Contracts are very important in the construction industry. You would find it very difficult to make it through even a day without contracts. However, even the best-laid plans can go a little off track when it comes to this industry in New Jersey. That is why change orders are so common, and disputes around change orders are just as common.
The American Bar Association explains that many contractors put change order clauses in every contract that spell out what will happen if a change order needs to occur. Laying out the process in this manner can help make things a little smoother, but it does not always mean you will avoid disputes.
A change order will help you when the work you need to do changes from the original scope. The other party to the contract may make a change order necessary by requesting changes to the original design or adding on things that were not in the original bid. Because a change order will usually lead to an increase in the cost of a project and because it always changes the scope of the work, it requires agreement from both you and the other party.
When a dispute occurs, the most common reason is the other party trying to say the change made was not an actual change. They want to claim it falls under the original scope of work. Obviously, if the change increased the amount the other party owes to you, this is a serious issue that you want to handle as soon as possible.
The best defense against a dispute of a change order is to pull out the documentation. Always document every change and make sure you have the other party sign off. This can protect you and make it easy to clear up disputes. This information is for education and is not legal advice.