2. Limiting who can be sued
When a claim arises between an owner and design professional it is rare individuals—as opposed to the firm—are named as defendants, but it does happen. One way to minimize this risk is to insert a provision in the contract such as the following:
No shareholder, member, officer, director, employee, or agent of the Architect or the Owner shall be personally liable, directly or indirectly, under or in connection with this Agreement, or any document, instrument or certificate securing or otherwise executed in connection with this Agreement, or any amendments or modifications to any of the foregoing, made at any time or times, hereto or hereafter; and the Architect and the Owner and each of their respective successors and assigns, do hereby waive any such personal liability.
Again, such a provision does not protect the individual who worked on the drawings from being sued by a third party, such as an injured worker. It should, however, prevent the owner or lender from filing a suit against that individual so long as the latter did not sign the agreement in his or her own name. This means that, when the president of the architectural firm signs the agreement, she or he needs to indicate the role as “president” to sign the agreement in that capacity. She or he is not signing the agreement on her or his own behalf, but rather, as an agent of the firm.
This type of provision should be easy to negotiate into an agreement because it protects the owner as much as the designer.
