How do you Modify a Service Contract Already Executed? By Jeff Willison.
What is a contract? People always talk about contracts as things people sign, but that’s not always the case. Whether it is on paper or during a conversation about buying a car, couch, or leasing an apartment, so long as there is a valid offer, acceptance, and consideration, a valid contract may be formed. However, when you agree to do something (i.e. a service contract), once both parties agree that a contract exists, how do you change the terms? For example, say you agree to mow someone’s yard for the summer. You both put it in writing that you will mow the grass twice a week for $50 each time from June 1st till September 1st. However, the person you made the agreement is willing to offer you $75 each time to mow it three times a week after he finds out that twice a week is not enough.
Do you chuck the original contract and write another one? The answer is you may modify the original contract. Georgia law defines a modification as “[a] change or alteration, which introduces new elements into the details, or cancels some of them, but leaves the general purpose and effect of the subject-matter of a contract intact.” Evans v. Henson, 73 Ga. App. 494, 494, 37 S.E.2d 164 (Ga. Ct. App. 1946). Does this sound familiar? Let’s break down our fact pattern: you both agreed to mow the lawn for $50, twice a week and the client wants to increase the amount to $75 if you mow the grass three times a week. The change of fee and frequency is a change or alteration which introduces new elements (i.e. more money and more work), but the general purpose of the agreement is to mow the client’s lawn. This is a modification to a service contract.
You may be asking yourself: “So, what if the client makes an agreement to do this, I rely on it by mowing the grass three times a week, but he only pays me $50?” Georgia law recognizes that a written contract may be modified by mutual consent of the parties, which “need not be expressed in words, in writing or signed, but the parties must manifest their intent to modify the original contract.” Ryder Truck Lines, Inc. v. Scott, 129 Ga. App. 871, 873-74, 201 S.E.2d 672 (Ga. Ct. App. 1973).
How do you manifest an intent? The simple explanation for this phrase is: a contract modification may be shown through action. While writing is always the preferred method, it’s not the only way. If you mow the lawn three times a week, instead of two like the original contract stated, you have shown your intent to change the agreement or agreeing to the contract’s new terms. In addition, if the client does not inform you that the modification is invalid or does not challenge you in some way, he/she has agreed or waived their ability to challenge the modification based on assent and is bound to the terms of the modification. The ultimate decision maker of whether the contract has been modified in a court of law is the fact finder (i.e. a jury or a judge in a nonjury trial).
So, how do you get the money if he doesn’t pay? Well, the short answer is the filing of a breach of contract action. Keep in mind that just because a contract is valid and enforceable doesn’t mean that the opposing party will just pay or go along with the terms as agreed or modified. A breach of contract action can be complex and it always makes sense to consult with an attorney to help guide you through the procedure and the associated costs.
If you have any questions, contact Jeff Willison.
As always, see our Disclaimer.