Change Orders are as common to construction as lawsuits are to lawyers.
But the process for dealing with them, when there is no agreement, can vary widely. And yet, the first thing you should do when encountering a change is almost always the same – READ THE CONTRACT.
Now that you have the contract in front of you, ask yourself these questions:
- What Notice is Required?
Almost all contracts require timely notice and the results can be harsh for those that do not provide proper notice.
- What Documentation is Required?
Often, contracts will not simply require written notice before additional work takes place, but also that you provide documentation or support for your claim or change order, and the associated costs, within a certain number of days after initial notice is provided.
- Must a Change Order be Signed before Work Proceeds?
Most contracts now provide that a signed change order must be received before additional work takes place, but this rarely occurs. So, it is good to point out that you are being directed to perform the work immediately, with the anticipation that a formal change order will be forthcoming.
- Can you Refuse to Perform the Requested Change?
You might refuse to do the additional or changed work without an approved change order. But, most contracts provide that you can be directed to proceed with the alleged change and you have to do so, even if you can fight about entitlement and damages later.
- If the Change is Disputed, How Can you Protect your Rights?
If both sides cannot agree that a change order is warranted, or the amount it should cost, it is important that you note that you are doing the changed work under protest, and that you reserve the rights to recover additional costs associated with the directed change.
If you ask yourself these five questions early on after a change is discovered, you can be in a better position to recover additional time or money associated with work outside your original scope of work.