Payne Hackenbracht & Sullivan

Cardinal Change

A cardinal change has been defined as one which cannot be redressed within the contract by an equitable adjustment to the contract price. Allied Materials & EquiDment Co.. Inc. v. United States, 569 F.2d 562, 215 Ct.Cl. 406 (1978). The purpose of the "cardinal change" doctrine is to provide a remedy for contractors who are directed by the government to perform work which is not within the general scope of the contract. Edward R. Marden Corp. v. United States, 194 Ct.Cl. 799, 808, 442 F.2d 364, 369 (1971). A cardinal change is not encompassed by the Changes clause because it is one which fundamentally alters the contractual undertaking of the contractor. Marden, 194 Ct.Cl. at 808; Air-A-Plane Corp. v. United States, 187 Ct.Cl. 269, 275-76, 408 F.2d 1030, 1033 (1969). The basic standard, therefore, is whether the directed change comprises "essentially the same work as the parties bargained for when the contract was awarded." Araaona Construction Co. v. United States, 165 Ct.Cl. 382, 391 (1964).

In determining whether a change is within the general scope of the contract, consideration must be given to both the character and magnitude of the change, as well as to its cumulative effect upon the project as a whole. Wunderlich Contracting Co. v. United States, 173 Ct.Cl. 180, 194, 351 F.2d 956, 966 (1965); Keco Industries v. United States, 176 Ct.Cl. 983, 998-99, 364 F.2d 838, 847-48 (1966), cert. denied, 386 U.S. 958 (1967). Thus, while a cardinal change will exist where the ordered deviations "alter the nature of the thing to be constructed," Aragona, 165 Ct.Cl. at 391, it is the entire undertaking of the contractor which is critical to the analysis. Marden, 194 Ct.Cl. at 808.

It is well-established, for example, that a change incorporating extensive redesign resulting from a defective specification is beyond the scope of the contract and therefore constitutes a cardinal change. In Luria Bros. & Co. v. United States, 177 Ct.Cl. 676, 369 F.2d 701 (1966), the Court determined that the original specifications were defective because they misrepresented the nature of the bearing value of the material underlying the foundation of the structure, thereby affecting the required dimensions and depth of the structure's footings. As a result of revised specifications, the footings were placed 5 to 10 feet lower than the original elevations, with the size of each footing dependent upon its elevation. Given the required redesign, the Court made the following ruling:

Under these circumstances we are of the opinion that the changes made as the result of encountering the unsatisfactory material at the subgrade elevations were of such magnitude that they were not within the scope of the original contract but rather constituted a breach thereof.

Luria, 177 Ct.Cl. at 687, 369 F.2d at 707. Thus, the Court of Claims has determined that where the specifications for a building foundation are found to be inadequate due to the subsurface conditions encountered, substantial redesign of the foundation constitutes a cardinal change. See, e.a., Saddler v. United States, 152 Ct.Cl. 557, 287 F.2d 411 (1961); Stapleton Construction Co., Inc. v. United States, 92 Ct.Cl. 551 (1941); Sobel v. United States, 88 Ct.Cl. 149 (1938); Rust Engineerinq Co. v. United States, 86 Ct.Cl. 461 (1938).