On October 10, 2025, Governor Newsom signed SB 440, titled the Private Works Change Order Fair Payment Act. The new law introduces a process and deadlines for handling change order, time extension and payment disputes on private-works construction projects. SB 440 will apply to contracts entered into on or after January 1, 2026, and will remain in effect until January 1, 2030.

What Is Changing?
Construction projects often undergo changes during the construction process that may result in additional costs for labor and materials. Currently, there are no specific processes mandated for resolving change orders on private works of improvement in California. On January 1, 2017, California implemented Public Contract Code section 9204 to provide a claims resolution process for contractors engaged in public works projects, and SB 440 seeks to implement a similar process for private, nonresidential construction projects.

Reprinted courtesy of Samuel Bucher, Pillsbury, Marc Coats, Pillsbury and William S. Hale, P.E., Pillsbury

Mr. Bucher may be contacted at samuel.bucher@pillsburylaw.com
Mr. Coats may be contacted at marc.coats@pillsburylaw.com
Mr. Hale may be contacted at william.hale@pillsburylaw.com