Construction and Commercial Real Estate Law

What are Change Orders in Construction Contracts?

contractors speaking to Philadelphia construction lawyer about a change order they do not want to comply with

When knee-deep in a construction project, the last thing you want is a curveball. But let's face it, in the world of bricks and mortar, change is as common as concrete. That's where change orders come into play, and boy, can they be a handful! You're not alone if you're scratching your head, wondering what these pesky change orders are about. Let's roll up our sleeves and dig into this together, shall we?


The construction lawyers at Davis Bucco & Makara have extensive experience handling construction cases. Call 610-238-0880 today for more information.  

What Are Change Orders? A Construction Lawyer's Perspective

Change orders are the chameleons of the construction world. They're formal amendments to your original construction contract that alter the work's scope, time, or cost. Think of them as the 'plot twists' in your construction story. You may have decided to add a fancy skylight to your office building, or unforeseen soil conditions throw a wrench in your foundation plans. Whatever the case, these changes need to be documented and agreed upon. That's where a construction attorney can be your best friend, ensuring every 'i' is dotted and every 't' is crossed.


Pro Tip: Always get change orders in writing. Verbal agreements are as sturdy as a house of cards in a windstorm.

The Anatomy of a Change Order: Breaking It Down

A well-crafted change order is like a recipe for success. It typically includes:


  • A detailed description of the change

  • The reason for the change

  • The impact on project cost

  • The effect on the project timeline

  • Signatures from all relevant parties


Understanding these components is crucial. A Philadelphia construction lawyer can help you navigate this process, ensuring every change order is clear, comprehensive, and legally sound.


Pro Tip: Keep a change order log. It's like a diary for your project, and it can be a lifesaver if disputes arise.


The Legal Implications of Change Orders: What You Need to Know

Change orders aren't just paperwork but legally binding modifications to your contract. This means they carry the same weight as your original agreement. A Pennsylvania construction attorney can help you understand the legal ramifications of each change order, ensuring you're not inadvertently agreeing to terms that could come back to haunt you later.


Remember, change orders can affect more than just the modified work. They can impact:


  • Project timelines

  • Overall budget

  • Resource allocation

  • Contractual obligations


Pro Tip: Before signing off on a change order, take a step back and consider its ripple effects on the entire project. A construction lawyer can help you see the big picture.

Handling Disputes: When Change Orders Lead to Disagreements

Sometimes, change orders can lead to more drama than a soap opera. Disputes can arise over the necessity of changes, cost, or impact on the project timeline. This is where having a Pennsylvania construction attorney in your corner can make all the difference. They can help mediate disputes, interpret contract language, and, if necessary, represent your interests in litigation.


Pro Tip: Address disputes early. Like a small crack in a foundation, ignoring a disagreement over a change order can lead to much bigger problems later.

Proactive Strategies: Minimizing Change Order Headaches

The best way to handle change orders is to minimize their necessity in the first place. Here are some strategies a construction attorney in Philadelphia might recommend:


  • Thorough initial planning and design

  • Clear and detailed construction contract documents

  • Regular project meetings to address potential issues early

  • Implementing a formal change order process


By being proactive, you can reduce the number of surprises during your project. It's like wearing a hard hat – it might not prevent all problems, but it sure can minimize the damage.


Pro Tip: Consider including a clause in your contract that outlines the process for handling change orders. It's like having a roadmap for when the unexpected occurs.


The Role of Technology in Managing Change Orders

Managing change orders doesn't have to be a paper chase in this digital age. Many construction lawyers are embracing technology to streamline the process. Project management software can help track changes, automate notifications, and maintain a clear audit trail. It's like having a virtual assistant to organize your change orders.


Pro Tip: When choosing project management software, look for options that allow for easy collaboration and real-time updates. Your construction lawyer can help you select a solution that meets legal requirements.

Change Orders and Project Success: A Delicate Balance

Change orders, when appropriately managed, can contribute to project success. They allow for flexibility and improvements as the project progresses. However, only a few changes can derail even the best-planned project. A skilled construction lawyer can help you strike the right balance, ensuring that necessary changes are accommodated without compromising the project's overall goals.


Consider this: According to a recent industry report, projects with well-managed change order processes are 25% more likely to be completed on time and within budget. That statistic should make any project manager sit up and take notice!


Pro Tip: Establish a change order review board for large projects. This group can evaluate proposed changes, ensuring they align with project goals and budget constraints.

The Financial Impact of Change Orders: Counting the Cost

Change orders can significantly impact your project's bottom line. It's not just about the direct cost of the changes; there are often hidden expenses to consider. A Philadelphia construction attorney can help you understand and negotiate these financial implications, ensuring that change orders don't turn your project budget into a runaway train.


Did you know? A 2024 study found that change orders account for an average of 8-10% of a project's total cost. That's a chunk of change that deserves serious attention!


Pro Tip: Consider including contingency funds in your initial budget to account for potential change orders. It's like having a financial cushion for when the unexpected occurs.

Communicating Change Orders: Keeping Everyone on the Same Page

Clear communication is the cornerstone of effective change order management. A construction lawyer can help you develop a communication strategy that keeps all stakeholders informed and aligned. This might include:


  • Regular project update meetings

  • Detailed documentation of all changes

  • Clear channels for submitting and approving change requests

  • Timely notifications to all affected parties


Remember, in the world of construction, surprises are rarely welcome. Keeping everyone in the loop can help prevent misunderstandings and disputes.


Pro Tip: Consider creating a change order flowchart visually representing the process from the approval request. It's like a roadmap that everyone can follow.

Frequently Asked Questions

  1. What is a change order in construction?

A change order is a formal amendment to a construction contract that alters the original scope, time, or cost of the work. It's a legally binding document that outlines modifications to the initial agreement.

  1. How do you handle a change order in construction?

Handling a change order involves documenting the proposed changes, assessing their impact on cost and timeline, getting approval from all relevant parties, and updating the contract accordingly. A construction lawyer can guide you through this process.

  1. Can you challenge a change order?

You can challenge a change order if you believe it's unreasonable or unnecessary. However, it's essential to do so promptly and in writing. A Pennsylvania construction attorney can help you navigate this process.

  1. What should be included in a construction change order?

A comprehensive change order should include a detailed description of the changes, the reason for the changes, the impact on cost and timeline, and signatures from all relevant parties.

  1. How can a construction lawyer help with change orders?

A construction lawyer can help draft and review change orders, ensure they comply with legal requirements, negotiate terms, resolve disputes, and advise on the potential implications of proposed changes.

Working with a Construction Law Lawyer: Your Partner in Project Success

Navigating the complex world of change orders doesn't have to be a solo journey. A skilled construction lawyer can be your guide, helping you avoid pitfalls and maximize opportunities. Whether you're dealing with a simple modification or a complex dispute, having legal skill set on your side can make all the difference.


Remember, change orders are a normal part of the construction process. With the right approach and professional guidance, you can turn these potential headaches into opportunities for project improvement and success.


So, are you ready to take control of your change order process? What steps will you take to ensure your next construction project runs smoothly, even when changes arise? The ball's in your court!


Experienced construction attorneys can protect your rights and interests in Pennsylvania when unresolved issues arise. Reach out today to schedule your initial consultation at 610-238-0880