Written by Trisha Karkhanis
Exploring contracts in large-scale projects, EmAGN’s most recent Talk to Me series, ‘Talk Novated D&C to Me’, unpacked one of Australia’s most common procurement models: Novated Design and Construct (D&C). The discussion revolved around the practical realities of D&C contracts, and discussed the benefits, challenges, common misconceptions, and key ingredients for its success. Trisha Karkhanis provides a summary of the key takeaways from the event below.
On 8th April, EmAGN’s latest Talk to Me series – ‘Talk Novated D&C to Me’ brought together a potluck of professionals from architecture, construction, and risk management services featuring speakers from ARCH, Ireland Brown Constructions, and Informed by Planned Cover. The EmAGN cohort gathered at the Sculptform Design Studio with pens in hand to learn about Novated Design and Construct contracts. Through diverse shared perspectives on this procurement method – and how it influences project delivery, design outcomes, and collaboration – attendees left feeling more informed and confident as graduates and emerging architects stepping into novated D&C contracts.
What is novation?
Put simply, novation is a legal transfer of a contract. In traditional procurement, architects are directly contracted by the client and act as the superintendent throughout the project. In novated D&C contracts, the contractual relationship shifts: “the original client-consultant agreement is replaced by a builder-consultant agreement,” explained Informed by Planned Cover’s manager of Risk Services, Wendy Poulton.
This shift is formalised through a Deed of Novation – a document outlining changes in liability, payment, and project direction. As the project manager at Ireland Brown Constructions, Ben Pakulsky noted, “this deed can also be embedded in the original consultancy agreement, with a clause triggering it, for example, upon signing the building contract.”
“While architects often have limited power in deciding the timing or structure of novation, it helps if all parties are on the same page for a smooth transition and shared understanding of roles and responsibilities moving forward,” emphasised associate at ARCH, Nicole Eadie.
The Benefits of Novated Design & Construct
Late novation, usually at the end of design development, potentially allows for a well-resolved design; it reduces early compromises and maintains a stronger client-architect relationship during key stages of projects. Eadie however spun the conversation to showcase how early novation can often bring its own advantages as well. Stronger collaboration and transparency between the architect and builder from the outset equips the design with builder input, improving buildability, and reducing the extent of value management later on. Pakulsky added how “early contractor involvement can help resolve construction challenges upfront, leading to cost and time savings.”
The Recipe to A Successful Novated Design & Construct.
Whether using traditional or novated contracts, the success of a project depends on the strength of the team. Poulton pointed out that “a good team is almost a precondition for success. Without it, even the most carefully planned projects can fall apart.” Other key ingredients include transparent communication through strong relationships, detailed performance specifications, and maintaining focus on the project’s core values.
Ingredient 01 – A Strong Architect-Contractor Relationship
All three speakers agreed that the architect-contractor relationship is influential in a novated D&C model. Understanding the contractor’s priorities – cost, time, and quality – helps maintain clear and effective communication. As Eadie explained, “once novation occurs, contractors can make decisions without the architect’s input, putting the relationship to test to protect design quality.”
Pakulsky, from a construction manager’s viewpoint, noted that contractors often have limited time during the tender phase to assess all risks. “Many risks only emerge during construction and are then transferred to the contractor,” he shares. Pakulsky stressed that it’s “not always about cutting corners, but about navigating tight timelines, budgets, and risk.”
Ingredient 02 – Clear Performance Specifications
A weighty success factor in Novated D&C is the use of clear, well-defined performance specifications. Eadie illustrated this with a playful example; “imagine specifying an elephant with a purple trunk balancing on a ball. While vivid, the ball could be anything from marble to plastic,” she shared, noting how “without clear descriptions of materials, function, and intent, specifications become grey areas that are open to change.”
To avoid this, performance specifications must be precise to minimise misinterpretation post-novation. It was also discussed how upholding specifications often requires a robust rationale and the confidence to back your decisions. Eadie reminded the group (and yes, you’ve heard this in university) that drawings and presentations must speak for themselves – clear, intentional, and able to stand alone even when passed along without explanation.
Ingredient 03 – Non-Negotiables
Successful value management hinges on identifying which design aspects are essential and which are flexible. “These non-negotiables should be clearly outlined at kick-off meetings to establish the project’s core values,” noted Pakulsky. He also added that “contractors often operate under client direction and may not fully appreciate the value of design, but having a list of ‘non-negotiables’ and ‘nice to haves’ helps manage expectations and assists trade-offs.”
When asked what their non-negotiables were, Poulton immediately chimed in. “Designing according to the NCC is a non-negotiable, and this is an exception to cutting costs in the name of budget,” she said. Eadie admitted that, quite often, majority of the design is ultimately negotiable, but the only things that hold defined weight are regulations and ‘inconsequential-consequential’ design decisions – such as the difference between timber grades or research-backed performance solutions. She added that “it’s not about being right or wrong but having a sound reason. So don’t argue about things that don’t matter – let it go!”
Novated Design & Construct is a complex but manageable pathway that relies on clarity, collaboration, and confidence. “While the architect’s role changes post-novation, their duty to design integrity and compliance remains,” shares Poulton. All three speakers emphasised that success lies in setting clear expectations early, maintaining strong relationships, and staying engaged throughout. With open communication, a realistic tender, and a committed team, quality outcomes can be achieved without compromising on design.
Speakers:
Chaired by Alistair Nancarrow – Associate Architect at MGS Architects
Ben Pakulsky – Project Manager at Ireland Brown Constructions
Nicole Eadie – Senior Architect & Associate at ARCH
Wendy Poulton – Manager of Risk Services at Planned Cover
Bio:
Trisha Karkhanis works as an Architectural Graduate at Particular Architects and is a member of the EmAGN VIC committee.
This article was produced by the EmAGN Media subcommittee.
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