Need for the improved performance
o Ongoing development of materials, techniques + systems
o Continually changing legislative and practice frameworks
o Growing environmental imperatives.

CPD CATEGORIES
1. DEVELOPMENT ACTIVITIES
 Lectures, courses, seminars, conferences, workshops
2. WORK BASED ACTIVITIES
 Architectural work, lecturing, in-house training, mentoring
3. INDIVIDUAL ACTIVITIES
 Membership of a VA, Post grad studies, publishing articles, committee contributions, community
work

pg. 8
VOLUNTARY ASSOCIATIONS

 SACAP registration is compulsory – the only competence you have is your: REGISTERED
COMPETENCE
 VA Membership is Voluntary, the CONSTITUTION guarantees all South Africans the right to
freedom of association - this may be exercised by forming, joining + maintaining
cultural, religious + Linguistic associations
 Civil society organizations largely operate as NON-PROFIT, NON-Governmental Organizations
(NGO’s)
 VA – have an important role in CPD development and may charge fees & discounts to their
members, be sure that a VA has a validated course with SACAP to be a legitimate CPD.
 Tap into the Knowledge, Practical Experience + support that VA’s have to offer.
 NB TEST – Engaging + actively participating in VA’s will not only contribute to your career but
also to the strength and vitality of your profession.

pg. 9
LAWS OF CONTRACT + AGENCY AND PROPERTY LAW
NB TEST – “Ignorance of the law excuses no one”
THE CONTRACT

o A contract - Def – Layman’s terms – A contract is a legally enforceable promise.

DEFINITION: A contract is defined as an AGREEMENT, made with SERIOUS INTENTIONS, to
create a LEGAL OBLIGATION, which gives rise to RIGHTS AND DUTIES.
 Not every agreement is a contract (but an agreement made with serious intention to be bound to the
agreement distinguished a contract from an agreement)
 A contract is entered into width the INTENTION to establish rights and duties between the parties.

REQUIREMENTS OF A CONTRACT (5 most identified in SA)

o CONSENSUS
 The parties to the contract must have the same intention of creating a legal obligation with certain legal
consequences
o CONTRACTUAL CAPASITY
 The parties must have the legal ability to form an intention. (over 18, not guilty of a criminal offence etc)
o LEGALITY
 The contract must be legal and must therefore not be in conflict with either common law or legislation
o POSSIBILITY
 The performance in terms of the contract must be possible and determined.
o FORMALITIES
 The contract must be reduced to some visible form as required or prescribed.

THE THREE R’s OF CONRACTING

o A sound contract will provide a balance between RIGHTS, RESPONSIBILITIES & RISKS
o RIGHTS - Rights entitle that one party has against the other, entitling the party who has the right to
compel the other party to do something (or not to). Therefore, should be defined!
o RESPONSIBILITIES – Obligations to do something for the party who has the right (or not to do it)
o RISKS – Risks can be absorbed, shared, transferred, or mitigated in terms of the contract (but not
ignored) in this way risks can be delt with so that that both parties are not caught off guard.

OFFER AND ACCEPTANCE

o OFFER AND ACCEPTANCE – DEFINITION = Practically all agreements are reached by the process of an
OFFER AND ACCEPTANCE. A contract is in place as soon as an offer is accepted (provided that the other
essentials of the contract are in place)
o OFFER – DEFINITION = A declaration of intent by a prospective party to a contract, which contains
proposals regarding the contract
o ACCEPTANCE – DEFINITION = An unqualified declaration of intent that approves the offer without
reservation.
o Counter offer - A back an fourth process of when the offer comes back of an offer but with certain other
terms and conditions attached, that becomes a counter offer.
o OFFEROR – Makes the proposal on the offer.
o OFFEREE - Is to who the proposal or offer is made.
o EAXMPLE: A letter of offer by the architect (OFFEROR) to provide services to the Client (OFFEREE) for a
fee.
o Requirements for an OFFER AND ACCEPTANCE
 The offer must be RECEIVED by the offeree
 The offer must contain all stipulations and essentials that will form part of the CONTRACT.
 The offer must be CLEAR, CERTAIN + UNAMBIGIUOUS.

pg. 10
  The offer must be made with INTENTION of creating a legal obligation
 The offeree cannot VARY the terms offered if this is the case, it will constitute a COUNTER-OFFER,
 A contract is constituted only when the ACCEPTANCE of the offer is communicated by the offeree
to the offeror.

BREACH OF CONTRACT

o BRACH OF CONTRACT - DEFINITION - Brach of contract occurs when the binding agreement is not honoured
by one or more of the parties to the contract.

5 FORMS OF BREACH IN CONTRACT

1. POSITIVE MAL-PERFORMANCE = A party to the contract only performs partially or delivers a
defective performance.
2. DEFAULT BY THE DEBTOR = The debtor (who gets paid) does not deliver his/her performance to the
creditor (who pays) on time.
3. DEFAULT BY THE CREDITOR = The creditor does not cooperate or accept delivery of the debtor’s
performance.
4. REPUDIATION = A Party to the contract communicates to the other party that he/she rejects his/her
contractual duties or will not be able to perform.
5. PREVENTION OF PERFORMANCE = Either party prevents delivery of performance by destroying the
performance or rendering it impossible to deliver the Performance.

THE LAW OF AGENCY

o THE LAW OF AGENCY = DEFINITION: The LEGAL position where one person (the agent) is authorized to act
with AUTHORITY on BEHALF of another (the principal) to create LEGAL RELATIONS with a third party.
o The law of agencies involves three parties
 The agent - Architect
 The principal - Client
 A third party - Contractor
o PROFESSIONAL SERVICE AGREEMENT = Agreement between the client and architect
 PROCSA
 SAIA – Client architect agreement
 SACAP - Client architect agreement
o BUILDING CONTRACT = Agreement between the Client and the Contractor
 JBCC-PBA
o There is therefore no contract between the architect and the contractor as he is acting an the AGENT for the
client – The Agent is simply a mechanism through which the principal carries out contractual obligations.
o AGENCY – is based on a TRI-PARTITE relationship (Meaning there will always be more than two parties
involved)
o In terms of the law of agency, The agent must have CONCENT, AUTHORITY and /or MANDATE of the
principle to act on his/her behalf. And the agent must act in accordance f such authority.
o FIDUCIARY DUTY – The agent has what is termed a Fiduciary Duty, to the principal which constitutes a
LEAGAL + ETHICAL relationship of TRUST with the principal.
o QUASAI JUDICCIAL POWERS = an agent binds the principal in the obligations that he/she creates against
third parties. That resemble those of a court of low or judge.
o OSTENSIBLE AUTHORITY = The third party is under the impression that the agent was authorised to act.
Even if the principal and the agent never discussed such a relationship.
o ESTOPPEL = The courts may prevent a person from making assertions or acting beyond his jurisdiction.
o NB TEST – The third party can sue the agent for fraud if he has been fraudulently misrepresenting his
authority. (hence the importance of a Client architect agreement – giving you the authority)

pg. 11
TYPES OF BUSINESS ENTITIES

TYPES OF BUSSINESS ENTITIES / BUSINESS STRUCTUES

1. SOLE PROPRIETORSHIP – the simplest form of business structure in SOUTH AFRICA, (small business)
o One Person (proprietor) owns and manages the business and is responsible for all business transactions
o Can be set up and started immediately and will often do business under a “Trading as” name.
o S.P. do not offer the same securities that come with entities like private companies. They are not separate
legal entities in the eyes of the law.
o ADVANTAGES
 SET UP - Quick to establish and no CIPC Needed – Companies and intellectual Properties Commission.
 Flexibility – few formal business requirements
 Profits, responsibilities + decision making: Sole proprietors take all profits for themselves and not
share responsibilities and decisions with anyone else.
 Taxation – only the SP is taxed, no business tax.
 Audits – no statutory requirements to audit a SP.
o DISDVANTAGES
 Unlimited Liability – The sole proprietor is subjected to unlimited liability and shares the liability and
financial risks of the business. Any claim a creditor has against the business will be against the SP.
 Taxation – All profits are attributed to the SP which effects taxable income (you can end up paying
higher tax and falling into a higher tax bracket)
 Raising Capital – Raising capital can be a problem, a potential loan is determined by the proprietor’s
personal income and assets only. (Can be an advantage, loans from a financial institution are simpler if
submitted in one’s personal capacity)
 Skills – One person alone has limited skills which can affect the growth of the company, but this can
be mitigated by employing staff or freelancers with the required skills needed.
 LIFE-SPAN – the business only lasts as long as the SP lifetime or trading time.

2. PARTNERSHIP – when two or mor (max 20) come together to form a business.
o These are not separate legal entities like SP.
o ADVANTAGES
 SET UP – basically no legal formalities (no registration with CIPC) Therefore cheap and quick.
 Flexibility – Less strictly regulated than companies and more flexible in terms of management.
 Profits, responsibilities + decision making – Partners share profits: an advantage when partners have
different skills and can work well together. NB TEST – (It is vital that partners have a harmonious
relationship as liabilities and decision-making are shared.)
 Taxation –The partners only pay tax individually; business does not pay tax as it is not considered a
separate legal entity.
 Audits – no statutory requirements to audit.
o DISDVANTAGES
 DISAFREEMENTS – All business ventures involving more than one person run the risk of disputes
arising, but partnerships have no statutory measures for governance like companies. NB TEST –
(When forming the partnerships, a written and signed partnership agreement is advisable)
 Agreement – Partners must be in agreement before forming the business. Later, there is less freedom
to change the basis of the partnership.
 Liability -The partners are subject to unlimited liability: each partner shares the liability + Financial
risks of the Business (If the partnership’s estate is Subquestrated (repossessed). The estates of each
individual partner can also be repossessed.

pg. 12
  Taxation: All profits is attributed to the partners and will therefore be subject to the tax rate of the
individual partner, which can lead to that partner paying higher taxes.
 PROFIT SHARING – Partners share profits equally. NB TEST – This can become an issue, particularly if
the partners do not contribute equally.
 LIFE-SPAN – Only as long as the partners stays in business.

3. PERSONAL LIABILITY COMPANY (INC.) (INCORPERATED)

o Private company – Mainly used by associations of professionals
o The directors (even previous directors) can be held liable for the debts of the company.
o However, the OWNER of a personal liability company is considered separate from the
company.
o ADVANTAGES
 SEPARATE LEGAL ENTITY - A personal liability company is treated as a separate legal entity, separate
from its shareholders
 LIMITED LIABILITY - Shareholders liability is limited: they cannot be held accountable for debt or
actions of the company
 SALE OF WONERSHIP - Transfer of ownership can be achieved with little regulation.
 LIFESPAN – Personal liability companies last indefinitely, which provides security to the owners of the
company.
 Flexibility – The owners are free to decide how they want to distribute profits.
o DISADVANTAGES
 DIRECTORS LIABILITY – Directors can be held personally liable for the debts and actions of the
company.
 LEGAL REQUIREMENTS – Many legal requirements + regulations NB TEST – Can also be an advantage
at it creates certainty.
 COSTS – Need not be expensive, but costs more and is more regulated than establishing a Sole
Proprietorship or partnership.
 Audits – In most cases, Personal liability companies require their annual financial statements to be
audited.
4. Private Company (PTY) Ltd
o A Private company is owned by shareholders and is managed by directors.
o This is the most likely structure for ENTROPRENEURS who want to have the advantages of
running a Business as a company.
o ADVANTAGES
 SEPARATE LEGAL ENTITY – A separate legal entity, separate from its shareholders.
 Limited Liability – shareholders liability is limited. And they cannot be held accountable for the debt
or actions of the private company.
 Foreign Ownership – Foreigners and Foreign entities can own 100% of the shares.
 Sale of ownership – Transfer of ownership can be achieved with little regulations. The transfer of
shares must be recorded by issuing of new share certificates. There are regulations on sale of shares
to the public.
 Management – This can be done efficiently and is regulated in the event of confusion.
 Flexible – Can operate regardless of the size of a business
 Financials – No requirement to file annual financial statements with the REGISTRAR OF COMPANIES,
therefore, annual financial statements are not available to the public.
o DISADVANTAGES
 DIRECTORS LIABILITY – Directors can be held liable personally for the debts and actions of the
company. However, it must be proved that directors were and/or played a part in running the
business in a reckless or fraudulent manner.
 Lega Requirements – Subject to many legal requirements and regulations which can be onerous.
 ACCESS TO CREDIT – The risk of loss is high for financial institutions that fund private companies.
Therefore financial institutions apply more restrictions to private companies versus personal loans.
pg. 13
  PUBLIC INVESTMENT – there are regulations in selling shares to people that are not already
shareholders.A Private company cannot be listed on the stock exchange.
 AUDITS – In most cases, annual audits of financial statements of private companies are required.
5. PUBLIC COMPANY (LTD)
o A public company’s shares are traded publicly – usually on the stock exchange. Such
companies are heavily regulated to protect the public that can invest in them.
o In most cases, a public company will not be appropriate choices for a new business
(Particularly a “Start-up”) as there are requirements that would prohibit its use for most
entrepreneurs.
o ADVANTAGES –
 PUBLIC INVESTMENT – One of the biggest advantages, capital can be raised directly from the public
through the sale of public shares and, if the company qualifies, on a stock exchange such as the
Johannesburg Stock exchange JSE.
 Separate legal entity – a public company is treated as a separate legal entity, separate from
shareholders, with separate tax obligations.
 Limited liability – Shareholders liability is limited, they cannot be held accountable for the debt or
actions of the public company.
 Foreign Ownership - Foreigners and foreign entities can own 100% of the shares
 Life span – Public companies last indefinitely.
o DISADVANTAGES
 Directors Liability – Directors can be held personally liable for the debts and ACTIONS OF A PUBLIC
COMPANY.
 Set-up – Forming a public company is highly regulated, costly and time consuming.
 Ongoing legal requirements – Subject to many day-to-day legal requirements and regulations which
are highly onerous.
 Owner Control: The original Owners may lose control as shares are sold to the public. Once shares are
in the hands of the public, there is now control over the transfer or sale of the shares.
 Number of directors – Must be at least three directors and 7 shareholders.

5 FACTORS TO CONSDIDER WHEN CHOOSING A BUSINESS ENTITY

1. Number of Business owners
 Sole proprietorship can be used only by one business owner.
2. Continuity
 If it is important for your business to continue after your lifetime it is important to choose an entity
that will allow this.
3. Cost of administration
 Running your business as a sole proprietorship will cost you nothing, and a private company will be
on the other end of the scale.
4. TAXATION
 The different legal entities of a business ate taxed differently.
 SP + Partnership taxed according to individual income tax scales
 Private company – Taxed at a flat rate of 28%
5. FINANCING
 How can I raise funds from outside a business?
 SP & Partnership can raise a business loan
 Private company can sell shares to their investors
6. SECURITY
 What will haven to my personal assets if my business goes insolvent?
 SP + Partnership personal assets are always at risk
 Private company Personal + Business assets are always separated.
pg. 14
 o

pg. 15
THE BUSINESS PLAN
Business Plan: Formal statement of Goals, reasons / Motives & Plan of action – focusing on the unforeseen
& should cover a period between 3- 5 years.
6 PARTS OF A BUSINESS PLAN
1. EXECUTIVE SUMMARY
 Summary of the overall conclusions and action plan
2. BUSINESS OVERVIW
 Description of the business and the services you are going to be offering
3. INFORMATION ON MANAGEMENT & STAFF
 Will provide the skills and management of the team and outline of the ownership
4. Legal + Regulatory information
 Registration information of each member
5. MARKETING PLAN
 Highlighting the trends of the industry and goals of the business and activities undertaken to achieve
these goals
6. S.W.O.T Analysis
 STRENGHTS, WEAKNESSES, OPERTUNITIES & THREATS.

pg. 16
BUSINESS ADMINISTRATION

 Business administration = A proactive view of the performance of business operations and decision making.
 NB TEST – POLICIES AND OBJECTIVES determined by the co-founding partners of the business – the
Principles.
 NB TEST – Time spent on admin does not produce income. Therefore, when admin tasks are repetitive, the
best is to develop standardise systems to follow (Pro Forma – Documents, checklists, forms, and
procedures) That assist with repetitive tasks and ensure that minimum requirements are met.

12 - ADMINISTARTION FOUNDING PRINCIIPLES (Partnership agreement)

1. Name of the practice
2. Location of the office
3. Management Roles
4. Management structure
5. Operating Capital
6. Professional Consultants (attorney, insurance brokers etc…)
7. Remuneration & profit / Loss
8. Benefits
9. Working hours per week/day.
10. Expenses
11. Leave / sick leave (Days)
12. Restraint of trade – Limitations after people leave the business

ADMINISTATION CATAGORIES
 OFFICE
 NB TEST – Structured office environment to ensure that all the administrative activities within the
office run efficiently.
1. PRACTICED REGISTARTION – Companies and intellectual properties commission (CIPC), SARS, CETA, PAYE,
UIF, each professional must be registered with SACAP
2. PRACTIVE INSURANCES - (Professional Indemnity, The office space, Equipment, Loss of data, Public
liability. (RISK MANAGEMENT)
3. STAFF STRUCTURE – Contracts & conditions of employment - Determine how the staff will be structured in
terms of lines of communication and responsibilities – Register of all staff general information.
4. OFFICE STATIONERY – Design and Printing (letter heads, business cards, forms, orders, applications)
5. INFORMATION MANAGEMENT- Establish a register to record all issued documentation – Determine the
PROTOCALS for referencing and Filing all documents. NB TEST – (How information can be traced.
6. PUBLIC RELATIONS + MARKETING – Determine the PROTOCOLS for interactions with the public – Which
must be in line with a decisive Marketing Strategy. (Logo’s, fonts…)
 FINANCIAL – (Efficient monitoring of income and expenditure) + NB TEST – Monitor PROFITABILIT
1. FINANCIAL CONTROL – Continuity of the practice is based on the regular influx of fee
generating work. – Budgets for each project (Per work stage) based on fees. Monitored
against time sheets and progress. Expenditure must be authorised by a principal in the
business. – Overtime should be preauthorised. – Targets for profitability must be set – Bank
balances must be checked regularly.
2. RECOVERABLE EXPENCES – Confirm with your client the DISBURSEMENTS & should be
recovered per-month.
3. PROJECT COSTS – Income generated from individual projects should be monitored against
PRODUCTION COSTS in a record.

pg. 17
 4. FINANCIAL RECORDS – bookkeeping and Auditing, to ensure all statutory requirements are
kept.
 PROJECT
1. Every new project must be registered in the practice’s PROJECT REGISTER – Date, project Income,
Location, Project number – Principle responsible for the project – Location for storage of the project
documentation – Also where the documentation is archived.
2. NB TEST – When storing information, you should consider HOW IT CAN BE TRACED BY SOMEONE WHO IS
NOT INTIMATLY ONVOLVED IN A PROJECT.
3. PRO FORMA DOCUMENTS – Standard documentation will be used for every project; this should be stored
in a logical sequence in the file standard. - SAIA has generated the compendium of project guidelines – all
standard documents.


pg. 18
HUMAN RESOURCE MANAGEMENT

 Resource management – DEFINITION = Formal systems devised for the management of people within an
organization
 The most valuable resource in a business is its people, keeping the people contents equates to a
motivated and hight quality of work.
 NB TEST – Most important with people is COMMUNICATION. Keeping members of staff well briefed and
informed about their projects and work (as well as aims, ambitions, and developments of the practice) is
key to keeping the team MOTIVATED + PRODUCTIVE

HUMAN RESOURCE MANAGEMENT

1. LABOUR LEGISLATION
 Regulates the relationship between employers + employees, it is EXTENSIVE & COMPLEX, it is
challenging for practices to remain well-informed of these challenges and regulatory information.
 Department of labour website or solicit services of a specialist consultant or legal practitioner.
 Acts that are related to labour legislation
o Labour relations Act
o Basic Conditions of Employment Act
o Employment Equity Act
o Skills Development Act
o Unemployment Insurance Act
o Occupational Health + Safety Act
o Unemployment Insurance Fund Act
2. RECRUITMENT OF PERSONAL
 NB TEST – Asses the Projected cashflow to project the amount of staff that can be supported within
the Practice
 Options for Obtaining Staff
o Permanent employees
- Vital to long-term health + stability of a practice
- Ensure an appropriate mix of professionals, (architects, technologists, draftspersons
& administrators)
- Determine whether the personal OBJECTIVES + AMBITIONS will be in line with those
of the PRACTICE.
o Temporary employees
- Hired for a fixed period of time determined PRIOR to the commencement of work
- Fill Voids in Production of the practice, typically created by short term needs
- Provide SUPPORT to the core team within the practice by AUGMENTING with
temporary assistance.
o Independent Contractors
- Similar to consultants, typically retained on a short-term, Per-hour basis.
- Hourly or Fixed fee & receive no employee benefits.
- Work must be suitable, and services must be defined, such as task orientated work
with specific outcomes / deliverables.
- Work may occur within the office of a practice, but with Minimal supervision by the
lead architect.
3. AGREEMENTS + POLICIES
 It is important that an OFFER OF EMPLOYEMENT is a contract with LEGAL implications.
 NB TEST – Which must be agreed IN WRITING stating all TERMS and CONDITIONS.
TERMS AND CONDITIONS STATE THE FOLLOWING:
o Commencement Date
pg. 19
 o Provisional period of employment (3months – then permanent)
o Starting salary + salary review period.
o Policies regarding employment
o Training policies (CPD)
o Job description
o Office hours
o Overtime
o Annual +sick leave
o Copyright, confidentiality of information
 NB TEST – it is important when you are signing an agreement to work for a practice or setting out the
document for a new employee.
 Office policies and procedures should be outlined in the form of an OFFICE MANUAL.
o Roles, procedures, office etiquette, protocols, procedure for disagreements or conflicts.
 There should be clear SYSTEMS in place for dealing with the TERMINATION of employment of
members of staff.
4. MOTIVATION + JOB SATISFACTION
 Financial renumeration is not the only factor in ensuring Motivation and Job satisfaction.
 Most important with people is COMMUNICATION. Keeping members of staff well briefed and
informed about their projects and work (as well as aims, ambitions, and developments of the
practice) is key to keeping the team MOTIVATED + PRODUCTIVE
 Involvement and connection with DESIGN activities is frequently a major contributor to job
satisfaction.
 All contributions – not only design – are purposeful and should be managed as such
 Employees should be INVOLVED in making decisions regarding the delivery of services.
 Opinions and talents of the team should be used to find more effective service delivery.
 CONTINIOUS PROFESIONAL DEVELOPMENT, should not just be part of compliance, but should be
considered as GOOD BUSINESS PRACTICE, as learning new information and networking with leading
professionals is very stimulating, motivating and improves the quality of work delivered.

pg. 20
FINANCIAL MANAGEMENT
 Financial Management and control in a practice is probably the MOST CRITICAL aspect for the development
and continuity of a business.
 To survive and thrive a business needs regular influx of new fee-generating work which must be executed
EFFICIENTLY & PROFITABLY!
 The expenditure and CASH FLOW must be monitored very carefully.
 NB TEST – Accounting standards have been developed to present the TAXABLE amount and DO NOT clearly
represent the REAL-WORLD financial situation – From a business point of view.
1. FINANCIAL REPORTS – (The FINANCIALS of a business is divided into 3 categories, & banks would require a
projection of these to obtain financing. )
o BALANCE SHEET
 A snapshot of the businesses financial position at a point in time
 Can be used for the projections of actual COSTS against EXPENDITURE
o PROFIT AND LOSS STATEMENT
 The relation of INCOME & EXPENCES over a specific time period
 Can be calculated per Month
 The financial Statement will indicate the TOTAL for a 12 Month fiscal Period.
 Most importantly is to determine the NET INCOME
- Measures the ability to operate at a profit
- Should be enough to allow FROWTH in the business through reinvestment.
- Your NET-INCOME = BOTTOMLINE
o CASH FLOW STATEMENT
 Details of cash received, and cash expended for each month of the year.
 Projected cash flow statement helps business owners determine whether the company has
positive cash flow
 Negative cash flow will BANKRUPT the company if it continues for a long enough period.
 NB TEST – Cashflow is probably the most immediate indicator of an impending problem!
 When in a negative cashflow, you should re-visit your business plan to solve the problem
2. FINANCIAL RECORDS
o Fees INVOCED
o Fees RECEIVED
o DISBURSMENTS
o VAT invoiced
o PAYMENTS made
o Company EXPENCES
o Value of ASSETS + LIABILITIES
o Statement of work IN PROGRESS
 Consult a FINANCIAL ADVISOR to determine how long to keep RECORDS of the company’s
finances
3. TAXATION
o Taxations is a Financial charge or deduction imposed by a governmental organisation on a taxpayer
(individual or legal entity) in order to fund public expenditure.
o The payment of tax is compulsory and the evasion or providing fraudulent information is regarded as
a criminal offence.
o Central (National), regional and local government organisations collect funds through taxation and
levies in order to finance PUBLIC SECTOR expenditure.

pg. 21
  Infrastructure such as roads and railways, fundamentals such as schools & hospitals or public
buildings, security offered by the police and armed forces, and costs of administration,
salaries, and the running of public services.
o State owned enterprises are also financed by state through taxation
o Revenue for central governance is sourced primarily from income tax value added tax (VAT) and
corporate tax.
o Local government revenue is sourced primarily from central government funding and municipal
rates.
o Collection of tax is managed by the South African revenue service (SARS)
o Taxpayers are required to submit an annual TAX RETURN form to SARS during the annual tax season
(between July and November)
o Local government or municipalities determine the value of a property and the rate at which it is
taxed.
4. INVOICING FOR SERVICES
o Regular invoicing is very important when it comes to running the practice as a business enterprise.
o Invoices for professional fees are due and payable by the client ON PRESENTATION.
 Architectural professionals should not feel embarrassed to be asking for money from their
clients
 Architectural professionals should manage the SCOPE CREEP on projects + should recognise
items that are due for ADDITIONAL FEES.
 Do not wait unit a client is completely committed to the project, and then send and an
unexpected large invoice as this can damage the relationship.
o The client is expected to reimburse for all disbursements that were incurred.
 It is good practice to separate your fees and the disbursements due on each invoice (one
document just two separate line items with a collective total).

pg. 22
RISK MANAGEMENT + INSURANCE

 Know your limitations

 Understand your OBLIGATIONS
 Always keep COMMUNICATING
 Be aware of your RISKS that exist.
 Ensure that you are INSURED.

1. CLIENT EXPECTATIONS
o Clients often expect us to fix everything to their satisfaction, even if the contract terms don’t support
their position… there is an expectation of perfection.
o In reality your practice must meet certain legal and contractual requirements, but these can be
exceeded by your client’s expectations of your practice, about the project and unrealistic project
goals.
o Where do these expectations stem from?
 Our own marketing / communications.
 All deficiencies are our responsibilities (we cannot control everything)
 High expectations + low budgets
 New relationships with a client
 Lack of trust of your expertise
 No budget of services
 The blame games.
o Be careful of how you market and present yourself
o In every project determine your client’s highest priorities, consider each:
 Time
 Cost
 Quality

2. RISK EVALUATION – Questions to ask

o NB TEST – KEY QUESTION TO ASK: Do we have the TIME, RESOURCES + CAPABILITIES to properly
respond to the project requirements and the client’s expectations?
o The client
 Is this a new or existing client?
 Past success rate with the client?
 Has the client arranged for suitable finance?
 Are tor fees going to have to be negotiated?
o The project
 Are we in a competition?
 Are the design requirements clearly defined?
 Is the site appropriate and secured?
 Has a feasibility for the project been carried out?
o The practice
 Do we have knowledge on the typology?
 How much research will be required?
 Number of staff / additional staff required?
 Is over time required to complete the project

pg. 23
 3. STEPS TOWARDS RISK MITIGATION
o Put the assumptions of both parties in writing, to ensure that you understand both parties’
expectations.
o Communicate frequently.
o Be candid + straightforward. And honest about the challenges.
o No Resentments, Clients and contractors are not always reasonable, and perpetuating a grudge does
nothing to improve the situation.
o NB TEST – Document, keep good records of everything! Including own notes.

4. PROFESSIONAL INDEMNITY INSURANCE.

o NB TEST – Without any form of insurance you will have to pay for:
 Your own legal defence costs
 Plus, damages arising from your negligence or breach
 Professional indemnity (PI) Insurance provides PROTECTION
o NB TEST – A liability may either be Contractual of Delictual (The differences between)
 Contractual Liability = You can limit the period of your contractual liability by signing a
Professional Service Agreement.
 Delictual liability = a civil wrong consisting of an Intentional or negligent breach of duty of
care that inflicts loss or hard on another, in most cases, the remedy will take form of
damages claimed.
 You cannot contract out of a delict – only your PI insurance will protect you.
 PI insurance will only cover you for activities carried out as part of your NORMAL
professional duties.
o Most common areas for PI claims
 Non-Compliance with the architect’s Mandate.
 Buildings that fall short of their stated profitability.
 Buildings that are constructed across the building / boundary line. (Need a survey and
correct information).
 Late or incorrect information issued to contractors.
 Materials that fail to perform.
 Buildings that where inadequately inspected during construction.
 Buildings that leak.
 Incomplete lists drawn up at practical completion.
 Failure to issue payment certificates on time.

pg. 24
SCOPE OF PROFESIONAL SERVICES

CONTEXT (CTX)
 Architectural professionals provide PROFESSIONAL SERVICES that deal with design, construction,
enlargement, restoration or alteration of a building or a group of buildings.
 An architect becomes a creative interpreter of the client’s needs and aspirations.
 An architect assists in the selection and appointment of other consultants (such as surveyors and engineers)
and is able to lead the professional team by fulfilling the role of PRINCIPAL CONSULTANT.
 Architectural professionals are trained to ADMINISTER the construction CONTRACT as the clients PRINCIPAL
AGENT.
 Following an initial meeting with a client it is important that your appointment be set out IN WRITING as
soon as possible.
 This comes about through the process of OFFER & ACCEPTANCE the architect compiles a proposal to the
client. “This must Define the SCOPE of the professional services that will be required and the FEE that will be
charged for those services.” This safeguards the essential business relationship between you and your client.
 Once the client has formally Accepted the offer, the contractual arrangement between the two parties is
confirmed through the signing of a PROFESSIONAL SERVICE AGREEMENT (a contract between the client and
architect, such as the PROCSA agreement.)

STANDARD SERVICE (STD)

 The standard scope of an architectural professional is across all the work stages in the following roles:
1. Design consultant
2. Principle consultant
3. Principle agent
 The work stages are characterised by the sequential flow of the services through the entire building delivery
process. These stags are acknowledged by all built environment professionals and throughout the
construction industry.
A. Design
 Inception 5
 Concept + viability 15%
 Design development 20%
B. Document
 Documentation + procurement 30%
C. Administer
 Construction 27%
 close out 3%

NB TEST - SUMMARY OF 6 STAGES

1. INCEPTION
 Clients Brief, needs + aspirations + priorities + constraints
2. CONCEPT VIABILITY
 Scope + scale + character form + function + viability
3. DESIGN DEVELEOPMET
 Finalise design, construction systems + components + services + performance
4. DOCUMENTATION
 Approval submission + Procurement Strategies + Contract documentation
5. PRINCIPAL AGENT
 Administer + Monitor + inspect for conformity + certification of the works
6. COLSE -OUT
 Completion certificates + Final Handover
pg. 25
PARTIAL SERVICES (PRTL)
 When an architectural professional provides a partial service, the client must be made aware that other
consultants must be appointed to complete the services as part of the building delivery process.
o For example, Council submission documents are insufficient for construction.
o National Building Regulations state: An agent is required to CERTIFY that the works were carried out
according to the submitted documentation!
 There are various additional services over and above the standard scope of services: These services are
deemed to qualify for ADDITIONAL FEES. One should only provide these services once the client has AGREED
to pay you.
 Additional services may comprise:
o Special Design Services
o Special Management services
o Special Studies
o Project Initiation services (stage 0)
o Other services

pg. 26
FEES FOR PROFESIONAL SERVICES

 Fees are equally as important as the bricks used to build… The necessary thinking required before the bricks
are laid is EXTEREMELY MORE SIGNIFICANT.
 This argument is strong for fee negotiations, the greater the fee reduction the tighter the budget and man
hours for the practice, you get what you pay for. Architects are generally brilliant at saving costs in
construction, just give then the correct brief and feasibility from the start.
 Architects have TOTAL COMPREHENSION of the project, from concept to completion
 Fees will vary based on complexity, extent, and dynamics of the marketplace.
 SACAP is obligated to publish an annual update for professional fees (Guideline) Project cost-based fees,
Hourly rates & disbursements. (Board Notice 121 of 2015 & Board Notice 122 of 1015)

OPTIONS FOR CALCULATING ARCHITECTURAL FEES

A. PROJECT COST-BASED
o As a percentage % of the PROJECT COST – based on involvement and complexity
o At the beginning of the agreement, the fees are based on a BUDGET for the works. As the design
develops and the project progresses, fees are adjusted to be in line with the anticipated project
costs. The FINAL FEE will be calculated according to the FINAL PROJECT COST.
o WORKS = building Contract
o PROJECT = Overall development (including fees, consultants, full feasibility, etc)
o NB TEST - If any material changes are made in the following categories, the fees must be adjusted.
 Scope of services
 Project Program
 Cost of Project
o Professional fee calculation is a percentage of the project cost in a sliding scale + fixed amount to
smooth the scale.
o FIXED PROJECT COST-BASED FEES – The architect Forfeited the right to recalculate fees.
o EXAMPLE:
 For value of works of = R3,000,000
 Primary fee = Between R2000001 & R4000001 = 268,750
 Secondary fee = (R3,000,000 – R2,000,001) x 10.5% = R104 999.90
 TOTAL FEE = 373 749.90 Ex VAT.
B. TIME-BASED
o At an HOURLY RATE
o Architects will provide their time sheets and charge per hour.
C. DELIVERABLES-BASED
o For specific ACTIVITIES or OUTCOMES
o Deliverable based fees are compiled as a schedule of activities and outcomes involved in the
provision of the architect’s services. The client may choose the extent of the architects services
based on what will be required

FEES FOR LEVEL OF SERVICES

 NB TEST - Where the services EXCLUDES that of the Principle agent, The FEE for that work stage (5+6) can
be reduced by a MAXIMUM OF 10%.
 Should the construction period run for an additional 10%, all additional work may be charged at an Hourly
rate
 ADDITIONS and /or ALTERATIONS may increase the fee by 30% due to the complexity there off.
 HERITAGE PROJECTS may increase the fee by 40% due to the complexity there off.
pg. 27
  REPEATED BUILDINGS in one building contract may Reduce the fee up to 35%
 FAST TRACKING may be increased by 30%

FEE ON TERMINATION

 The FULL FEE for the portion of the service that was carried out, Plus an additional 10% of fee for the stage
in which the agreement was terminated.

PAYMENT OF FEES

 Regular INTERIM invoicing is very important.

 Invoices are due ON PRESENTATION
 The client is expected to re-imburse for the DISBURSEMENTS

FEE REDUCTIONS

 The architect has TOTAL PROJECT COMPREHENSION. This must be turned to an advantage and into an
APPROPREATE FEE INCOME.
 CONSIDER THE FOLLOWING
o Extent of the professional services required
o Complexity and duration of the project
o Time spent on the project must be inline with the renumeration that will be provided.
o Reduced feed do not cater for long-term Inflation
o Costs for disbursement items cannot be reduced
o And changes to design and documentation

pg. 28
PROFESSIONAL RESPONSIBILITIES
RESPONSIBILITY equals ACCOUNTABILITY equals OWNERSHIP. And a sense of ownership is the most powerful
weapon a team or organization can have…

1. CORE RESPONSIBILITIES
 To adhere to good design, quality, and excellence.
 The SACAP code of Conduct
 Understand the work within legal + regulatory contexts and properly for services (using PSA)
 Do not offer services outside your competence
 Be familiar with construction contracts

2. STSTUTORY RESPONSIBILITES
 ACHITECTURAL PROFESSION ACT (44 of 2000)
 CODE OF CONDUCT (B.N 154 OF 2009)
o NB TEST - Consider these items when considering a letter of offer
9. Scope of the project
10. Scope of your services
11. Limits to responsibilities
12. Fees: How calculated + payable
13. Budget or cost limit
14. Provisions for termination
15. Details for PI insurances
16. Provision for dispute resolution

3. CONTRACTUAL RESPONSIBILITIES
 These form part of the OBLIGATIONS to the client in the provisions of the architectural service
 Act as the clients AGENT within the scope of authority.
 Exercise REASONABLE – CARE + SKILL + DILIGENCE in the performing of professional duties
 Respond TIMEOUSLY to the client’s reasonable requests.
 Use architectural Knowledge + Expertise to produce designs that meet the clients NEEDS within
reasonable financial limitations (Not responsible for financial viability of the project)
 Design buildings to comply with Conditions of Title, applicable legislation, Town planning codes and
building regulations.
 Adopt PROCEDURES + METHODS suited to the agreed scope and complexity and to the nature,
extent, and time of the project.
 Acy FAIRLY and IMPARTIALLY, in terms of the relevant building codes.
 Exercise reasonable care to avoid delaying or disrupting the contractor.
 Advise the clients of Risks or expenses that may arise from scope changes or instructions.
 Provide Professional Indemnity insurance. And maintain insurance policies while service is provided.

4.

pg. 29
PROFESSIONAL SERVICE AGREEMENTS (PSA)

Formal contract between you and your client to provide a SERVICE for a FEE. Entered following a clients
ACCEPTANCE of the architectural professional’s OFFER.

The appointment of an architect starts with an INTRODUCTORY meeting with the prospective client. The architect
outlines the services + fees in a letter of OFFER. The client provides a Written ACCEPTANCE of the offer, and the
professional service agreement is SIGNED. Which constitutes the FORMAL CONTRACT between two Parties.

- SAIA client architect agreement

- PROCSA Professional service agreement

Documents are based on:

 ACHITECTURAL PROFESSION ACT (44 of 2000)
 National Building Regulations and Building Standards (103 of 1977)

NB TEST - The architect accepts the appointment to exercise REASONABLE (DEFINITION: the service must
be comparable to what another architectural professional would provide under the same
circumstances during the same period of time.)
- SKILL
- CARE
- DILIGENCE

In the performance of the OBLIGATIONS accepted in terms of the agreement. For a fee as set out in
the agreement
NB TEST - Reasons for using a STANDARD FORM PSA.
 Ensure Fait & reasonable Contractual Arrangement
 Facilitate the UNDERSTANDING between you and your client
 Formalise the BUSINESS ARRANGEMENT between the client and the architect.

NB TEST - Without a PSA, Common Law will apply

 Payment for services will only the completed project is handed over.
 No changes to the agreed scope of the service nor the extent of the project
 All disputes must be resolved in courts through litigation.

NB TEST - RISKS in a letter or a BESPOKE agreement

 May require Lengthy and costly negotiations between the parties
 May not make provision for all circumstances
 Are not supported by a history of case law
 May unintentionally increase the obligations of the architect beyond the norm.

STRUCTURE OF PSA AGREEMENTS

1. ARCHITECTS SERVICES
2. OBLIGATIONS OF BOTH PARTIES
3. CONDITIONS OF SERVICE
4. FEE FOR PROFESIONAL SERVICES
5. DEFINITIONS AND INTERPRETATIONS
6. ARTICLES OF GOVERNANCE

pg. 30
PROCSA WORK STAGE ZERO – PROJECT INITIATION
The responsibility and service for the CLIENT or the DEVELOPMENT MANAGER.
- Establish the NEEDS and Desirability of the project.
- Evaluate the appropriate PARAMENTERS of the project, the VISION and FEASIBILITY.
- Appoint the appropriate CONSULTANTS
- Identify and secure appropriate land for the project. And obtain all rights and Zoning info.

ESTABLISH THE BUSINESS ARRANGEMENTS between you and the client

- Set out the STANDARD scope of services
- Grants AUTHORITY to an architect
- Provide for INTERIM payments
- Provide for DISPUTE resolution
- NB TEST - Limit the LIABILITY of the architect

pg. 31
THE CLIENT + PROFESSIONAL TEAM
THE CLIENT
 Good architecture is not possible without a good client.
 To ensure good architecture, the architectural professional must be dedicated to establishing and Nurturing
SUCCESSFUL RELATIONSHIPS.
 Clients may range from individuals to Multinational organizations or corporations, from large government
agencies to small private sector firms, from offshore developers to the actual occupants of a building.
 In addition to understand the distinctions between the OWNER, A USER and an OCCUPANT, the architect
must address the requirements of EACH.
 A client is purchasing professional services that enable the end result of a material good.
 Managing client relationships and personalities is similar to other human relationships and the management
of people and human resources.

THE PROFESSIONAL TEAM

 The commencement of consultant’s services rely on the architectural professional’s interpretations of the
clients Brief, the intricacies and constraints of the site, and all the factors that are likely to determine the
form of the building.
 The architectural professional is preferably appointed as the PRICIPAL CONSULTANT, to coordinate the
design contributions of other consultants, and arrange, chair and record professional team meetings.
o CORE SERVICES
 ARCHITECT
 PROJECT MANAGER
 QUANTITY SURVEYOR
 STRUCTURAL ENGINEER
 CIVAL ENGINEER
 ELECTRICAL ENGINEER
 MECHANICAL ENGINEER
o OTHER CONSULTANTS
 FIRE CONSULTANT
 LANDSCAPE ARCHITECT
 HEALTH AND SAFTEY CONSULTANT
 INTERIOR DESIGNER
 WET SERVICES ENGINEER
 ACOUSIC ENGINEER
 OTHER DICIPLINES.

pg. 32