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Limitations On The Enforcement Of Notice Requirements

Monday, December 02, 2002 11:42 am

Limitations On The Enforcement Of Notice Requirements

Construction contracts typically contain notice requirements. In order for a party to obtain certain remedies or enforce certain rights under the contract, formal written notice must be provided to the other party.

Parties to a contract should always assume that notice requirements will be enforced against them. Competent project administration includes familiarity with and adherence to the notice requirements of the contract. And this information must be possessed by personnel in the field who are in a position to detect occurrences that might trigger an obligation to provide notice in order to preserve rights under the contract.

Even on well managed projects, however, notification obligations are not always met. And while this can be detrimental to a party's interest, there are limitations on the enforceability of notice requirements. Requirement Narrowly Construed

The failure to comply with a notice requirement can have serious consequences - the forfeiture of rights under the contract. For this reason, courts will narrowly construe notice provisions, applying them only to the occurrences expressly delineated in the contract.

A 20-day notice of claim provision in the AIA General Conditions applied only to claims for extra work. It did not apply to claims for compensable delay because the clause entitled "Delays and Extensions of Time"did not contain a notice requirement. Osolo School Buildings, Inc. v. Thorleif Larsen & Son of Indiana, Inc., 473 N.E.2d 643 (Ind.App. 1985); CCM May 1985, p. 2.

Another written notice requirement in the AIA General Conditions, the owner's notification to the contractor of defective work within one year of substantial completion, was also limited to the warranty clause in which it was found. The notice applied to owner demands that the contractor return to the site and perform corrective work. But failure to give notice did not bar the owner's suit for monetary damages for defective construction. John W. Cowper Co., Inc. v. Buffalo Hotel Development Venture, 496 N.Y.S.2d 127 (N.Y.A.D. 1985); CCM March 1986, p. 3.

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