Construction Contracts - Change Orders
In a recent Appellate Division case, the Appellant Division discussed the interplay between direct contract interpretation as compared to work performed by a Subcontractor without a written Change Order. As has occurred many times in the past, the Court once again ruled in favor of strict contract construction instead of allowing arguments of equity to carry the day for the Subcontractor. In this matter, the Subcontractor failed to obtain a Change Order for site conditions which it believed differed from those pursuant to the original plans and specifications and performed work without receiving authorization pursuant to a written Change Order, and thereafter, attempted to bill for the increased costs. This claim was denied by the General Contractor, and thereafter, the Subcontractor sued for these increased costs. In ruling in favor of the General Contractor, the Court stated that the Contract must be strictly construed and if a written Change Order is required than no work must be paid unless this process is followed. The practical application of this case is that either a General Contractor or Subcontractor should follow the Contract carefully and obtain prior approval for any additional work instead of relying upon a clause in the Contract which may authorize said work without a Change Order. In other words, it is best to document rather than to guess.
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Question on change orders and subcontractors: Although our contract with our carpenter states that all change orders must be in writing, he did not do this but did the work. He and my husband discussed the changes on site, but the carpenter never wrote up change orders or submitted them to us to be paid. Now it's the end of the project and we've nearly reached the not-to-exceed contracted price but he's not finished with the job and refusing to work. Can he submit those change orders now, even though they will be in excess of the contract price and even though the work was done 3-4 months ago? He is refusing to finish the project, refusing mediation, so we are considering taking him to small claims court, but I want to be sure we understand the nature of change orders first. Also, he wrote our contract and it does not say that our contract is limited to what's on paper (implying, I think, that verbal agreements are contractual). Any advice would be appreciated.
Thanks.
The change order issue is entirely dependent upon what your contract says, as well as your course of dealing with the carpenter. I can discuss this with you if you like. I am not sure what the dollar value of your claim is. As such, it may or may not make sense for you to hire an attorney.