During a project, you discover that the building inspector is requiring additional work not shown in the original plans. The architect claims this is a field condition and not their responsibility. How should you handle this situation?
Correct Answer
C) Document the issue and submit a change order request
Proper documentation and change order procedures protect all parties. The contractor should document the inspector's requirements and follow the contract's change order process to address scope changes.
Why This Is the Correct Answer
Option B is correct because proper documentation and change order procedures are essential for protecting all parties in construction contracts. When an inspector requires additional work not shown in the original plans, this constitutes a change in scope that must be handled through formal contract procedures. Documentation creates a paper trail that establishes the reason for the change, protects the contractor from liability, and ensures proper compensation for additional work. Following the contract's change order process maintains professional relationships and legal compliance.
Why the Other Options Are Wrong
Option B: Proceed with the work and absorb the cost
Option D is wrong because billing the architect directly bypasses the proper contractual relationships and change order procedures. The contractor's contract is typically with the owner, not the architect, and the architect's responsibility for the additional work would need to be determined through proper documentation and contract review.
Option D: Complete the work and bill the architect directly
Option A is wrong because absorbing the cost of additional work not in the original scope sets a dangerous precedent and can lead to significant financial losses. Contractors have a responsibility to their business and other stakeholders to seek proper compensation for work beyond the original contract scope.
Memory Technique
Think 'CYA' - Cover Your Assets. Always document and use proper procedures to protect yourself legally and financially when scope changes occur.
Reference Hint
Florida Building Code Administration chapter and AIA contract documents section on change orders and field conditions
More Business & Finance Questions
A general contractor purchases equipment worth $45,000 with a useful life of 9 years and no salvage value. Using straight-line depreciation, what is the annual depreciation expense?
What is the typical recommended coverage amount for general liability insurance for a small to medium-sized general contracting business?
A contractor estimates startup costs of $75,000 for equipment, $25,000 for initial inventory, $15,000 for insurance premiums, and $10,000 for working capital. They can finance 70% of the total. How much cash do they need?
When establishing professional relationships with architects and engineers, what is the most important factor for a general contractor to consider?
A partnership agreement for a construction company should address all of the following EXCEPT:
A contractor purchases a truck for $60,000. After 5 years, it has accumulated depreciation of $35,000. What is the truck's book value?
A contractor's business plan projects first-year revenue of $500,000 with a 15% net profit margin. If actual revenue is $450,000 with the same profit margin, what is the variance in net profit?
Using the Modified Accelerated Cost Recovery System (MACRS), construction equipment is typically depreciated over how many years?
A contractor is comparing financing options for equipment purchase. Option A: $80,000 cash purchase. Option B: $20,000 down, $65,000 financed at 6% for 4 years. What is the total cost of Option B?
A contractor purchases equipment using a capital lease with a present value of $120,000. How should this be recorded on the balance sheet?