Question 1

What is a construction change order and which AIA form governs?

Accepted Answer

A construction change order is a written, bilateral amendment to an existing construction contract that modifies the scope, price, or schedule. The industry-standard form is AIA G701 Change Order, signed by owner, contractor, and (where the contract uses architect administration) the architect. Change orders ordinarily fall into three categories: owner-directed scope changes, latent or differing site conditions under AIA A201 § 3.7.4, and design errors or omissions for which the design professional carries E&O liability under AIA B101. Most construction contracts include a no-oral-modification clause that requires every change to be documented on G701; courts enforce these clauses under the parol evidence rule, denying recovery for unwritten extras (Dobler v. Story, 197 P.2d 200 (Cal. 1948); see also Restatement (Second) of Contracts § 213).

Question 2

Why does the change order have to be in writing?

Accepted Answer

Three reasons. First, the contract requires it. AIA A201 § 7.2 conditions extra compensation on written authorization, and most state-form home-improvement contracts include parallel no-oral-modification clauses. Second, the Statute of Frauds in many states requires construction modifications affecting real-property improvements to be in writing where the original contract was. Third, evidentiary risk: oral change orders generate the largest single category of construction litigation. The contractor claims the owner verbally approved $15,000 of extra work; the owner denies it. Without a signed G701, courts typically deny recovery unless the contractor can prove waiver of the no-oral-modification clause, course-of-performance, or quantum meruit, all difficult and expensive to litigate.

Question 3

How is change-order pricing calculated?

Accepted Answer

AIA A201 § 7.3.3 enumerates four methods. (1) Mutual lump-sum: the parties negotiate a fixed price. (2) Unit prices: the original contract states $X per linear foot of trench, $Y per electrical outlet, and the change order multiplies units by rate. (3) Cost of work plus a fee, with the contractor's markup capped (10 to 15 percent on direct work, 5 percent on subcontractor work is typical). (4) AIA Construction Change Directive (G714): the architect determines a reasonable amount if the parties cannot agree. The change order should itemize labor hours at agreed rates, material quantities and unit prices, subcontractor quotes, equipment rental, bond and insurance premium adjustments, and the markup. Several states cap markup on residential change orders (Maryland MHIC limits markup on change orders for code-compliance work).

Question 4

Can the owner refuse to sign a change order?

Accepted Answer

The owner may decline scope additions and the original work proceeds unchanged. Where the change addresses a differing site condition under AIA A201 § 3.7.4, the contractor may stop work in the affected area until the dispute is resolved and is entitled to a time extension under § 8.3. Where the change corrects a design defect, the design professional carries first-line E&O liability under AIA B101 § 8.1.1; the owner may have a recovery action against the architect or engineer. If the owner refuses a change order necessary to complete the contract scope, the contractor may suspend work after the notice period in A201 § 14.1.1 (typically seven days) or terminate for cause. Liquidated-damages clauses do not run against the contractor for delay caused by owner refusal.

Question 5

Change order versus change directive: what is the difference?

Accepted Answer

A change order on AIA G701 is bilateral: owner and contractor agree on scope, price, and time before the work proceeds. A construction change directive on AIA G714 is unilateral: the owner directs the contractor to proceed with changed work immediately while pricing is deferred. CCDs exist for true urgency, such as concealed conditions that must be addressed to avoid additional damage. Under A201 § 7.3, the contractor must proceed with the directed work, maintain time-and-materials records under § 7.3.6, and submit a claim for adjusted compensation. If the parties cannot agree on price, the architect issues an interim determination under § 7.3.9, subject to dispute resolution under Article 15 (mediation followed by arbitration or litigation per the contract's election).

Question 6

How do change orders affect the project schedule and liquidated damages?

Accepted Answer

Every change order should state the time impact in calendar or working days and identify the new substantial-completion date. AIA A201 § 8.3.1 entitles the contractor to a time extension for delays caused by owner acts, changes in the work, or differing site conditions. The analysis turns on critical-path-method (CPM) scheduling: only changes affecting tasks on the critical path extend the completion date. Liquidated damages under § 8.3.3 do not run for excused delays documented by approved change orders. The contractor must give written notice within 21 days of the event under § 15.1.3.1 to preserve the claim. Failure to give timely notice can waive the time extension under the no-damage-for-delay clauses enforced in many jurisdictions (United States v. Spearin, 248 U.S. 132 (1918); Triple R Paving v. Broward Cnty., 774 So. 2d 50 (Fla. 4th DCA 2000)).

Question 7

Should change orders be numbered and logged in a register?

Accepted Answer

Yes. Sequential numbering (CO-001, CO-002) supports the contractor's records under AIA A201 § 7.3.7 and the AIA G703 continuation sheet on each pay application. The register should track: the original contract sum, cumulative additions and deletions, the adjusted contract sum, the original substantial-completion date, cumulative time extensions, and the revised substantial-completion date. On public-works jobs, the register often must be submitted to the owner with each AIA G702 Application for Payment to support draws under the bond. Surety underwriters (Travelers, Liberty Mutual, Zurich) require change-order logs as part of bond-claim documentation. Lenders financing the project under AIA G702/G703 draw schedules require the same.

Question 8

What happens if the contractor performs changed work without a signed change order?

Accepted Answer

The contractor's recovery is at risk. AIA A201 § 7.2 conditions extra compensation on written authorization. Where the contract requires writing and none exists, courts generally deny breach-of-contract recovery and force the contractor to plead quantum meruit, requiring proof that the owner knowingly accepted the benefit and that the reasonable value equals the claimed amount. Some states bar quantum meruit recovery where the original contract is governed by a home-improvement statute that requires writings (California BPC § 7159; Maryland Bus. Reg. § 8-501). Contractors should refuse to perform extras until G701 is signed, or at minimum issue a written notice under § 15.1.3 reserving the claim. Owners benefit from the same rule: refuse to pay for extras lacking a signed change order.

Component	Purpose	Details
Change Order Number	Sequential tracking	CO-001, CO-002, etc. for audit trail
Description of Change	Documents scope modification	Detailed description of added, removed, or modified work
Reason for Change	Categorizes the cause	Owner request, unforeseen condition, design revision
Cost Breakdown	Itemizes price impact	Labor, materials, subs, equipment, markup, running total
Time Impact	Adjusts the schedule	Days added/subtracted, new completion date
Contract Summary	Shows running totals	Original price, total COs to date, adjusted contract price
Supporting Documents	Provides evidence	Photos, sketches, subcontractor quotes, specifications
Signatures	Authorizes the change	Owner and contractor signatures with dates

Free Construction Change Order Forms

What Is a Construction Change Order?

Differing site conditions and the Spearin doctrine

No-damage-for-delay clauses and time impact

Scope Changes

Price Adjustment

Timeline Impact

Change Order Form Preview

Construction Change Order

Key Components of a Change Order

Markup caps and cost-of-the-work definitions

Retainage release on completed change-order work

How to Issue a Change Order

Notice of claim within 21 days

Identify and Document the Change

Price the Changed Work

Assess Timeline Impact

Submit for Review and Approval

Obtain Signatures

Frequently Asked Questions

Official Resources

Create Your Change Order