5.2 AIA Documents, Offers & Contract Components

5.2 AIA Documents, Offers & Contract Components

A bid that is accepted is a contract. Area B therefore tests the components of a valid contract, how to write an offer, how to review contracts, the statute of frauds, and the three AIA books on the 2026 B&F list: A201-2017, A401-2017, and A701-2018. The Contractors Manual 2025 and Chapter 489 sit beside those forms: a perfectly drafted AIA agreement still fails if the signer is unlicensed for the scope or if the recovery-fund notice is missing on a residential job over $2,500.

Five components of a valid contract

1. Offer. A definite proposal: who will do what, for how much, by when. A Class B "we can probably do that 40-ton rooftop unit for around $80,000" is not a definite offer. A signed bid on the A701 form that prices the specified unit, acknowledges addenda, and carries the license number is an offer. Florida treats bidding itself as contracting (F.S. 489.105(6)).

2. Acceptance. A mirror-image assent communicated as the offer requires — signing the agreement, issuing a notice of award, or performing on the documents the parties actually used. A counter-offer (the owner crosses out your deposit term and writes "net 90") is not acceptance; it is a new offer. Silence is not acceptance unless prior dealing makes it so.

3. Consideration. Each party bargains for something: the owner bargains for the HVAC work; the contractor bargains for the contract sum. Past consideration ("you already replaced my capacitor last week, so this contract is for that") does not support a new promise. A change order needs its own consideration — additional money, time, or a mutual scope swap.

4. Capacity. Minors and adjudicated incompetents lack capacity. On the contractor side, the person signing must have authority for the qualified business organization. A qualifying agent's CILB affidavit (F.S. 489.119(2)(b)) states that the qualifying agent has final approval authority on contracts unless a Financially Responsible Officer (FRO) is approved for financial matters. A superintendent's handshake in the parking lot does not bind the entity if that person had no actual or apparent authority. The other party needs capacity too: a condominium association may need a board vote; a school board needs a lawful award.

5. Legality. The object of the contract must be lawful. A contract to install HVAC without the required Class A or Class B license is unenforceable by the unlicensed contractor (F.S. 489.128). A contract that requires you to ignore the Florida Building Code — Mechanical, 2023, to vent refrigerant, or to skip workers' compensation is illegal to that extent. F.S. 725.06 limits construction indemnification: a clause that indemnifies the other party for its own negligence is unenforceable unless a monetary limitation is stated and was included in the project's specifications or bid documents.

Missing any one of the five, you do not have a contract you can count on in court — and you may still have a CILB problem if you performed anyway.

Statute of frauds — F.S. 725.01

Florida's statute of frauds, F.S. 725.01, bars an action on certain promises unless the agreement, or a note or memorandum of it, is in writing and signed by the party to be charged (or that party's authorized agent). The construction-relevant clauses are:

• A special promise to answer for the debt of another (suretyship — personal guarantees of a subcontract or of a 255.05 bond indemnity).
• A contract for the sale of lands or a lease longer than one year.
• An agreement that is not to be performed within the space of 1 year from the making thereof.

The one-year clause is the HVAC trap. The test is whether full performance is possible within one year from the making of the contract, not whether performance actually took that long. An oral agreement to replace a 3-ton residential split this Saturday is performable within a year and is not barred by 725.01 merely because it is construction. An oral agreement in January to furnish and replace classroom units on a phased 18-month school schedule that cannot be completed within one year is within the statute and needs a writing. Florida courts read the one-year rule strictly; if the contract could have been performed within a year, 725.01 does not demand a writing.

Do not confuse 725.01 with other writing rules. Chapter 713 lien rights, F.S. 255.05 bond claims, F.S. 489.119 license numbers, F.S. 489.1425 recovery-fund notices, and AIA A201's "in writing" notices are independent. A handshake 3-ton changeout may survive 725.01 and still fail 489.1425 or the advertising-number rule. Equipment sold without installation may also fall under the Uniform Commercial Code writing requirement for sales of goods; contracting to install a system is still Chapter 489 work.

How to review a contract, and how to write the offer

Review in this order: parties and license number; scope versus drawings and addenda; price and payment; time; changes; claims; insurance and bonds; indemnification; disputes.

• Parties. Named insured, CILB qualifier, and Sunbiz name must match. A bid in the trade name when the certificate is in the LLC's legal name is a surety and permit problem.
• Scope. Attach the drawings, specifications, addenda, and a written exclusions list. "HVAC complete" on a hospital drawing that includes chillers, cooling towers, and building automation is how Class B firms bid themselves into 489.128.
• Money. Stated sum or unit prices, allowances, retainage, stored-materials payment, and whether pay-when-paid (timing) or pay-if-paid (condition) is being pushed onto you as a sub. AIA A401-2017 is a pay-when-paid structure: the contractor pays the subcontractor within seven days after the contractor receives payment from the owner, with a demand right if delay is not the subcontractor's fault.
• Time. Commencement, substantial completion, liquidated damages per calendar day. A201-2017 §8.3 addresses delays, including documented adverse weather.
• Changes. See Article 7 below. Never proceed on a "minor change" that costs money without written notice.
• Claims. A201-2017 Article 15: claims arising before the end of the correction period generally require written notice within 21 days after the occurrence or after the claimant first recognizes the condition, whichever is later. Missing the 21-day clock is a forfeiture, not a paperwork preference.
• Insurance and bonds. CILB floor is $100,000 public liability and $25,000 property damage; project specifications often demand $1 million per occurrence, additional-insured status, and waivers of subrogation. A201 Article 11 allocates contractor and owner insurance and any required bonds. Public work: 255.05 bond recorded before you start.
• Indemnification. Read against F.S. 725.06. Unlimited hold-harmless for the owner's own negligence, with no monetary cap in the bid documents, is the clause you mark for counsel.
• Disputes. A201 uses an Initial Decision Maker (often the Architect), then mediation, then binding dispute resolution as selected in the agreement (arbitration or litigation).

Writing the offer is the reverse of that checklist. State the five contract elements in plain language, put the license number on the face (F.S. 489.119(5)(b)), include 489.1425 on residential work over $2,500, and do not promise a 40-ton rooftop unit on a Class B ticket.

AIA A201-2017 General Conditions

A201-2017 is not the price. It is the operating system for the contract. Articles the B&F exam cares about:

Article 7 in three boxes:

• Change Order (§7.2). Written instrument prepared by the Architect and signed by Owner, Contractor, and Architect, stating the change in the Work, the adjustment in Contract Sum, and the adjustment in Contract Time. This is the clean extra you want for an owner-directed coil change or a curb revision.
• Construction Change Directive (§7.3). Written order prepared by the Architect and signed by Owner and Architect, directing a change before agreement on price or time. The contractor must proceed; the sum is adjusted by later agreement, by unit prices, by markup on cost, or by the Architect's determination, with claims under Article 15 if you disagree. A CCD is how an occupied school stays on schedule when night-work pricing is not finished.
• Minor changes (§7.4). The Architect may order, in writing, minor changes consistent with the intent of the Contract Documents that do not adjust sum or time. If you believe the "minor" change costs money or time, you must notify the Architect and not proceed. If you perform without that notice, you waive the adjustment.

AIA A401-2017 Contractor-Subcontractor

When you are the HVAC sub to a general contractor, A401-2017 is the form on the 2026 list. The core idea is flow-down: the subcontractor is bound to the contractor by the same terms the contractor is bound to the owner, as applicable to the subcontract work. You inherit A201's claims clocks, insurance, safety, and changes procedures unless the A401 is modified.

Article 11 Payments is the money article. Progress payments are calculated on a simplified basis in the 2017 revision. Timing is pay-when-paid: payment to the sub within seven days after the contractor receives the corresponding payment from the owner. If a certificate is not issued or the contractor is not paid for reasons that are not the subcontractor's fault, A401 gives the sub a right to demand payment rather than wait forever. That is still not a pure pay-if-paid condition subsequent unless someone wrote one in; read the modifications. Final payment follows retainage release and closeout documents. Do not waive bond rights with a non-statutory waiver form on a 255.05 job; Florida specifies waiver forms.

A401 also addresses time, changes (mirroring Article 7 concepts), termination, and insurance. If the prime contract required a 255.05 bond, your payment protection is that bond plus any A401 remedies — not a Chapter 713 lien on the public library.

Florida HVAC scenario

In January, a Class A qualifier and a facilities director shake hands on "all the classroom units, we'll just keep going through next summer." No writing, no license number, no 21-day claims language, no price. Work will take 18 months of phased replacements and cannot be finished within one year. Under F.S. 725.01, an action on that agreement is barred unless a signed writing exists. Even if they later sign an AIA agreement with A201 general conditions, the original oral deal is the statute-of-frauds problem until it is reduced to a signed memorandum.

If the same owner instead issues A701 instructions, the contractor submits a bid (offer) with the license number, the board accepts, and they sign, you have offer, acceptance, consideration, capacity, and legality. Mid-job, the architect issues a "minor change" moving ten condensers to a screened roof well. That is crane time and a curb redesign. Under A201 §7.4 the contractor must notify the architect and not proceed, then price a Change Order. If the contractor hangs the condensers first and asks for money later, the extra is waived. If the contractor is a sub on A401, the same change still has to move through the general contractor, and payment waits seven days after the general contractor is paid — unless delay is not the sub's fault and the sub demands payment.