Bilateral modifications are used to make what type of adjustments?

Bilateral modifications are fundamental in contract management and they refer to changes that require agreement from both parties involved in a contract. Such modifications are particularly used to implement negotiated equitable adjustments, which involve changes to the contract terms, scope, or price as a result of discussions and agreement between the parties.

In the context of construction contracts, for instance, if unforeseen circumstances arise that necessitate alterations to the original contract, both the contractor and the contracting authority would need to concur on the modifications. This ensures that both parties maintain their rights and obligations as per the revised terms.

This type of adjustment allows for flexibility and ensures that changes can be managed collaboratively, fostering a working relationship between the contracting parties. This contrasts with unilateral adjustments, which can be made by one party without the consent of the other and typically do not involve negotiation. Performance-based or cost-reduction adjustments might require specific metrics or outcomes to be met or focus solely on reducing expenses, but they do not inherently necessitate bilateral negotiation or consensus.