Q: Need help interpreting a construction proposal agreement
After project completion contractor want to charge extra for changes made during construction to meet code. The agreement states that "Any additions, alterations, or deviation to this proposal involving extra costs, will be executed only upon written orders and will become an additional charge over and above this proposal". However there was no discussion about the alteration or disclosure of the extra cost, nothing was written down concerning the issue other than a brief mention in an email. As an engineer, I see this as an oversight of the project designer and the engineer that signed off on the plans because they did not meet the building code, and think the should be responsible for covering that cost. Am I interpreting this correctly?
A: Dear Owner Facing Post-Performance Claim for Extra Contractual Payment: Your question has two areas of focus, the issue of a post-performance claim for Extra Payment and the potential pursuit of indemnity for the extra charges as against your Design Professionals. First, with regard to the issue of your Contractor requesting payment "after the fact": (a) the contract required the extra work to have been negotiated before performing it, (b) as does Colorado case law, and therefore (c) you could theoretically push back on the Contractors request for payment. However, before an attorney can recommend an actual advisable course of action, these further inquiries would need responses: (d) how much is the claim, (e) does it appear that the Contractor will Lien the job, and (f) do you have a kindly dispute mechanism in the contract such as Binding Arbitration. Presuming the claim is a significant amount then you'll need to examine your fortitude for litigating or arbitrating whereby you "defend" the claim from the Contractor and "cross-claim" for negligence against the Design Professionals. You could get out in front of the Contractor's claim by calling for meetings, issuing demand letters, and the like, in an effort to avoid litigation/arbitration. You may need to seek assistance from an experienced construction attorney to make recommendation for pursuit of a best practices strategy.
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