Changes on construction projects are inevitable, especially with the reality of projects during and after the COVID-19 pandemic. Due to this inevitability, owners should consider including contingency in the budget to deal with change orders. Accounting for legitimate changes quickly and obtaining an agreement that the payment fully resolves the issue can limit larger disputes down the road. Unresolved change orders often result in disputes that end up with legal expenses that could have been avoided. Here are some basic steps to take to make the process easier regardless of the scope of the requested change.
- Know your project specifications and contract.
Is the proposed change order actually changing the scope of the work? To know this answer, you must be familiar with the specific type of change requested. Identify with as much specificity as possible the original requirements and the changes needed.
- Know the requirements for changes under your contract.
Who is to provide notice of the change? Does the change need to be reduced to writing? There is a detailed procedure in your contract. Complying with your contract is essential for a positive outcome, including prompt notice and detailed, written descriptions of the changes made at or near the time the changes were approved.
- Document the work.
As always, you should document your project status. The changed work must be tracked and recorded in detail. Daily logs and photographs are two of the best forms of documenting this progress. Create a system by which each change is organized separately, including the progress associated with each change.
- Involve others.
If you need assistance in analyzing your contract and developing best practices for work changes and requests, the attorneys at Lamson Dugan & Murray LLP can assist to optimize your chances to avoid later disputes. Many disputes, and the legal fees that result, can be avoided with proper preparation. It is almost always far less expensive to prevent these disputes than to take the approach that you will handle any problems as they arise.
This article was written by Andrew Wilkinson.