Utah General Contractors - Business and Law Practice Exam

Contractors use _______________ to modify the terms of an existing contract when changes are made.

1. Adjustments

2. Change Orders

3. Amendments

4. Specifications

The correct answer is: Change Orders

Using change orders is a standard practice in the contracting industry when modifications to an existing contract are necessary. A change order is a formal document that outlines adjustments to the scope of work, cost, or schedule of a project after the original contract has been signed. It is crucial for documenting any agreements made after the initial contract to ensure that all parties understand the changes and can manage the implications effectively. Change orders are typically used to address unforeseen circumstances, design changes requested by the client, or scope adjustments that arise during the project. They serve as a record of authorization for the change and promote transparency among all parties involved, which helps to mitigate disputes. In contrast, the other terms do not accurately describe the process of modifying existing contract terms. Adjustments might refer to informal changes but lack the formal documentation that change orders provide. Amendments can also modify contract terms, but they generally refer to broader changes and require additional legal processes. Specifications typically do not change the terms of the contract but rather detail the specific requirements and standards for project execution.