Variation Orders had an impact on overall project performance and the major adverse impact relates to time and cost overruns and disputes between the parties to the contract.
Variation orders are a part and parcel of construction contracts. All standard forms of contracts have a mechanism to follow for variation orders. Construction projects are prone to changes as requirements may arise during the construction phase or due to some constraints some works have to be omitted, a construction project is rarely completed as per its original design. This requirement is recognized and as a result a power to vary is included in the Contract as a right of the Employer.
The Contractor needs to follow the mechanism mentioned in the Contract to avoid disputes, and can claim for any eot resulting from such a variation order.
It has to however be noted that variation orders cannot be limitless, although contract forms like FIDIC do have clauses which are very wide in their meaning.
However variation can be tricky in case of lump sum contracts where the Contractor needs to be careful while preparing his tender. Works which need to be completed to achieve completion and performance may not be regarded as variations, despite the fact that they have not been incorporated in the documents.
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