Cost Estimate Overruns and Their Consequences
One of the most common grounds of construction disputes is the overrun of the cost estimate. Article 631 regulates this situation clearly: if the contractor significantly exceeds the approximate cost estimate, it may claim only the agreed remuneration, except where the excess could not have been foreseen in advance. This rule places the risk of overspending on the contractor and obliges it to plan precisely.
Where the cost estimate increases in a way that could not have been foreseen at the conclusion of the contract, the contractor must notify the customer immediately. If the customer terminates the contract because of the increase in the estimate, it is obliged to pay for the work performed according to the approximate cost estimate. A timely and documented notice of the overrun is in this situation the foundation of the contractor's position, and its absence may cost the contractor the entire excess.