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The importance of change orders in construction contracts

On Behalf of | Jul 22, 2022 | Construction Law |

If there is one common denominator in most, if not all, construction projects, it would be the probability of change. For those overseeing the entire process, change orders require proper management and an effective strategy in place. Efficiency in assessing the need for change orders as issues arise that require a new direction.

Change orders usually equal more work. They occur for a variety of reasons and include:

  • Omissions and errors involving the original work scope
  • Construction drawings deemed ambiguous
  • Significant changes in site conditions
  • Potential building defects
  • Regulatory issues
  • Safety concerns

The importance of communication

Communication is key. The change order process cannot be within a bubble. Clients and subcontractors must be in the loop regarding the initiation and process. The owner or contractor decides the addendums or amendments to the original contract and overall work scope.

While open lines of communication are essential, attention to detail is paramount. Taking the time to read the documents carefully is important. Also vital is studying the clauses inherent in change orders that can include specific timeframe requirements to initiate the order and the agent authorized to approve the contractor’s changes.

Contracts are not always perfect. Many documents have language and clauses that conflict with each other, resulting in legal challenges. Of paramount importance is to take proactive steps to address the issues before they become problems that could result in catastrophic consequences.

The process of reviewing contracts and the change order process should work in tandem. Owners and architects must collaborate to avoid ambiguities, from drawings to outright admissions. Failing to do so can complicate an already complicated and expensive process.

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