AN OVERVIEW OF CONSTRUCTION CONTRACT DISPUTES

Scott Orenstein
(203) 640-8825
CONSTRUCTION CONTRACT DISPUTE PRACTICE GROUP

During a construction project, many different types of disputes may arise between the parties.  A contractor may claim entitlement to additional contract time and/or additional compensation because of changed conditions, extra work, delay, acceleration, lost productivity, defective plans and specifications, and the like.  Similarly, an owner may claim damages for defective work and/or a contractor’s failure to complete the work on time.  In addition, the owner or the contractor may have reason to make claim against the project’s architect or engineer due to a deficient design and/or a failure to properly provide construction administration services.

Our Construction Contract Dispute Practice Group typically assists general contractors, construction managers, subcontractors and/or suppliers with any of the foregoing issues, but occasionally we assist owners and/or design professionals as well.

CONTRACT REVIEW

Today, having good, written contracts is a must.  No longer should anyone rely upon “handshake” or verbal contracts.  Verbal agreements are legally binding, but the lack of a written contract increases the potential that the parties may disagree upon their respective duties and obligations. 

What to Do When You Don’t Have Time to Wait for a Written Change Order

One of the most litigated construction law issues is whether a contractor is entitled to payment for additional work performed without a fully executed written change order.  Most construction contracts state that the contractor is not entitled to payment for any additional work, unless the additional work is performed pursuant to a written change order that has been sign by the owner, contractor and the architect.  The problem is that — because time is money — waiting for a signed change order is often costly so most contractors move forward with additional work based upon verbal agreements with the intention of executing a written change order at a later date.

Most of the time, no problems arise from having performed additional work without first having a written change order.  The parties abide by their verbal commitments, which are then incorporated into the written change order required by the contract.  Once in a while, however, an owner will refuse to issue payment for work that was performed without a written change order despite an oral agreement being reached during the project.  In these situations, some courts have enforced the contract provision requiring written change orders and have denied the contractor the right to recover payment for his work.