Short answer. No. Article 1724 says a contractor who undertook to build for a stipulated price in conformity with agreed plans can neither withdraw from the contract nor demand an increase on account of the higher cost of labor or materials. The only way around it runs through two written documents.

What the law says

can neither withdraw from the contract nor demand an increase in the price on account of the higher cost of labor or materials, save when there has been a change in the plans and specifications, provided: (1) Such change has been authorized by the proprietor in writing; and (2) The additional price to be paid to the contractor has been determined in writing by both parties.

Civil Code, Article 1724 — No Price Increase Without Written Consent. Read the full provision →

A fixed price is a risk the contractor took

Where a contractor undertakes to build a structure or any other work for a stipulated price in conformity with plans and specifications agreed upon with the land-owner, Article 1724 says he can neither withdraw from the contract nor demand an increase in the price on account of the higher cost of labor or materials. That is the point of a lump sum. The contractor priced the job knowing the market could move, and the owner paid for the certainty of a figure that would not move with it. Rising cement or steel prices, and wage increases during the build, are the very contingencies the arrangement allocated to him.

The exception has two written requisites, not one

An increase is possible only where there has been a change in the plans and specifications, and then the article imposes both of the following: (1) Such change has been authorized by the proprietor in writing; and (2) The additional price to be paid to the contractor has been determined in writing by both parties. Contractors regularly satisfy the first and forget the second. A written instruction to add a room, with the cost left to be sorted out later, does not meet the article, because the additional price was never determined in writing by both of you. Both documents have to exist.

What this means for site instructions

Most construction disputes of this kind are made on site rather than in the contract. A homeowner points at a wall during a visit, the foreman moves it, and the claim arrives with the final billing. The safe practice for both sides is the same: reduce every variation to a signed change order that states the change and the agreed additional amount before the work is done. An owner who wants the change should sign it; a contractor who wants to be paid for it should insist on it. Verbal approvals and text messages agreeing in principle are exactly what this article was written about.

Check what your contract actually is

Article 1724 addresses a stipulated price agreed against plans and specifications. A contract priced on a cost-plus basis, or one that carries its own escalation formula tied to a published index, is a different bargain, and the price adjustment there comes from the agreement rather than from this article. So read the pricing clause before either demanding or resisting an increase. Note as well that Article 1720 fixes payment at the time and place of delivery of the work unless there is a stipulation to the contrary, with partial deliveries paid as made where a price for each part was fixed.

Cases citing this provision

These Supreme Court decisions cite the provision above. We list them so you can read them yourself; the summaries of what each decided are not ours to give.

Related provisions

Note. Statute text quoted on this page is reproduced from the official enactment and is linked to the full provision. The explanation around it is general legal information from Vivas & Nobles Law Office, not legal advice. Whether it applies to your situation depends on facts only a lawyer reviewing them can assess.