Under an owner-architect contract that ties the architect's fee to the Cost of the Work, if CDs are completed but the project is abandoned with construction costs of $0, is the architect entitled to payment?

• A. No payment
• B. Payment only for design-phase services
• C. Payment based on the construction cost actually incurred
• D. Payment for all services performed because the fee is based on the Owner's budget for the Cost of the Work, not the actual Cost of the Work

Answer: (D)

When the architect’s fee is tied to the Cost of the Work, the amount due is determined by the Owner’s budget for that cost, not the actual construction expenditures. If construction documents are completed and the project is abandoned with construction costs at zero, the architect still earns payment for the services performed because the fee basis uses the budgeted Cost of the Work. The completed CDs represent the milestone reached and trigger the portion of the fee calculated from the budget, even though no actual construction occurs. In short, the abandonment doesn’t reduce the earned compensation because the contract bases the fee on the Owner’s budget for the Cost of the Work, not on real costs.