Legal Blog

Change Order/Directives

EllisDon v. Winnipeg Airports 2018 Man (QB)

General and owner disagreed as to the valuation of various change directives for the project. The contract documents (based on CCDC 18 – like CCDC 2 but for civil works) had conflicting provisions as to what could be included in the valuations and what could not. (i) The trial judge relied on the CCDC clause that listed the contract documents in order of priority if there was a conflict between them. (ii) For change directives, the contract stated that the general had to prove its entitlement to payment of the costs before they could be reimbursed and the judge upheld that requirement. However, in the case where some of the subcontractors either settled with the general or went bankrupt, the judge allowed the costs. The judge held that there was no unjust enrichment because the owner suffered no detriment from what it anticipated when it signed the contract and issued the change directives. (iii) The owner also attacked a number of the change orders. The judge noted that the signing of a change order constituted a change to the lump-sum price and that, in this case, the change orders were signed off by the owner and the consultant. Accordingly, the judge held that it was not open for the owner to attempt to claw back amounts that the general had charged pursuant to quotations that it had submitted.

Written by Jonathan Speigel, the founding partner of Speigel Nichols Fox LLP, leads the litigation and construction practices.