On Nov 2, 7:07 am, Swingman wrote:
CHANGE ORDER – COST PLUS

* SNIP *

Get a cup of coffee... this is a long one.

A couple of thoughts....

All valid points in the post Karl, as are the points preceding. On my
master contract (going from memory - not at my own computer) I have
another caveat that is somewhere in this neighborhood:

"While this Change Order affects the original scope of work and its
cost, it does not affect the Terms and Conditions of the original
Contract. All Terms and Conditions of the original Contract, unless
otherwise specified within this Change Order will be observed and in
effect as agreed to by both parties as if no modifications had been
made to the original Contract."

My contract delineates that "The Scope of Work to be Performed" has
all the details, including time needed to perform the work. It
includes the cost of work to be performed as well as materials needed
to perform the work.

When I built anything of substance, I kept a book of finish selections
and spelled out where each paint color went, each tile selection, each
bit of wallpaper, carpet, wood floor, deck stain, counter tops, etc.
This book of finishes became part of the contract by reference to "see
finish selections". My paint suppliers are required by me (now they
are printed automatically) to write the paint number on each can
received to match up with the book. Same with wallpaper, etc. I made
a copy for the client, but kept the original with their initials and
date under each selection under every selection.

My biggest problem when building a house (only built 5) was the people
changing their minds about finishes and colors. (I ran back screaming
to commercial my first chance to get away from houses.)

The Terms and Conditions part of my contract specify where to pay,
when to pay, and *a lot* of language warning the client that under no
circumstances will they screw around with me or our agreement. It has
the standard exculpatory language to protect me, but it also sets for
that if I have to hire any kind of help for payment, they will pay not
only the amount invoiced, but all related fees required to collect
including MY time.

(As a sidebar, I have tested this clause. I can recover the amount
needed to collect such as attorney's fees, etc. I was not allowed to
collect money for my time in that particular case because it wasn't an
exorbitant amount and the judge decided that should be part of my cost
of doing business.)

I found it necessary to add the "from memory clause" above into my
contract as an attorney friend of mine reviewed my contract and told
me that would be a good idea since **technically** I had changed the
contract without limiting the scope of change.

Think about it.... yes, we agreed to the add on, and its cost. Yes,
we agreed it increased the price. We further spelled out the time
needed to complete the specified work.

But... did we agree to the same exculpatory language? Did we spell
out the exact method and time of payment and what would happen if
those tenets weren't observed? In the case of any overlapping work
touched on by the contract, was/is it reasonable for the client to
assume that the new work would be treated differently in any way other
than specified in the contract? Will you have to listen to the
dreaded "oh... I didn't understand that... I thought this was
separate". Since it is more money, how will it affect the pay
schedule? You need to make sure the additional work and additional
money are completely protected.

You get the drift.

Over the years I have seen so damn many of my contracting amigos take
it in the shorts because they didn't have the legal experience to
fight off an unruly client. One of them in particular had trouble
with a client that paid the contract amount for work just fine, but
since the terms and conditions of payment for the change orders
weren't spelled out, the judge chastised him in small claims court for
not spelling out the terms of payment. That judge considered the
change order (careful to point out this out here; it was an ADD ON,
NOT a modification like a paint color change) to be a completely
different issue, and a completely different contract. Sadly, one with
no teeth for my amigo. The judge told my amigo that he thought the
change order resembled an invoice, not a component of a larger
contract.

While every attorney will look at any contract and tell you they can
break it easily, I haven't had one of mine broken yet. I am diligent,
and I have been tested.

But the amount of paper work and contractual expertise we have to have
these days to do the smallest thing is amazing to me.

One thing I have found out though; if you have a client that is going
to screw you, no amount of paperwork and legal blather will save you.
Nothing will. You will get screwed.

All a good contract does is to keep everyone on the same page, remind
them of what was agreed to, and to provide reference for how the job
is to be handled.

There is an attorney here in town that has something like 14 liens
against his home.... and he has another group of judgments as well.
He is legendary, and he does well until he has someone like me that
files a mechanic's lien against the house BEFORE I start a major
remodel, and modify it along the project time line.

When he finds someone like me (he hasn't found me, though!) he is
screwed. But there are plenty of guys ready to jump into the briar
patch with him.

I still remember when I did 99% of my business on a handshake. Man,
does that seem like a eon ago now.

Robert