By Lauren White, RCS Reporter.
It’s common for construction projects to encounter delays and changes from the initial plan, such as a timeline adjustment due to weather conditions. However, some owners request alterations that are so substantial, the product the contractor is trying to produce gets changed significantly. Cotney Construction Law explains that, “They may do this in the form of a construction change directive and place the financial burden of the change on the contractor.” Lawyers can assist in situations like these and explain what your options are.
These considerable changes are called cardinal changes. A cardinal change occurs when, “the purpose of the original agreement has been frustrated or made impossible by the extent of the requested change,” Cotney Law shares. These changes expose contractors to a precarious position financially and leave them vulnerable. This is due to them, “...being directed to perform a significant task that was not a part of the original agreement without any assurance that they will be compensated,” Cotney Law discloses
There is a doctrine that is specifically for contracts facing this situation. The cardinal change doctrine, “...is a response to an owner’s ability to make significant changes to a construction project’s scope of work,” Cotney Law reveals. Because of this doctrine, if a contractor believes an owner is trying to authorize a cardinal change to the project scope, the contractor has the ability, and the right, to walk away from the contract.
A contractor would not be breaching the contract and would be able to file a claim for damages if the cardinal change is proven. However, the contractor could be in violation of the contract themselves if they are unsuccessful in proving the cardinal change was requested.
There are three items courts look for when determining if a cardinal change claim is valid or not. Cotney Law shares the three criteria: “a significant increase in the amount of work that needs to be completed, a significant alteration to the type of work that needs to be completed, [and] a significant change in project costs.”
Cardinal changes can be challenging to prove, which is why it’s important for contractors to document the entirety of what occurs on the job site. Cotney Construction Law also encourages contractors to examine their options when it comes to dispute resolution.
Consult an experienced construction attorney like Cotney Construction Law to help when cardinal changes issues arise.
Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.