Michigan Residential Builders License Practice Test

To protect against costly changes in building contracts, what should you include in the contract?

1. A signature from both parties

2. A list of materials

3. Specific page numbers and revision dates for changes

4. A statement of total project cost

The correct answer is: Specific page numbers and revision dates for changes

Including specific page numbers and revision dates for changes in a building contract is essential for clarity and consistency. This element ensures that both parties are on the same page regarding any modifications made to the original agreement. It provides a clear reference point that can mitigate disputes over what exactly has been agreed upon regarding changes to the project. By defining specific pages and revision dates, you maintain an organized record of alterations, which can significantly reduce misunderstandings and misinterpretations later in the process. While signatures, lists of materials, and total project costs are important components of a contract, they do not specifically address the management of changes. Signatures confirm acceptance of the contract, a list of materials provides detail about project specifications, and total project costs clarify financial obligations. However, without a precise system to track revisions and amendments, even well-documented contracts can lead to ambiguities that become costly issues down the line. In contrast, by incorporating specific references to changes, the contract remains clear, and both parties have mutual understanding regarding any adjustments that may occur.