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Change Order and Change Order Disputes

Change Order and Change Order Disputes. By Mick Martin MRM Enterprises. Definition of Change Order :. A change order is essentially an agreement to modify the parties contract. In this respect a contract modification is binding so long as both parties consent to the change.

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Change Order and Change Order Disputes

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  1. Change Order andChange Order Disputes By Mick Martin MRM Enterprises

  2. Definition of Change Order: • A change order is essentially an agreement to modify the parties contract. In this respect a contract modification is binding so long as both parties consent to the change.

  3. What is a Change Order? Some common factors leading to change orders: • Delays • Specific Design Alterations • Lack of Coordination • Building code compliance

  4. What a Change Order is NOT: • Interpretation of General Concepts of the Contract • Device for Contractor or Client to get “Something for Nothing” • A way to get out of a screw-up • An after thought of specific work performed

  5. Get your Change Order in Writing • Verbal agreements are not binding on any party • Use specific language rather than general terms • Include signatures and dates of all parties • Copies to all parties

  6. Performance vs. Non-Performance

  7. Getting the Change Order Right • Opportunity to do a better job and make more money • Go above and beyond • Be fair • Communication is key

  8. Getting the Change Order Done • Expedite the work in a timely fashion according to contract / change order • Stick to the contract / change order • Make sure all workers are instructed as to the specifics of the change order • Get Paid

  9. Addition or Subtraction

  10. Add-ons (Additions) • Any addition to the original contract, addendum or amendment • Changing light bulbs to adding an east wing • Common sense is not always so common

  11. Knock-offs (Subtractions) • Any deletion to the original contract, addendum or amendment • Change in material, money or time • Always under promise and over deliver

  12. To Claim Or Not To Claim

  13. What is a Claim? • Request for adjustment of contract terms • Request for payment of money • Request for extensions of time

  14. Contract Dispute Process • Resolution • Mediation • Arbitration • Litigation

  15. Resolution • Resolve the claim without a 3rd party • Contractor and client come to an agreement • Work is performed – contractor is paid • Client is satisfied

  16. Mediation • Third party assistance in attempt at resolution • Non-binding • Mediator unbiased

  17. Arbitration • Provisions enforceable by statute • Inclusion of arbitration guidelines in construction contract

  18. Litigation • Involvement of the judicial system • Designed to produce accurate and fair outcome • Method can be costly and time consuming

  19. Obstaclesare those frightful things you see when you take your eyes off your goal” ~Henry Ford Inventor and Founder of Ford Motor Company

  20. Get It In Writing!

  21. Questions?? Thank you!

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