EJCDC publishes 2020 editions of E-500 and E-570

engineer_industrialThe Engineers Joint Contract Documents Committee (EJCDC) recently published revised versions of E-500, Standard Form Agreement Between Owner and Engineer for Professional Services, and E-570, Agreement Between Engineer and Subconsultant for Professional Services.

E-500 Main Agreement Updates
E-500 is a comprehensive standard contract for engineering design services and related construction phase engineering and administrative services. The terms and content of the 2020 edition are coordinated with the 2018 edition of EJCDC’s construction (C-series) documents, including C-700, Standard General Conditions of the Construction Contract. Although the new E-500 has been only slightly modified, the changes are significant in their tracking of current legal and practice issues in the infrastructure design and construction industry.

The basic content and philosophy of the main agreement remain consistent with prior editions. In addition to routine edits for readability, clarity, conciseness, and coordination with the exhibits, a few notable changes have been made to address evolving practice trends and contemporary contracting matters.

Users will note one obvious change that varies from a long-standing EJCDC convention in that it has adopted the widespread industry practice of referring to an engineering or other A&E firm retained by the prime engineer as a “Subconsultant” rather than as a “Consultant.” By recognizing that the engineer engaged by the owner is normally itself a consultant in common parlance, EJCDC believes that use of the term subconsultant will serve to better distinguish the engineer from the firms it retains and eliminate potential confusion, especially in the subagreements used by the engineer to retain subconsultants.

The other changes of which consulting professional engineers should be aware include the following:

Ownership and use of documents

To address the needs of some owners, the main agreement’s section on “Ownership and Use of Documents” now presents two options regarding ownership of project documents:

  1. under the first option, and following prior E-500 practice, the engineer retains all ownership of project documents, but grants the owner a fully functional limited license for use of the project documents; or
  2. under the second option, and upon the owner’s request, the engineer grants to the owner all ownership rights to the design documents, subject to provisions regarding reuse and recognition of the engineer’s retention of rights to “Previously/ Independently Created Works.”

E-500 is now packaged in two parts: the main agreement and the exhibits

The new version of E-500 is published as two separate Word files, one containing the main agreement form and the second containing the exhibits (A through J). Both parts contain integral building blocks of an owner-engineer contract. As the agreement and exhibit options have grown over the years, it made sense to split E-500 into two manageable parts for ease of use and project customization.

Owner’s responsibilities moved to main agreement from exhibits

Recognizing that the owner’s responsibilities typically remain constant from project to project, EJCDC has moved the contents of what was formerly Exhibit B, Owner’s Responsibilities, directly into article two of the main agreement.

New deliverables schedule exhibit

E-500 now features a separate consolidated schedule form, Exhibit B, for establishing the engineer’s deliverables. In prior editions of E-500, the engineer’s schedule and deliverables obligations were interspersed throughout the engineer’s scope of services (Exhibit A). The new deliverables schedule form is in table format and includes guidance for use. The sample entries track the engineer’s deliverables commitments in Exhibit A and include sample entries for the owner’s related obligations to review and return the deliverables with comments within a specified number of days of receipt.

Update and relocation of payment exhibit

E-500 contains a very comprehensive payment exhibit, offering the user six standard compensation methods, five options for “Resident Project Representative” (RPR) compensation, three options for “Additional Services” compensation, and related schedules and appendices. The user has the option of selecting any combination of these payment methods for any given project. In prior versions, this very flexible, but lengthy set of options was designated as Exhibit C, located in the middle of the exhibits. EJCDC found that many public and private users preferred to address specific compensation and fee matters as the last attachment to their agreements, often appending the engineer’s fee forms to the very end of the contract. In addition to updating the content of the payment exhibit to reflect current practices and establish consistency among the compensation methods, the payment provisions are now at the end of E-500 as Exhibit J.

Electronic documents protocol added

In keeping with EJCDC’s efforts to facilitate use of electronic documents, an “Electronic Documents Protocol” (EDP) has been added as Exhibit F. The EDP allows users to specify formats for exchange of electronic information and customize responsibilities for managing project communications. This exhibit parallels the basic EDP language used in EJCDC’s construction series for owner-contractor contracts, but has been customized for the specifics of the owner-engineer relationship.

Other E-500 exhibits

The general content of the other exhibits—the Amendment Form (now Exhibit C), Duties of the Resident Project Representative (Exhibit D), Notice of Acceptability of Work (Exhibit E), Insurance (Exhibit G), Dispute Resolution (Exhibit H), and Limitation of Liability (Exhibit I)—has been updated and reformatted, but remains substantively unchanged.

Significant Changes to Exhibit A, Engineer’s Services

The most significant changes in content for E-500 have been made to Exhibit A, Engineer’s Services. Exhibit A serves as an industry resource for contractually describing a comprehensive scope of engineering services, from the planning stage through design, contractor selection, construction, and post-construction services. Although presented in linear fashion and well-suited to traditional design-bid-build project delivery, the scope of services exhibit is flexible and can be modified to suit narrower project delivery, including fast-tracking, multi-prime, CM, or RFP/proposal projects. Similarly, although the Exhibit A services and terminology are closely coordinated with the contents of C-700, Exhibit A (and E-500 generally) can also be used in conjunction with non-EJCDC construction contract documents.

The 2020 update adds meaningful detail to many engineering service categories and contractually articulates evolving industry practices, some for the first time in a standard design industry contract document. As always, Exhibit A is intended to be customized by each user for the specifics of the particular project, but EJCDC is confident that this new edition provides an improved and more robust starting point for creating a detailed scope of the engineer’s services.

The important changes made to Exhibit A are summarized below:

Guidance and a general outline were added to the beginning to prompt the user to include a more detailed project description (“Baseline Information”) to better define the nature and extent of the facilities covered by the scope, and to provide context to the engineering services to be provided by the engineer.

There is now formal recognition of “Management of Engineering Services” as an important part of the standard scope of services by assigning it a specific section under the engineer’s basic services. Essential engineering project management needs, such as scheduling of tasks, internal team coordination, project record keeping and file maintenance, pre- and post-project meeting coordination, and documentation have mostly been implied as part of other tasks in prior versions of Exhibit A. The management section is clearly drafted to apply only to project-specific management activities, as opposed to general overhead and firm management functions.

The “Preliminary Design Phase” section has expanded guidance for the content of this design phase, adding a general list of matters to be considered in completing the preliminary design and addressing the project’s goals. EJCDC also formally uses the term “Preliminary Design Phase Report” to encompass the agreed-upon deliverables for this phase. Since the precise form of the report and individual deliverables is determined by the users, it can vary from the less-defined compilation described in prior versions of E-500 to the much more formal reporting needed for large, complex, or multi-discipline facilities.

E-500 has traditionally NOT specified a rigid interim submittal protocol based on design completion percentages (such as 30%, 60%, 90%, or 100% completion). EJCDC defers to users to define their own submittal needs. The 2020 update, however, includes “Guidance Notes” that more clearly explain E 500’s approach to submittal schedules; for example, by comparing the preliminary design report submittal to a 30% completed design. Also, in addition to the “Final Design” submittal, the “Final Design Phase” now provides two interim draft design submittals. As with all elements of Exhibit A, this multi-step process can be revised at the user’s discretion.

Acknowledging the growing complexity of utility coordination needs on projects, EJCDC has added a more extensive process for above ground and underground utility coordination. Formal utility coordination commences in the “Study and Report Phase” and continues through the “Preliminary and Final Design Phases,” with progressively more detailed identification, communication, and mitigation activities. The process expands the requirements from prior versions and parallels the coordination process used by many DOTs and public agencies.

Exhibit A now clarifies the engineer’s role in identifying and analyzing requirements of authorities having jurisdiction to approve design, construction, or operation of facilities, and in maintaining a comprehensive list of permits during design to help track approval processes and responsibilities of the parties.

The update also provides a reorganized and somewhat more detailed and proactive approach to development of the construction contract documents, particularly relative to the owner’s procurement process for the bidding/proposal process and the construction contract. In addition, “Construction Phase Services” has been reviewed for conformance with the 2018 C-Series updates, paying particular attention to the authority of the engineer as described in C-700.

Exhibit A continues with the approach to sustainability added in the 2014 edition of E-500. This update includes a task to review design criteria with the owner and address the owner’s requests for additional studies and services to enhance resilience of the project.

E-570 Updates
E-570 has been updated along the same lines outlined above. Previous editions of E-570 were titled “Agreement Between Engineer and Consultant for Professional Services,” using the term “Consultant” to refer to an engineering (or other A&E) firm retained by the engineer to undertake a portion of the overall professional services. The 2020 edition uses the term “Subconsultant” rather than “Consultant.” The term subconsultant is in widespread use in the engineering profession and provides a stronger distinction between the engineer (itself a consulting firm or consultant in common industry parlance), the prime design professional, and the lower-tier firms retained by the engineer to assist with professional services.

The contents and structure of E-570 are rigorously coordinated with the provisions of E-500. The two documents use consistent terminology and wording whenever possible. Despite this strong linkage, however, it is possible to use E-570 as an engineer-subconsultant subagreement even when the prime agreement is not E-500 or another EJCDC document.

The new versions of E-500 and E-570 can be purchased through EJCDC’s online store. The documents are downloaded at the time of purchase and saved directly to the user’s computer in Microsoft Word and can be customized to suit each firm’s concerns, the project’s unique goals, and specific regulatory requirements.

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