52.243-4 Changes
Source: FAR 52.243-4 on acquisition.gov
FAR 52.243-4 requires contractors to promptly document and notify the Contracting Officer of any changes to ensure entitlement to equitable adjustments in cost or schedule.
Overview
FAR 52.243-4, "Changes," is a standard clause for fixed-price construction contracts that outlines the procedures and rights related to changes in the contract work. It allows the Contracting Officer to unilaterally issue written change orders within the general scope of the contract, covering specifications, methods, government-furnished property, or acceleration of work. The clause also addresses how oral or informal orders that result in changes are to be handled, requiring contractors to provide timely written notice if they consider such orders to be change orders. It establishes the process for equitable adjustments to contract price or schedule due to changes, sets deadlines for asserting claims, and limits adjustments for costs incurred before proper notice is given. The clause is designed to ensure both parties understand their rights and obligations when contract changes occur.
Key Rules
- Authority to Issue Change Orders
- The Contracting Officer can issue written change orders at any time, affecting specifications, performance methods, government-furnished property, or work acceleration.
- Recognition of Oral or Informal Orders
- Oral or informal orders from the Contracting Officer that cause changes must be acknowledged by the contractor with written notice to be treated as change orders.
- Equitable Adjustments
- Contractors are entitled to an equitable adjustment in contract price or schedule if a change increases or decreases cost or time, but must provide timely notice and proposals.
- Notice and Proposal Deadlines
- Contractors must assert their right to an adjustment within 30 days of receiving a change order or giving notice of an informal change, unless extended by the Government.
- Limitation on Claims
- No proposals for equitable adjustment are allowed after final payment, and costs incurred more than 20 days before notice are generally not recoverable (except for defective specifications).
Responsibilities
- Contracting Officers: Issue change orders in writing, consider contractor notices of informal changes, and process equitable adjustments and contract modifications.
- Contractors: Provide timely written notice of informal changes, submit adjustment proposals within deadlines, and maintain records of changes and associated costs.
- Agencies: Ensure procedures for change order processing and equitable adjustment are followed, and maintain oversight of contract modifications.
Practical Implications
- This clause provides a formal mechanism for managing changes in construction contracts, protecting both government and contractor interests.
- Contractors must be vigilant in documenting and promptly reporting any changes or instructions that may affect contract scope, cost, or schedule.
- Failure to provide timely notice or assert claims within the specified periods can result in loss of entitlement to adjustments, making compliance critical.
As prescribed in 43.205(d), insert the following clause: The 30-day period may be varied according to agency procedures.
Changes (June 2007)
(a) The Contracting Officer may, at any time, without notice to the sureties, if any, by written order designated or indicated to be a change order, make changes in the work within the general scope of the contract, including changes-
(1) In the specifications (including drawings and designs);
(2) In the method or manner of performance of the work;
(3) In the Government-furnished property or services; or
(4) Directing acceleration in the performance of the work.
(b) Any other written or oral order (which, as used in this paragraph (b), includes direction, instruction, interpretation, or determination) from the Contracting Officer that causes a change shall be treated as a change order under this clause; Provided, that the Contractor gives the Contracting Officer written notice stating-
(1) The date, circumstances, and source of the order; and
(2) That the Contractor regards the order as a change order.
(c) Except as provided in this clause, no order, statement, or conduct of the Contracting Officer shall be treated as a change under this clause or entitle the Contractor to an equitable adjustment.
(d) If any change under this clause causes an increase or decrease in the Contractor’s cost of, or the time required for, the performance of any part of the work under this contract, whether or not changed by any such order, the Contracting Officer shall make an equitable adjustment and modify the contract in writing. However, except for an adjustment based on defective specifications, no adjustment for any change under paragraph (b) of this clause shall be made for any costs incurred more than 20 days before the Contractor gives written notice as required. In the case of defective specifications for which the Government is responsible, the equitable adjustment shall include any increased cost reasonably incurred by the Contractor in attempting to comply with the defective specifications.
(e) The Contractor must assert its right to an adjustment under this clause within 30 days after (1) receipt of a written change order under paragraph (a) of this clause or (2) the furnishing of a written notice under paragraph (b) of this clause, by submitting to the Contracting Officer a written statement describing the general nature and amount of the proposal, unless this period is extended by the Government. The statement of proposal for adjustment may be included in the notice under paragraph (b) of this clause.
(f) No proposal by the Contractor for an equitable adjustment shall be allowed if asserted after final payment under this contract.
(End of clause)