Additional work or contract work?

There can be many reasons for additional work: the client wants changes to the project, the contractor has discovered that the groundwater is unexpectedly high, the consultant has not specified whether the facade panels should be riveted or screwed, and so on. What additional work has in common is that it concerns matters that were not taken into account when the contract was entered into.

The contractor often justifies a claim for additional payment by arguing that the tender documents were unclear or that the work was more extensive than agreed.

If the parties agree that the work is additional work, they will normally draw up a change order for the work in question. This applies in particular where it is clear that the work is not part of the contractual basis, for example if the client wants one more wall than originally envisaged. Where it is less clear whether a piece of work is additional work or not, the parties must take the tender documents as their starting point, and the key question is what the contractor could reasonably assume when the contract was entered into.

Ambiguities between drawings and specifications often lead to disagreement between the client and the contractor. On the one hand, the contractor will argue that the tender documents are not clearly and unambiguously worded, while the client will probably take the view that, unless otherwise agreed, the contractor must deliver customary good quality, carried out in a workmanlike manner and with the necessary ancillary work in accordance with AB 18 § 12(1).

The project documents may have stated that the contractor was obliged to install painted fire doors complying with the authorities’ fire requirements. It may have been less clear from the drawing that the doors were to be painted a pastel green. It is in situations like this that it becomes relevant to consider where in the project documents the work in question ought to appear. Practice shows that such ambiguities often lead to disagreement between contractor and client.

The fact that a piece of work does not appear in full in the project specifications makes it relevant to consider whether the contractor ought to have foreseen the work on the basis of the drawings.

Case law from the Danish Building and Construction Arbitration Board does not necessarily paint a uniform picture. In T:BB 2008.305 VBA, for example, the Arbitration Board did not regard a piece of work as additional work, on the grounds that the precise work appeared on a drawing. In that specific case it was therefore sufficient that the work simply appeared on a drawing, and it was accordingly regarded as contract work.

The situation was the reverse in KFE 1976.51, where bedpan washers were the subject of the dispute between the parties. In that case, the bedpan washers appeared on certain drawings but not in the sanitary fittings schedules. The Arbitration Board concluded that the contractor was entitled to assume that the sanitary fittings schedule was exhaustive. It was therefore additional work for which the contractor could claim additional payment, and the client should have mentioned the installation of the bedpan washers in a more obvious place, e.g. in the work specification.

It is far from certain that specifications will be given more weight than drawings. This depends to a large extent on the specific circumstances. This is also illustrated in T:BB 2015.62, where the contractor considered itself entitled to additional payment for installing a number of fire dampers. The Arbitration Board found, however, that the contractor was not entitled to additional payment, as the number of fire dampers required appeared on the drawings. Installing the fire dampers was therefore regarded as contract work, even though the precise number appeared only on the drawings.

Case law thus points in different directions, and no general requirement can be derived that all matters must be described directly in the tender documents in order to form part of the contract. On the other hand, the outcome of a dispute depends more on the specific circumstances. Routine working methods or industry standards may lower the requirements for the level of detail in the documents, as it is generally assumed that the contractor is familiar with such matters. Weight will also be given to the extent to which the contractor had in-depth knowledge of the project, e.g. because the contractor was involved early in the project to provide input on the execution.

At the same time, complex or innovative projects will raise the requirements for precision and clarity in the project documents, as such projects may involve greater uncertainties that require a specific description.

Professional insight into the field and the project in question is therefore crucial when assessing whether the circumstances could have been foreseen by the contractor or go beyond what was agreed.

When preparing the tender documents, the client should seek to minimize the risk of disputes about additional work. This can be achieved, among other things, by specifying your wishes for the project as precisely as possible before the project documents are finalized.  It can also be useful to rely on early contractor involvement to minimize the risk of open questions arising late in the process.

For the client, it can be tempting to use a ‘legal magic formula’. There are many examples of such formulas, but one frequently encountered is that ‘the contractor’s bid must include all work and ancillary work’. Arbitration practice has generally shown considerable skepticism towards such elastic terms, which are inserted solely to relax the requirements for the client’s tender documents. As it is difficult, in light of case law, to predict whether a drawing or the specification will be decisive, the client should make sure that the tender documents are thoroughly prepared.

The contractor, for its part, should generally be clear about when work is additional work and at the same time give specific reasons why the work constitutes additional work .