A change directive is a way for the owner of a construction project – that is, the client – to instruct the contractor to perform additional work, beyond what was specified in the original contract.
It’s distinct from a change order, per se, in that it’s a demand rather than a request. That is, the contractor doesn’t necessarily have to agree in order to be bound to it.
You may be thinking: this sounds like a change order. It sounds very similar to changing order. The main difference is the changes are ordered by the customer and are contingent on the contractor to the agreement.
A change order is a mutual understanding, and both parties need to approve. Change directives aren’t an agreement to make a change – they’re mandatory.
“The contractor must follow the changes without any say in the matter. Change directives are also known as “force account work.””
A change order directive can often end up in a dispute and potentially in court. A change order directive could be a significant cost to a contractor since it’s outside the scope of work.
If A Contractor Disagrees with Construction Change Directives
Contractors are always looking for ways to make their projects more profitable and less risky, therefore they estimate closely enough to avoid future changes.
Change order directives are non-negotiable and can be costly to a contractor. Not only for the changes but depending on how extensive they are, it could delay other construction jobs. Creating a domino effect of issues.
So, what are your options? Below are the main options you have as a contractor with a change order directive:
- Agree to the change proposed by the owner. This could include the price and original timeline. It’s best to evaluate the cost before deciding. It could be a minor alteration that isn’t worth the trouble of disputing.
- Propose alternative changes to the change directive. If you have established a solid rapport with your client, try asking to negotiate. Explain your positioning and see how you can compromise.
- Disputing an issue with the change directive. You can make the changes but file a dispute after the work is completed.
- Leave the project and face the possibility of breach of contract. Not only is this a difficult decision but can ultimately be more costly.
The good news is that you have options. Our recommendation is to weigh all the options and consult a lawyer.
Legal disputes are not uncommon in the world of construction. When a contractor doesn’t agree to the terms, it may lead to a legal dispute. Especially for change directives since they’re mandatory.
The most common types of legal disputes due to change order directives in construction are:
- Dispute because contractor doesn’t agree to the terms
- Contractor not completing work on time or adequately and then refusing to fix it.
Legal disputes are the last resort. They can be time consuming and could bankrupt your business. Managing the relationship with your client and improving your change order management process can help prevent disputes.
Manage Change Orders Using Software
Change order tracking software can help manage all your change requests and change orders. It helps maintain documentation, track progress, and provide a central repository for all your changes as well as getting client approval.
Trak Changes makes the change order management process simple – helping you turn change orders from liabilities to assets. Ready to try? Begin your free trial today!
Simple, transparent pricing
Just like our product, our pricing is straightforward.
One price. Pay monthly. Cancel anytime.
No long contracts, no nickel and diming.
No credit card required