Global Vantage: It's good to talkApril 2020
Construction contracts almost always contain Notice provisions, which require one party to notify the other, or a third party, when certain circumstances arise. Compliance with Notice clauses is vital to ensure that both parties have sufficient time to consider and react to the events that have taken place.
Given the impact that the on-going Coronavirus pandemic has had on the construction industry, we expect to see a significant increase in the number of parties seeking advice on how to properly comply with their notification obligations. It is vital that both Contractors and Construction Consultants take advice on compliance as early as possible, as events such as the coronavirus could trigger Notice clauses that require, for example, Notice to be given within a certain time period where circumstances have arisen which could affect the performance of the Contract. Failure to properly notify an issue could mean that contractual relief in respect of the event is barred.
However, once you have notified (or been notified) of a matter pursuant to a Notice clause, it is important that, rather than thinking solely about how to protect your own position, you begin to think creatively about how the situation could be resolved in a manner that is mutually beneficial to both parties. A tsunami of contractual disputes is neither wanted nor needed by the construction industry. In this respect, we recommend that you maintain an open channel of communication regarding the event from the moment that notification is submitted / received.
By promoting co-operation, and using collaborative working practices, you may be able to resolve the matter quicker, and in a more cost effective manner, than would otherwise be possible. This could be fundamental in ensuring that the coronavirus pandemic, does not prove fatal to the commercial relationships that you have built nor fatal to your company. Ensuring that your conversations are not referred to later in arbitration or court proceedings maybe important and needs consideration.
For further information on anything covered in this publication, please contact Antony Smith.Download PDF