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Alison R. Mullins
In the terms and conditions of many construction contracts, giving written notice of a possible legal claim for damages is a prerequisite for filing suit later. Lack of proper and timely notice may completely negate a valid claim. A recent decision issued by a Virginia Circuit Court may remove some of the fear from such defenses by adding some flexibility and practicality to the often-rigid written notice requirements in contracts. The court ruled that, because the defendants had actual notice, lack of written notice was not a valid defense.
Lack of written notice, not an excuse
The VDOT argued lack of timely notice barred the contractor's claims. The contract between the VDOT and the contractor included a provision stating, "Early or prior knowledge by the department of an existing or impending claim for damages could alter the plans, scheduling or other action of the department, or result in mitigation or elimination of the effect of the act objected to by the contractor." The provision continued to require the contractor to provide written notice "describing the act of omission or commission by the department or its agents that allegedly caused the damages."
The VDOT bolstered their argument by pointing to statutes requiring notice of claims on state highway projects. The court agreed that the applicable state statutes required written notice. The court cited and agreed, however, with the Supreme Court of Virginia's holding that, as long as a required act was performed, even if it is not within the statutory time or mode, it will be adequate if the substantial purpose of the statute is accomplished.
The contractor argued the VDOT had actual notice of the claims and, thus, substantially complied with the purpose of both the contractual and statutory provisions for written notice. The VDOT never argued that they lacked knowledge of the contractor's claims. In fact, the court found that the evidence was clear that the VDOT and the contractor communicated regarding the contractor's claims during the performance of the contract work. These communications between the parties included meetings, written meeting minutes and memorandum of issues discussed. Further, the court found that the "VDOT did not suffer any prejudice from receiving actual notice as opposed to written notice."
In making the ruling, the court focused on the underlying purpose of the contract terms and statutory notice. The court found that the documentation of discussions, meeting minutes and claims demonstrated that the VDOT was aware of the contractor's claims. As such, actual notice satisfied the underlying contract and statutory purposes. Therefore, the contractor's claims were not barred by failure to provide written notice to the VDOT.
|Last Updated on Thursday, 03 September 2009 14:18|