Oregon Construction Contractors (CCB) Practice Test

What does a change order do in a construction contract?

1. Increases the project budget

2. Modifies an existing agreement

3. Ends the contract

4. Creates a dispute

The correct answer is: Modifies an existing agreement

A change order modifies an existing agreement in a construction contract. This process is essential because construction projects often encounter unforeseen circumstances or changes in scope that require adjustments to the original contract. By formally documenting these changes through a change order, all parties involved acknowledge the new terms agreed upon, which may include alterations to the scope of work, adjustments to timelines, or changes in materials. This helps prevent misunderstandings and provides a clear record of what was agreed upon, ensuring that both the contractor and the client are aligned regarding the project’s expectations and requirements. In contrast, while a change order might influence the project budget, potentially increase costs, or lead to disputes, its primary role is to serve as an official modification to the existing contractual agreement. This formal change process safeguards both parties and maintains the integrity of the contractual relationship throughout the project.