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Don't Say It If You Don't Mean It: Oral Promises Can Break The Bonds Of Nonmodification Clauses

Friday, July 04, 2008 03:08 pm

Don't Say It If You Don't Mean It: Oral Promises Can Break The Bonds Of Nonmodification Clauses

If you've been tempted during a project to make -- or accept -- on-the-fly, verbal promises that veer from the fine print in the construction contract, you'll want to read on.

Contract language that precludes changes to the agreement not penned in ink doesn't necessarily invalidate a verbal change. Case in point: Under Michigan law, a nonmodification clause can be modified -- or even waived -- by an oral agreement between the involved parties.

Here are three specific examples of cases in which construction contracts underwent enforceable alterations without pen and paper.

1. A side order constitutes an agreement to extra costs

In its ruling in Morley Bros., Inc. v. F.R. Patterson Construction Co., 266 Mich. 52, 253 N.W. 213, 214 (1934), the Michigan Supreme Court noted that "a written contract may be varied by subsequent parol agreement unless forbidden by the statute of frauds even though [the] original contract stipulates that it is not to be changed except by written agreement."

The subcontractor in the case sought payment for extra hardware not contemplated in the original contract that the subcontractor provided for a waterworks building project. The general contractor disputed the claim on the grounds that the parties' contract called for written agreement to any [...]

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