{"id":267,"date":"2012-01-18T14:53:29","date_gmt":"2012-01-18T21:53:29","guid":{"rendered":"https:\/\/www.myconstructionexpert.com\/blog\/?p=267"},"modified":"2012-01-18T14:53:29","modified_gmt":"2012-01-18T21:53:29","slug":"another-reminder-on-change-orders-dont-worry-about-payment-for-extra-work-is-not-enforceable","status":"publish","type":"post","link":"https:\/\/www.myconstructionexpert.com\/blog\/another-reminder-on-change-orders-dont-worry-about-payment-for-extra-work-is-not-enforceable\/","title":{"rendered":"Another reminder on change orders: \u201cdon\u2019t worry\u201d about payment for extra work is not enforceable"},"content":{"rendered":"

William R. Mauck, Jr. – January 10, 2012<\/p>\n

The importance of following change order provisions in a construction contract was emphasized yet again in a recent federal court decision:\u00a0\u00a0Carolina Conduit Systems, Inc. v. MasTec North America, Inc.<\/em><\/p>\n

In this case, Carolina Conduit, a subcontractor, sued the general contractor, MasTec, for the cost of installing additional flowable fill due to a change in the configuration of duct banks.\u00a0 Although the design documents called for the duct banks to be constructed in a vertical configuration, field conditions required that the duct banks be built in a horizontal configuration, necessitating additional flowable fill.\u00a0 Upon this discovery in December, 2008, Carolina Conduit\u2019s president and project manager met with MasTec personnel, who informed Carolina Conduit \u201cnot to worry\u201d about the additional fill and costs because plenty of funds were available.\u00a0 Carolina Conduit proceeded to work on the project throughout the following spring.\u00a0 In May, 2009, Carolina Conduit\u2019s president again discussed the extra cost of the duct banks and MasTec\u2019s vice president again advised \u201cnot to worry\u201d and that Carolina Conduit would be compensated.<\/p>\n

At the close of the project, MasTec refused to pay Carolina Conduit for the extra flowable fill.\u00a0 After suit was filed, MasTec requested the court to grant it summary judgment and dismiss the claim for extra flowable fill.\u00a0 MasTec asserted, among other things, that the parties\u2019 contract contained a provision governing changes to the scope of work:\u00a0 \u201cany additional work outside the original scope of work shall be handled through a change order specifying pricing and\/or Unit prices approved by [the Owner].\u201d<\/p>\n

In opposing summary judgment, Carolina Conduit argued that the contract\u2019s requirements were ambiguous, and that the parties had modified the contract, either by oral agreement or in their course of dealing.<\/p>\n

The court ruled in MasTec\u2019s favor while succinctly stating Virginia law applicable to change order provisions:<\/p>\n

Virginia law provides that contractual provisions containing written change order requirements are binding upon the parties to the contract . . . .\u00a0 Contractual provisions requiring written change order requirements maintain order and predictability in the construction business, and are meant to avoid subsequent disagreement and prevent controversy . . . .\u00a0 For this reason, where there is a method under the contract by which a party can insure the recovery of the cost of extra work, that party is not entitled to recovery where it fails to follow that method.<\/p>\n

The court held that since Carolina Conduit failed to follow the change order provision, it could not recover any excess cost.\u00a0 The court rejected the argument that the design was ambiguous, again noting that regardless of that assertion, Carolina Conduit did not follow the change order provision.<\/p>\n

The court also quickly disposed of Carolina Conduit\u2019s argument that the parties had modified the change order provision.\u00a0 The court determined that MasTec\u2019s statements \u201cnot to worry\u201d about additional cost were not sufficient to prove that MasTec had waived the change order requirements.\u00a0 The court also noted that Carolina Conduit submitted multiple change orders during and after the close of the project on other issues which contradicted the argument that the parties had waived the change order provision.\u00a0 Finally, the court noted that Carolina Conduit could point to no instance where MasTec ignored the change order provision; hence, there was no evidence of course of dealing indicating a modification to the change order requirements.<\/p>\n

This case marks the second time in a year that a federal court applying Virginia law has ruled against a subcontractor who failed to follow a contract\u2019s change order provision.\u00a0\u00a0See Artistic Stone Crafters v. Safeco Ins. Co<\/em>., see also WM Construction Alert, 10\/13\/2010, \u201cStone Crafters, Inc. v. Safeco Insurance:\u00a0 A Reminder of the Importance of Lien Waivers and Change Order Provisions.\u201d\u00a0\u00a0\u00a0View Williams Mullen Alert<\/a><\/p>\n

General contractors and subcontractors alike must regularly and systematically follow their contract procedures for obtaining change orders and, in the event change orders are refused, must strictly follow the contract\u2019s provisions for preserving and making claims.<\/p>\n","protected":false},"excerpt":{"rendered":"

William R. Mauck, Jr. – January 10, 2012 The importance of following change order provisions in a construction contract was emphasized yet again in a recent federal court decision:\u00a0\u00a0Carolina Conduit Systems, Inc. v. MasTec North America, Inc. In this case, Carolina Conduit, a subcontractor, sued the general contractor, MasTec, for the cost of installing additional… Continue reading Another reminder on change orders: \u201cdon\u2019t worry\u201d about payment for extra work is not enforceable<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","enabled":false},"version":2}},"categories":[9],"tags":[90],"class_list":["post-267","post","type-post","status-publish","format-standard","hentry","category-construction-contracts","tag-change-orders","entry"],"jetpack_publicize_connections":[],"yoast_head":"\nAnother reminder on change orders: \u201cdon\u2019t worry\u201d about payment for extra work is not enforceable - Advise & Consult, Inc.<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.myconstructionexpert.com\/blog\/another-reminder-on-change-orders-dont-worry-about-payment-for-extra-work-is-not-enforceable\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Another reminder on change orders: \u201cdon\u2019t worry\u201d about payment for extra work is not enforceable - Advise & Consult, Inc.\" \/>\n<meta property=\"og:description\" content=\"William R. 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