Valuation of Change Order Directive Clause Samples
The Valuation of Change Order Directive clause defines the process for determining the cost or price adjustment resulting from a change order directive issued during a project. Typically, this clause outlines the methods for calculating the value of additional work, deletions, or modifications, such as using agreed unit prices, time and materials, or negotiated lump sums. Its core function is to ensure that both parties have a clear, fair, and consistent method for pricing changes, thereby minimizing disputes and maintaining project progress when modifications are required.
Valuation of Change Order Directive. If the Province has issued a Change Order Directive and the Province and the Contractor have not been able to reach agreement on the Estimate and, if applicable, an adjustment to the Contractor’s Construction Schedule or the M&R Payments in Schedule 14 (Payment Schedule), then adjustments to the Contractor’s Construction Schedule or the M&R Payments in Schedule 14 shall be determined by the Dispute Resolution Procedure, applying the criteria set out in Section 3.3(b)(iv) and having regard to the manner in which value and payment are determined in subclauses (a) and (b) below, and the work attributable to the Change Order shall be valued and payment to the Contractor shall be determined as follows:
(a) for the work associated with the Change Order Directive that is to be performed by the Contractor’s own forces or by the subcontractors identified in Schedule 17 (Subcontractors) (the “Schedule 17 Subcontractors”), that portion of the work associated with the Change Order (the “Own Forces Work”) shall be valued as the Total Cost of Materials and Labour for the Own Forces Work, plus:
(i) for Overhead Costs, an additional 10% of the Total Cost of Materials and Labour for the Own Forces Work; and
(ii) for profit, an additional 10% of the sum of the Total Cost of Materials and Labour for the Own Forces Work and the amount determined in accordance with Section 4.4(a)(i).
(b) for the work associated with the Change Order Directive that is to be performed by a subcontractor of the Contractor (other than the Schedule 17 Subcontractors) pursuant to a contract between the Contractor and such subcontractor, that portion of the work associated with the Change Order (the “Subcontractor Work”) shall be valued as the Total Cost of Materials and Labour for the Subcontractor Work, plus:
(i) for Overhead Costs of the subcontractors performing the Subcontractor Work, an additional 10% of the Total Cost of Materials and Labour for the Subcontractor Work;
(ii) for profit for the subcontractors performing the Subcontractor Work, an additional 10% of the sum of the Total Cost of Materials and Labour for the Subcontractor Work and the amount determined in accordance with Section 4.4(b)(i); and
(iii) for the Contractor’s work (including without limitation Overhead Costs and profit) on the Subcontractor Work, an amount equal to 5% of the sum of the Total Cost of Materials and Labour for the Subcontractor Work and the amounts determined in accordance with Section 4.4(b)(i) and (ii).
(c...
Valuation of Change Order Directive. If the City has issued a Change Order Directive and the City and Project Co have not been able to reach agreement on the Estimate and, if applicable, an adjustment to Project Co’s Construction Schedule or any payments due to Project Co hereunder, then adjustments to Project Co’s Construction Schedule or any payments due to Project Co hereunder shall be determined by the Dispute Resolution Procedure, applying the criteria set out in Section 3.4.