The three basic cases
| Case | Basis | Order required | Notice |
|---|---|---|---|
| Quantity variation above 10 per cent | § 2 para. 3 | no | as a rule not |
| Changed work | § 2 para. 5 | yes, under § 1 para. 3 | price should be agreed in advance |
| Additional work | § 2 para. 6 | yes, under § 1 para. 4 | yes, before execution begins |
The third and fourth columns contain the distinction most often confused in practice. Only the third case presupposes notice.
Quantity variation needs no order
Under a remeasurement contract the quantities tendered are estimates, not commitments. Where the quantity actually executed departs from them, it follows first only that the account is drawn on the actual quantity.
A claim to adjust the price arises only above a threshold. Where the departure exceeds 10 per cent, either party may require the unit rate to be adjusted.
The provision operates both ways:
| Direction | Threshold | Who may require what |
|---|---|---|
| Excess quantity | above 110 % | the client a reduction, the contractor an increase in the unit rate for the excess |
| Reduced quantity | below 90 % | the contractor the shortfall in site set-up costs, overheads and general administration |
Whether risk and profit also enter the reduction case is contested but generally affirmed. Notice is as a rule not required in either case, because the additional payment follows from the contract model chosen rather than from any conduct of the client.
A distinction must be drawn between quantity departures arising from inaccuracies in measurement and those arising from subsequent orders by the client. The latter fall under the provisions on changed and additional work.
Changed work
Where the client alters the design or makes other orders changing the basis of the price for work provided for in the contract, a new price is to be agreed taking account of the increased or reduced costs. What is presupposed is an order and not merely a changed circumstance.
The agreement should be reached before execution. The wording states a duty of endeavour, not a condition of the claim. Neglecting it therefore does not extinguish the claim but makes enforcing it considerably harder.
In practice the price is frequently left open deliberately, because construction must proceed. Wording such as an instruction in principle is common. It shifts pricing into a phase in which the contractor has already performed and their negotiating position is correspondingly weaker.
Additional work
Where work not provided for in the contract is required, the contractor is entitled to separate payment. Unlike changed work, a genuine duty to give notice applies here: the claim must be notified to the client before execution begins.
Notice is the contractor's most effective protection and simultaneously the most frequently neglected formality. It costs little and governs enforceability.
For public clients a variation agreement on the additional payment must moreover be concluded. A bare acknowledgement in principle does not suffice there.
The case law has changed
This is the most important point of this article and the least well documented in older sources. Three positions have to be kept apart.
| Position | Content |
|---|---|
| The former rule | pricing rested on carrying forward the original calculation; the new price was derived from the tender figures, on the maxim that a good price stays a good price |
| The reversal | the Federal Court of Justice abandoned that rule in 2019 for quantities above 110 per cent; what governs since are the actually necessary costs plus appropriate mark-ups |
| The open area | whether the same holds for changed and additional work is not settled at the highest level; the prevailing view affirms it, and the lower courts have followed |
An uncomfortable position follows for practice: the governing method of calculation for the commonest kind of variation is unsettled at the highest level. The article on pricing a variation covers the calculation in detail.
Where no agreement is reached
Where no agreement is reached before, during or after execution, the general law of works contracts applies. Customary remuneration then counts as agreed.
Its basis must then be established under the provisions of the VOB/B, which does not simplify the task. In practice it means the dispute is litigated and both sides require expert evidence.
A recommendation follows that holds for both parties: a variation agreement before execution is almost always cheaper than the dispute afterwards, whatever price is agreed. It spares both sides proving the actually necessary costs.
The link to the specification
Variations are rarely accidental, and their causes are strikingly uniform. The commonest is a specification that was not clear and exhaustive.
| Cause | Consequence |
|---|---|
| missing item | additional work under § 2 para. 6 |
| inaccurate quantity | quantity variation under § 2 para. 3 |
| unclear description | dispute over scope |
| incomplete particulars on the existing fabric | order and changed work |
| impermissible risk transfer | variation or ineffective clause |
The link is economically the most important in this subject: the effort of a complete specification is less than the price of the variations it prevents. The system is covered in the article on clear and exhaustive specification.
What to record
Four entries govern enforceability in a dispute. They must be recorded as work proceeds, not at the final account.
| # | To be documented | Why |
|---|---|---|
| 1 | The order | with date, content and author; an oral order is effective but hard to prove |
| 2 | The notice | for additional work, before execution begins |
| 3 | The cost calculation | with a traceable derivation of the increased or reduced costs |
| 4 | The effect on periods | since a change regularly touches the programme |
The fourth is most often overlooked and the most expensive, because an unclaimed extension of time can lead to delay. The consequences of delay regularly exceed the amount of the variation.
Related articles
This article reflects the position of the rules and case law at the date of checking and serves professional orientation. It does not constitute legal advice and does not replace assessment of the individual case.