It’s a relatively cool morning in the fall, with a high of about 72 degrees — a great day to be working. Your crew backs in the trailer, gets the compressors up to pressure, and ties down the ladders. Just as soon as you’re about to start work, the owner comes around and says, “I hope you don’t plan to use those nail guns for the work.”
You mention that your team is experienced with the latest equipment and that the regulators are calibrated. You also mention your price is competitive because your team will wrap up the work quicker with nail guns. But the owner holds their ground and says, “I don’t want any gun-driven nails on my project.”
Now you’re thinking about the extra costs and what’s next. You’re not being asked to do something completely different — still shingling the same roof or framing the same house. But you’re being asked to do it in a specific way. This is an example of a constructive change. There are a few other types of common constructive changes, and with a better understanding of those types, you’ll be able to nail down your next steps.
A constructive change, more or less, occurs when a contractor’s means or method of work is impacted by the other party’s direction or as a result of a change in law or regulations. By definition, it is an unacknowledged change. If asked, the owner would say that the contract supports their direction. So, neither a written directive nor a change order is needed.
But constructive changes can occur in other common fact patterns, including specification ambiguity or hypertechnical inspection standards. There remain still a few other recognized instances of constructive changes, but they are uncommon and are arguably extensions of these more general issues.
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For example, a request to accelerate contract performance could be a constructive change because acceleration does not impact what must be done by contract, but instead how it must be done. And this falls squarely in our very first category of a constructive change — a change not in the scope of the work, but in the means or methods for accomplishing the work. These means or method driven changes most typically come from an owner or someone up the contract line.
Sensibly, these claims derive from the contractor’s responsibility and right to control its work — meaning the contractor’s right to control the means, methods, techniques, sequences, and procedures implemented in prosecuting the work unless stipulated otherwise. In other words, parties up the contract line cannot direct those means or methods unless the parties agree to something different in the contract.
Constructive changes may also result from specification ambiguity. These occur when a contractor is compelled to alter their work due to unclear contract specification language — eventually leading to differing interpretations.
For instance, in the case of Metric Constructors, Inc. v. U.S., a contract for installing plumbing and HVAC systems included an insulation specification that was ambiguously worded. While the contractor interpreted the specifications to allow for flexible ductwork without insulation, the government insisted on the use of insulation not compatible with the specified ducts. The court determined that the ambiguity was a "gray area," indicating it was latent and should therefore be construed against the government.
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Another classic example of specification ambiguity is found in Ets-Hokin Corp. v. U.S., involving the installation of a fire detection system at NASA Mission Control Center. The contractor interpreted the requirement for an automatic fire detection system as one similar to those previously installed, but the government later construed the specifications to require a more expensive ionization system — not explicitly mentioned. The contractor, having installed the ionization system under protest, sought to recover the extra costs, and the court ruled in favor of the contractor, affirming that the specifications were reasonably susceptible to ambiguity.
In each of the above, an increased cost of operation resulted from gray contract specification language — an ambiguous spec-driven change.
Finally, some project changes may result from overzealous inspections. Generally, these types of changes result from projects where inspection tests involve testing methods not specified in the contract.
For example, an owner or general contractor may require specific types of vibration or sound level testing or non-standard materials testing methods not specified in the contract. These more stringent standards for work evaluation may result in increased costs because of something that the contractor could not have reasonably foreseen. This is the typical constructive change due to hypertechnical inspections.
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Lawyers have adopted the term “constructive changes” for purposes of classifying these types of changes and discussing their properties and burdens of proof. Those considerations aren’t important here. What is critical is that your team understands the concept as part of the landscape of construction projects.
Whether stemming from owner directives, specification ambiguities, or overzealous inspections, these changes can significantly impact both the workflow and financial aspects of a project. Recognizing the signs of constructive changes early on allows contractors to address disputes proactively — by ensuring that contractors provide notice to the owner of possible extra costs, engage in dialog about the importance of the change, and ultimately maintain the right to secure fair compensation for time and/or monetary impacts caused by these unforeseen challenges.
And now that you’re calibrated to the core principles, you can nail down these squirrelly changes should one ever arise.
