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DIR 04/22 | Transfer of Commissions

Explanatory Note

The transfer of commissions, projects and tasks from one perit to another is generally a delicate and potentially complex transition which can give rise to a number of issues related to ethics, commercial interests, and intellectual property rights.

In 2009, the Council of the Kamra had, at the behest of the General Meeting, issued the Change of Perit Directive that sought to govern the transition from an ethical perspective. The focus at the time was not to stifle the possibility for the incoming periti from delivering their professional services and not to unduly harm clients who may be victims of vexatious requests for payments from outgoing periti. As a result, Directive 04/09 had stipulated that outgoing periti must hand over projects to the incoming perit even if there are outstanding payments due.

Over time, however, the original intentions of the 2009 directive were thwarted to the point where periti frequently ended up not getting paid for their services by their clients, who exploit the directive to move projects from one perit to another, sometimes more than once, to avoid paying for professional services.

This directive seeks to strike a fairer balance between the rights of periti to get paid, and the protection of clients from vexatious claims for payment.

It is important to underscore that the rights and obligations outlined below pertain exclusively to the realm of professional and ethical conduct, and do not overrule or substitute civil law. It is thus recommended that in exercising the professional rights enunciated below, periti seek legal advice to ensure they do not expose themselves to civil claims for damages.

Members of the profession are also notified that this Directive was vetted by the Kamra’s legal advisors.

 

Directive

 

The Council of the Kamra tal-Periti hereby gives notice to all members of the profession of this Directive governing the transfer of commissions, or engagements to provide professional services, from one perit (or partnership of periti) to another.

 

This Directive outlines the processes to be followed in such cases, as well as the relative rights and obligations of the periti involved, and matters relating to liability.

 

Directives DIR 04/09, DIR 03/19 and Circular CIR 02/09 are being hereby repealed.

 

 

1. PROCESSES

 

1.1 When a development application is still ongoing

When a commission is terminated during the processing of a planning application, the outgoing perit shall, in addition to the client and the Kamra, also notify the Planning Authority via eApps, requesting immediate suspension of the planning application process in terms of S.L. 552.13 reg 12 (1) to provide sufficient time for:

  • the client to identify another perit;
  • the outgoing and incoming periti (or partnership/s of periti) to satisfy their respective obligations as set out in this Directive;
  • the compilation and submission of any forms that may be prescribed by the Planning Authority.

 

1.2 When works are underway

When a commission is terminated after construction works have commenced, the outgoing perit shall, in addition to the client, also notify the Kamra tal-Periti, the Building & Construction Authority[1], the Planning Authority[2], and the Commissioner of Police[3], as well as the Superintendence of Cultural Heritage[4], where applicable, to ensure that no works proceed without the general supervision of a perit, and the necessary forms as may be prescribed by the Building & Construction Authority, Planning Authority, and any other relevant statutory bodies, are formally filed[5].

 

1.3 In all other cases

In all other cases where the statutory processes described above do not apply, the provisions in Sections 2 and 3 only shall be applicable.

 

 

2. RIGHTS & OBLIGATIONS OF THE OUTGOING PERIT

 

2.1 Right to refuse release

A perit may refuse to release a commission in the following circumstances:

a) if the termination is being initiated by the client in cases where the perit has issued legitimate instructions to safeguard public safety, structural integrity of buildings, the protection of cultural heritage and the environment, compliance with planning permit conditions, and/or adherence with laws, regulations, directives and codes.

 

b) if the perit has not been remunerated in accordance with the terms set out in a written agreement[6] with the client.

 

Provided that if any of the above circumstances exist, the perit shall immediately notify the Kamra providing details of such circumstances.

Provided further that once the outgoing perit has been remunerated, or a final decision is reached by a Court or other adjudicating body, the outgoing perit shall release the commission to the incoming perit and proceed with the handover in accordance with section 2.3.

Provided further that if no circumstances as described above exist, the perit shall not withhold the release of his commission unless otherwise authorised by the Council of the Kamra tal-Periti.

 

2.2 Obligation to notify

The outgoing perit shall in all circumstances, follow the processes set out in section 1 of this directive, as applicable.

Provided further that if the commission is being terminated by the outgoing perit, s/he shall keep a record of the relative written notification to the client of the termination.

 

2.3 Obligation to provide handover

Upon being notified in writing by the incoming perit that s/he was engaged by the client to take over the commission, the outgoing perit shall provide the incoming perit a full handover within a reasonable amount of time, which handover shall include information about the design, site conditions, site survey, the client brief governing the services s/he had hitherto provided, photographs of the works, instructions and reports about the works, communication with the various authorities until the time the original perit was still entrusted with the commission, and any other relevant information necessary to safeguard public safety, structural integrity of buildings, the protection of cultural heritage and the environment, compliance with planning permit conditions, and/or adherence with laws, regulations, directives and codes, as may be applicable depending on the nature of the commission.

Provided that such handover excludes the transfer of intellectual property belonging to the original perit, including any digital information such as CAD drawings, 3D models, and other similar data, unless agreed to by the outgoing perit at his/her discretion or as may have agreed in a prior written agreement between the outgoing perit and the client.[7]

Provided further that the outgoing perit may request payment for the transfer of his/her intellectual property, unless otherwise specified in a written agreement between the original perit and the client.

Provided further that the outgoing perit may request additional remuneration and/or termination fees from the client to provide a handover as long as this is already provided for in the written agreement.

 

3. RIGHTS & OBLIGATIONS OF THE INCOMING PERIT

 

3.1 Obligation to notify

Upon being approached by the client to take over the commission from another perit, the incoming perit shall notify in writing the outgoing perit of this requesting the initiation of the handover process.

 

3.2 Obligation to refrain from taking over a commission

A perit shall refrain from accepting to take over a commission originally commenced by another perit in the following circumstances:

 

a) If the original perit is being substituted for issuing legitimate instructions to a contactor to safeguard public safety, structural integrity of buildings, the protection of cultural heritage and the environment, compliance with planning permit conditions, and/or adherence with laws, regulations, directives and codes.

 

b) If the original perit has not been remunerated in accordance with the terms set out in a written agreement with the client.

Provided that if no such written agreement exists, the incoming perit will not be impeded from taking over the commission as long as other sections of this directive are followed.

 

c) If the incoming perit has not notified the original perit in writing and requested a comprehensive handover from the outgoing perit.

 

For the purposes of this Directive, taking over a commission shall include the submission of Change of Perit Forms, or other equivalent forms, to any authority. Incoming periti are prohibited from filing such forms.

The Council of the Kamra tal-Periti shall consider any actions by a perit to take over the commission of another perit before resolving such disputes as constituting “supplanting” in terms of Provision 4 of the Code of Professional Conduct.

Provided that an incoming perit shall not be impeded from taking over a commission, if the outgoing perit chooses to waive his/her rights outlined in section 2.1.

 

4. PROFESSIONAL LIABILITY WHEN TRANSFERRING COMMISSIONS

4.1 Under no circumstance shall a transfer of a commission constitute the transfer of liabilities between periti (or partnerships of periti).

4.2 The outgoing perit shall remain liable for the professional services s/he has completed until the date of the transfer becomes effective.

4.3 The incoming perit shall be liable for the professional services s/he provides from the date the transfer becomes effective onwards.

4.4 The handover information should be sufficiently detailed to clearly demarcate the liabilities of both outgoing and incoming periti, and is to include a clear indication of all services rendered and works erected by the effective termination date.

 

Perit André Pizzuto
President

 

[1] Notification to the BCA can be effected via eApps (Avoidance of Damage tab) or via email info@bca.org.mt

[2] Notification to the PA can be effected via eApps (Submit Correspondence tab)

[3] Notification to the Commissioner of Police can be effected via email on pulizija@gov.mt

[4] Notification to the SCH can be effected via email on monitoring.sch@gov.mt

[5] The PA’s Change of Perit form and the BCA’s Change of Responsibility form are to be submitted by the outgoing perit.

[6] For the purposes of this Directive, a written agreement, which can be in the form of a contract, letter of engagement, or quotation approval (including via email), shall include as a minimum:

  • confirmation that the client has accepted the perit’s offer to provide clearly specified services;
  • the remuneration the perit will receive from the client in exchange for the services agreed upon;
  • the date of such agreement.

[7] Periti are advised to refer to Directives DIR 01/15 and DIR 02/18 for further detail on intellectual property rights held by periti.

 

 

 

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DIR 01/18 | Fees

Over the past couple of years, the Council of the Kamra tal-Periti has received an ever increasing number of complaints from members of the public regarding fees charged by periti. In most cases, the situation arises because the periti involved do not inform their clients of the fees that will be charged for the services rendered.

Although the Council of the Kamra tal-Periti does not enter into disputes relating to fees charged by periti, in view of the fact that clients have other means of redress for such issues, the Council would nevertheless like to draw your attention to Regulation 20 of Tariff K of the Code of Organisation and Civil Procedure, which states that:

20(a)  The foregoing provisions of this Tariff shall not prohibit a Perit and his client, from agreeing on a fee, or the basis on which the fee is to be determined which is different from that established by this Tariff, and in any case the agreed fee or basis for determining it, not being a basis prohibited by law, shall apply, subject to the provisions of the following sub-paragraphs:

          Provided that in any case, a Perit shall inform his client of the applicable fee or the basis on which the fee is to be determined before the service is provided.

20(b)  For the purposes of this paragraph, an agreement concerning fess shall be in writing.

 

It is therefore, not only in your interest, but it is also your obligation to ensure that any agreement on fees is made in writing, and that the services covered by such fee are clearly outlined.

Please be guided accordingly.

 

Alex Torpiano
President

 

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DIR 01/15 | Drawings, Design Documents and Intellectual Property of a Perit

It has come to the Kamra’s attention that Periti are frequently facing demands by their Client/s to provide a copy of drawings or other design documents in digital editable format.

Drawings, illustrations and/or other design documents are the intellectual property of the Perit that prepared them and there exists no obligation to provide these to a third party save for the purposes of statutory requirements and provision of a printed copy to the Client.

Although the Clients reimburse Periti for their professional services, with respect to designs, drawings and other design-related documents created by the Periti, the Client is entitled solely to their use and acquires no other rights over them.

Although not obliged to do so, Periti may choose to provide a copy of the relevant documents to the Client in locked digital format (such as Pdf) but there exists no obligation to provide same in an editable digital format (such as dwg files) unless this is specifically established in the Agreement between the Perit and the Client, which Agreement must be in accordance with Article 20 of Tariff K.

In the event that a Perit does decide (voluntarily and without obligation) to provide a Client or any other relevant third party with copy of such documents in editable format, then he is within his rights in demanding whatever remuneration he considers appropriate, over and above any other remuneration received in respect of professional services rendered, save where this is precluded by Agreement as outlined in the previous paragraph.

In the case of surveys of existing property however, where the measurements are taken and the relevant drawings of the building or property in its existing state are prepared by the Perit, in this case alone, the Client has the right to request provision of such drawings in editable format from the Perit, given that such survey includes no additional input of creative design work or similar by the Perit and is merely a record of the existing state of affairs.

Christopher Mintoff
President

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DIR 01/10 | Amendments to the Tariff of Fees (Tariff K)

As you are certainly aware, your Council is currently in discussions with government on various issues that affect the profession. These issues, that formed part of a compendium titled “Towards a Renewed Profession”, were the subject of an Extraordinary General Meeting (EGM) held in April 2008 and the positions taken then were again reaffirmed, with some amendments, at the Annual General Meeting (AGM) of the 11th December 2009.

 

One of these issues concerns the Tariff of Fees, more commonly known as ‘Tariff K’. At the April 2008 EGM a revised Tariff of Fees was approved and this was forwarded to government with a recommendation that it should replace the current Tariff K.

 

At the same time that discussions were ongoing with the Ministry for Resources and Rural Affairs (MRRA) on aspects of the reform process, the transposition of the Services (Internal Market) Directive (Bill 32), which transposition had a direct bearing on Tariff K, was also being discussed. During these discussions it was made amply clear to the Ministry that the EGM of April 2008 had approved a revised Tariff of Fees and that it was the express wish of the Kamra and its members that this should replace the current Tariff of Fees.
To our surprise, in August 2009, we were informed by the Permanent Secretary at the Ministry that the Cabinet of Ministers, when discussing the transposition of the Services Directive had taken a unilateral decision to do away with the Tariff of Fees and liberalise the whole fee structure. We wrote back to the Permanent Secretary saying that we were in full disagreement with the position taken by Cabinet and requested that the latter is made aware of the Kamra’s position which was supported by an EGM of the Kamra and which position had already been made known months before to officials of the MRRA.
When the meetings with the Ministry resumed and the transposition of the Services Directive was being discussed, agreement was reached between the Ministry and the Kamra as to the way forward:

 

  • the revised Tariff of Fees as approved by the EGM was to replace the current Tariff;
  • the relative clause in Part VII of Bill 32 was to read as follows:
16 . Immediately after paragraph 19 of Tariff K in Schedule A of the principal law, there shall be added the following new paragraph:
“20 (a) The foregoing provisions of this Tariff shall not prohibit a Perit and his client, from agreeing on a fee, or the basis on which the fee is to be determined which is different from that established by this Tariff, and in any such case the agreed fee or basis for determining it, not being a basis prohibited by law, shall apply, subject to the provisions of the following sub-paragraphs:
Provided that in any case, a Perit shall inform his client of the applicable fee or the basis on which the fee is to be determined before the service is provided.
(b) For the purposes of this paragraph, an agreement concerning fees shall be in writing”.
  • In addition to the above another important clause of the same Bill was to read as follows:
14 (2) This Part shall come into force on such a date as the Minister responsible for justice may by notice in the Gazette appoint, and different dates may be so appointed for different provisions and different purposes thereof.
On the basis of the above and on the understanding that the bringing into force of sub-sections 16 and 20(a) and (b) would not occur before at least three (3) years from the publication of the Bill, the Kamra was happy to proceed. This had the full agreement of the representatives of the MRRA as well as the representative of the Ministry for Finance, the Economy and Investment. In fact the draft Bill that was presented at Parliament carried the full text as reproduced above.

 

To our immense disappointment, during the week commencing Monday, 25th January 2010 it came to our knowledge that the Bill as published in the Government Gazette of the 29th December 2009 did not reflect the above position as sub-section 14 (2) was amended and now reads as follows:
14 (2) This Part shall come into force upon publication of this Act.
Moreover, it was noted that the above sections, as amended, had already been incorporated as section 16 of Tariff K – Fees payable to Periti (Chapter 12 of the Laws of Malta – Code of Organisation and Civil Procedure). This effectively means that the fees that Periti can charge their clients for services rendered have been liberalised as from the 29th December 2009 and that it is the perit and his/her client that will set the level of the fee due, provided that such agreement is made in writing.
The Council of the Kamra is of the opinion that the wishes of the EGM of April 2008 and of the AGM of December 2009 have been totally ignored by government and that this goes contrary to the obligations outlined in Article 4 of Subsidiary Legislation 390.01 which states that “The Council of the Chamber of Architects and Civil Engineers (Kamra tal-Periti) shall correspond and consult with the Government and its various bodies and vice-versa on all matters concerning the profession or that may affect it in any way, as well as on other subjects of public interest”. We consider that the matter regarding fees to be paid to the perit is of fundamental relevance and of interest to both the profession and the public and that the respect and application of the intents of section 4 of the Subsidiary Legislation have been totally flouted.
I wish to inform you that the Council of the Kamra has discussed the situation at a formal Council meeting and has unanimously authorised me to write to the Prime Minister, expressing our disappointment at how the matter has been treated and requesting an urgent meeting with him. An appropriate letter was sent to the Prime Minister on the 3rd February 2010.
Depending on the outcome of the discussions with the Prime Minister it is our intention to hold an Extraordinary General Meeting of the Kamra.
In the meantime, whilst advising each Warrant Holder to familiarise himself/herself with the amendments that have been incorporated and enacted as part of Chapter 12 of the Laws of Malta, we are also obliged to draw your attention to the fact that clause 2 of the First Schedule of the “Code of Professional Conduct” is still binding as it has not been amended or repealed. This states that:

 

“A member is remunerated solely by his professional fees payable by his clients and/or by his salary payable by his employer. He is debarred from any other source of remuneration in connection with the works and duties entrusted to him. It is the duty of a member to uphold and apply the scale of professional charges payable to architects and civil engineers as per Tariff K of Schedule A to the Code of Organisation and Civil Procedure”

 

In this scenario and in order to avoid possible disputes with clients, it is important that:
  1. before any service is provided, the perit should inform the client of the applicable fee or the basis on which the fee is to be determined;
  2. irrespective of whether the scale of fees as set out in Tariff K is to apply, or whether a fee which is different from the scale of fees set out in the Tariff is to apply, an agreement in writing should always be entered into.
Following from the above, it is needless to state that failing an agreement in writing the scale of fees as set-out in Tariff K will automatically apply.
Finally we wish to draw your attention to the fact that the amendment to Tariff K became effective as from the 29th December 2009 and is not retro-active. In this respect, any commission entered into prior to that date should still be regulated, without fail, by the scale of fees as stipulated in Tariff K before it was amended.
The Council wishes to state that it has always recommended that the proposed reform process has to be treated in a holistic and consolidated manner, supported by a full consultation process, and not dealt with in a piecemeal manner as government seems set to adopt.
Vincent Cassar
President

 

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DIR 04/09 | Procedure for ‘Change of Architect’ and/or withdrawal from a commission

Directive Repealed

See DIR 04/22

Following the issue of MEPA Circular 03/09 and the subsequent issue of Chamber Directive DIR 03/09 dated 7 August and 10 August respective, representatives of the Chamber of Architects & Civil Engineers have met with the MEPA Chairman to discuss a number of issues associated with cases where a Client wishes to employ a second Perit to replace the one he/she had previously engaged and in cases where a Perit wishes to withdraw from a commission whether or not the Client has engaged a replacement.

Following the discussions held, it has been decided that with immediate effect, MEPA will revert back to the system as existed prior to the issue of its Cricular 03/09, dated 7th August 2009. Furthermore, and in order to improve the system and to avoid any misunderstanding, the following proceudres are to be adopted by all Periti:

  1. Termination by the Client prior to the Issue of a Development Permit
    The responsible Perit is to immediately inform MEPA of his withdrawal from the case and the subsequent relinquishing of all associated responsibilities, by means of a registered letter, with a copy to the Client and preferably also to the Chamber.
  2. Termination by the Client after the Issue of a Development Permit
    The responsible Perit is to immediately inform MEPA of the client’s instructions given to him/her and of his/her subsequent relinquishing of responsibility for any works beyond the indicated date, by means of a registered letter, together with copies of the said letter, preferably by registered mail to the Police Authorities of the locality where the development is taking place, the Local Council of the same locality, the Contractor, if applicable, to the Client and preferably also to the Chamber.
  3. Termination by the Perit originally engaged by the Client
    The Perit is to immediately inform the Client by means of a formal Withdrawal Notice sent by registered mail, declaring his resignation from the commission and relinquishing of associated responsibilities (save for works already carried out). If a permit a permit application is involved, the Perit is also to send a copy of the Withdrawal Notice to MEPA and if the permit has already been issued, further copies of the Withdrawal Notice are to be sent preferably by registered mail to the Police Authorities of the locality where the development is taking place, the Local Council of the same locality, the Contractor, if applicable, the Client and preferably also the Chamber.
  4. Taking over from another Perit
    Regardless of whether the commission of the original Perit engaged was terminated by the Client or by the said Perit himself/herself, the Perit engaged to take over, shall immediately advise the originally engaged Perit formally and in writing of his/her being requested to take over the commission. If a MEPA permit or application is involved, the second Perit shall approach the first Perit and request his endorsement on the appropriate ‘Change of Architect‘ form provided that it is either already endorsed by the Perit that is taking over, or the two hold a meeting and endorse the said form on the same occasion.

The Chamber of Architects and Civil Engineers is currently in consultation with MEPA in order to establish a mechanism through which MEPA, upon receiving the Notice of Withdrawal, will advise the Applicant/Client to terminate the works (if applicable) and appoint another Perit and furnish a ‘Change of Architect‘ form endorsed by both the incoming and the outgoing Perit within an established period of time in default of which the Application will be withdrawn or the Permit suspended.

Moreover, MEPA will be informing the Chamber of any instances where the Applicant/Client informs it that although he/she has requested the original Perit to sign the ‘Change of Architect‘ form the latter has refused, or is unwilling to do so and the Chamber will be referring all relevant cases for appropriate disciplinary action.

All Periti are to note that ‘Change of Architect’ forms should only be endorsed upon receipt of a formal request by another Perit and provided that either the form has been already endorsed by the Perit who is taking over or provided that a meeting is held between the two and endorsed by both on the same occasion. Moreover, all Periti are to inform their CLients of this accordingly. Periti are also to note that any pending issues between themselves and their Client, such as unpaid fees or similar, are not an admissible reason to withhold their handing over of a commission to a colleague and furnishing of the appropriate endorsed form.

Finally, the Chamber wishes to reiterate, as it has already done in previous directives, that it is a serious breach of the Code of Professional Conduct for a Perit to refuse to furnish his endorsement on a ‘Change of Architect’ form when requested to do so by a colleague who has been engaged to take over the works, provided that the said form has already been endorsed by the said colleague or that a meeting is held between the two to endorse the form on the same occasion. Moreover, it is also a serious breach of the Code of Professional Conduct for a Perit to take over a commission originally undertaken by a colleague without first informing the said colleague in a formal and appropriate fashion.

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