INTERIM PAYMENTS FOR BASIC FEE Clause Samples
The 'Interim Payments for Basic Fee' clause establishes the right for a party, typically a contractor or service provider, to receive partial payments for work completed before the entire project or service is finished. In practice, this means that instead of waiting until the end of a contract to be paid in full, the provider can submit invoices at agreed intervals—such as monthly or upon reaching certain milestones—for portions of the basic fee corresponding to work performed to date. This arrangement helps maintain cash flow for the provider and reduces financial risk, while also giving the client a mechanism to monitor progress and ensure payment aligns with actual work completed.
INTERIM PAYMENTS FOR BASIC FEE. 7.2.1 The Owner shall make interim progress payments to the Professional on account of the basic fee under Article 6 as indicated in the following Subparagraphs when the total Owner-approved construction cost estimate is in excess of five million dollars ($5,000,000.00).
7.2.2 Prior to completion of the Design Development Phase and at the approximate midpoint (1/2) of the Design Development Phase, a sum equal to twenty percent (20%) of the basic fee, less any previous payments, computed upon an Owner approved estimate of construction cost, shall be due. The Owner shall be the sole judge as to whether the Professional is at the mid-point (1/2) of the Design Development Phase and due the interim payment.
7.2.3 Prior to completion of the Construction Document Phase and at approximately one third (1/3) of the Construction Document Phase, a sum equal to forty percent (40%) of the basic fee, less any previous payments computed upon an Owner approved estimate of construction cost, shall be due. The Owner shall be the sole judge as to whether the Professional is at the one third (1/3) point of the Construction Document Phase and due the interim payment.
7.2.4 Prior to completion of the Construction Document Phase and at approximately two thirds (2/3) of the Construction Document Phase, a sum equal to fifty percent (50%) of the basic fee, less any previous payments computed upon an Owner approved estimate of construction cost, shall be due. The Owner shall be the sole judge as to whether the Professional is at the two thirds (2/3) point of the Construction Document Phase and due the interim payment.
7.2.5 The Professional shall prepare and submit to the Owner sufficient sketches, drawings, written material, product information, calculations, and estimates to enable the Owner to determine, without doubt, that the Professional is at or beyond the point of work necessary to receive interim payments. The Owner is the sole judge of the sufficiency of the submitted material. The Professional shall submit simultaneously the data required to the institution or agency and to the Owner.
7.2.6 The Professional shall continue the work on the specific phase during the review of the interim payment request. Project work shall not stop because phase approval has not been given. The only result of the submittal will be payment of the specified interim payment amount.
7.2.7 The payment of interim Design Development Phase or Construction Document Phase requests in no way approves an...