Which term is used to describe compensation adjustments required due to scope changes after design commitments?

Which term is used to describe compensation adjustments required due to scope changes after design commitments?

• A. Change Order
• B. Request for Equitable Adjustment
• C. Cost Reimbursement
• D. Penalty Clause

Answer: (B)

When scope changes occur after design commitments, the contract relies on an equitable process to adjust compensation to reflect the new reality. The request for equitable adjustment is the formal mechanism used to seek fair compensation for the additional costs and potential schedule impacts caused by that change. It ensures the owner and the design-build team negotiate a fair balance rather than simply applying a fixed price. A change order is the usual document that authorizes a modification to the contract, but the specific concept described—compensation adjustments due to a scope change after design commitments—fits the equitable adjustment process. Cost reimbursement is about how payments are made, not the mechanism for adjusting them due to changes, and a penalty clause concerns penalties for delays or violations, not the adjustment of costs.

When scope changes occur after design commitments, the contract relies on an equitable process to adjust compensation to reflect the new reality. The request for equitable adjustment is the formal mechanism used to seek fair compensation for the additional costs and potential schedule impacts caused by that change. It ensures the owner and the design-build team negotiate a fair balance rather than simply applying a fixed price. A change order is the usual document that authorizes a modification to the contract, but the specific concept described—compensation adjustments due to a scope change after design commitments—fits the equitable adjustment process. Cost reimbursement is about how payments are made, not the mechanism for adjusting them due to changes, and a penalty clause concerns penalties for delays or violations, not the adjustment of costs.