Change Order Procedure Waived Despite “No Waiver” Language
A default termination was justified when a tardy contractor responded to a government cure notice with a request for an extension of the contract completion deadline. This was a repudiation of the contractor’s contractual obligations. There had been no excusable delay.
(Construction Claims Advisor: Vol. 24, Iss. 11, June 15, 2026)
(Note to Paul - the following was pasted in as HTML.)
Supreme Court of New Hampshire
RJH Builders, LLC v. Thistle
Case no.: 2024-0530
Date filed: June 2, 2026
Overview
The New Hampshire Supreme Court has ruled that a mutual pattern of conduct waived the change order clause of a construction contract. The clause was not saved by the agreement's "no waiver" language.
Background
Robert and Priscilla Thistle (the Thistles) entered into a contract with RJH Builders LLC for construction of a custom home. The fixed-price agreement included a change order clause stating that any changes to the scope of work or specifications had to be agreed upon in writing, signed by both parties and that any additional cost had to be paid prior to commencement of the changed work.
The contract included two other provisions relevant to the subsequent dispute:
- "No term or provision of this Agreement shall be amended or waived except … in a document in writing signed by the Parties."
- "The failure of either party to insist upon strict compliance with any term or condition of this Agreement shall not constitute a waiver of such term or condition."
The Thistles revised the house plans after contract signing but before work commenced. The parties did not execute any change orders. As work progressed, the Thistles asked RJH how much it would cost to finish the space over the garage. RJH gave an oral estimate and constructed dormered windows and interior finish. RJH presented the Thistles with invoice number 398 for the extra work, which the Thistles paid.
As work continued, the Thistles continued to request additions and upgrades. At no time did the parties sign a written agreement or advance payment for the additional work.
The Thistles later disputed invoice number 404 for changed and extra work; specifically, they questioned the pricing of some items and contended other items had been included in the original scope of work. The Thistles refused to pay the invoice. This payment dispute led to a breakdown in the relationship between the homeowners and RJH Builders. The contractor abandoned the project and sued for breach of contract and unjust enrichment. The owners counterclaimed for breach of contract.
RJH argued the owners could not rely on the absence of written change orders to justify refusal to pay for extra work. The contractor contended the parties, through their conduct, had waived the change order provision of the contract. A trial judge agreed and awarded RJH payment for invoice 404 plus other unpaid work. The Thistles appealed.
The Ruling
The Supreme Court of New Hampshire, in an order signed by three judges, ruled that the parties, through their mutual conduct, had waived the change order clause.
"[T]he record reflects that the parties chose to forgo the change order process repeatedly throughout the construction. On the multiple occasions that the Thistles asked RJH to make changes that were outside the scope of the Construction Agreement, they never requested written descriptions of the changes or the disclosure of the associated costs, or inquired whether any delays would result. Similarly, RJH never requested that the Thistles pay for the extra work before it began. Each request for additional work presented an opportunity for either party to invoke the change order provision, but neither did so."
The court said its ruling was not altered by the "no waiver" language in the construction contract. While "strict compliance" with the change order clause was not required, this pattern of conduct amounted to total abandonment of the clause by both parties.
"[W]hile paragraph 24(b) provides that the 'failure of either party to insist upon strict compliance' with a contract term does not constitute a waiver, the record reveals that the parties did not comply with any part of the change order provision. Their mutual conduct therefore went beyond the failure to strictly comply with its terms" (emphasis by the Court).
Conclusion
The mutual conduct of the parties in the early stages of the project made a payment dispute almost inevitable.
Practical Takeaway
Something as close as possible to strict compliance with the contractual change order process is in the best interest of project owner and contractor alike.
Participants:
No attorneys of record listed.
Before: Judges Donovan, Countway and Gould
Opinion by: The full panel.
Outcome: Judgment in favor of contractor affirmed.