Payment disputes are a common headache in construction projects, often stemming from poorly documented change orders. But by understanding the importance of proper documentation, contractors and project owners can avoid costly delays, strained relationships and even litigation.
What is a change order?
A change order is a written agreement between the contractor and project owner that modifies the original scope of work, price or timeline of a construction project. It is a necessary tool in an industry where unexpected site conditions, design changes and material shortages are common scenarios.
Risks of poor documentation, and how to avoid them
Without proper documentation, change orders can become a breeding ground for payment disputes. It can lead to an unclear scope of work, delayed payments, disputed payment amounts, delays in project completion, escalating costs and even litigation.
To avoid these risks, it is essential to properly document change orders. Here are some tips to help you do so:
- Use a standardized change order form
- Clearly define the scope of work and payment terms
- Obtain written approval from the project owner
- Keep a detailed record of all change orders and communications
- Regularly update the project schedule and budget
By following these steps, contractors and project owners can ensure that there is a proper record of all the changes in the project. This reduces the risk of payment disputes and ensures a successful project outcome.
Do not let payment disputes derail your project
If you are facing a payment dispute or need guidance on documenting change orders, it is crucial to seek legal counsel experienced in construction law in Florida. With the right guidance, you can protect your interests and avoid costly mistakes.
