Contractor at Risk on Unit Price Contract Without Change Order
Kegler Brown Construction Newsletter September 1, 2009
Contractors on unit price contracts may not worry about change orders when the estimated bid quantity of a line item is exceeded, but perhaps they should. Typically contractors expect to be paid for the number of items provided so long as the owner’s representative verifies the quantity provided on a daily basis. However, a Seventh District Court of Appeals case has found that the public owner had no obligation to pay for any quantity that exceeded the bid estimate without a written change order. Seneca Valley v. Village of Caldwell, 156 Ohio App.3d 628 (2004).
This harsh result means that contractors on unit price contracts are at risk if they do not follow the express contract change order process when initial bid quantity items are exceeded.