Constructive Change Directive Clause Samples
A Constructive Change Directive is a contractual provision that allows one party, typically the project owner or client, to unilaterally order changes to the scope of work, even if the change is not formally documented as a change order. In practice, this clause enables the contractor to proceed with additional or altered work based on the directive, while preserving their right to later negotiate adjustments to the contract price or schedule. Its core function is to prevent project delays by allowing work to continue while the parties resolve disputes over the scope or compensation for the change, thereby maintaining project momentum and reducing the risk of costly stoppages.
Constructive Change Directive i. A Constructive Change Directive shall be used in the absence of total agreement on the terms of a Change Order.
ii. Adjustments in the Contract Amount for any extra work or changes in the Work shall be determined by one or more of the following methods:
1. By unit prices stated in the Subcontract or subsequently agreed to in writing by both JEG and the Subcontractor.
2. By an estimate and lump sum proposal from the Subcontractor to which JEG and the Subcontractor have agreed in writing.
3. Costs to be determined in a manner agreed upon by the parties and a mutually agreed fixed or percentage fee.
iii. If none of the three methods is agreed upon, the Subcontractor, provided it receives a written order as stated, shall proceed with performance of the extra work and/or change in the Work. In such case, the Subcontractor shall keep and present in such form as JEG may direct, a correct account of the cost actually paid by the Subcontractor to perform the extra work and/or the change in the Work, together with all reasonably necessary documentation to substantiate such costs. Upon request from JEG, the Subcontractor shall make its books and other accounting records available for review.
Constructive Change Directive. A Constructive Change Directive is a written order signed by JEG directing a change in the Work prior to an agreement on price or time adjustment to the Purchase Order, if any.