Did You “Notice”?

Many construction contracts stipulate the timeframe and the manner in which claim notices for extension of time must be served, failing which a claim may be ‘time barred’.

Some of the basic requirements to take notice of are: –

• Who shall give notice to whom by when?
• What information shall the notice contain?
• How shall the notice be served (e.g. oral, in writing, email, etc.)?

The following discusses the requirements of claim notices for extension of time in commonly used forms of construction contracts in Singapore, highlights the similarities and differences among them, and offers some practical guides.

PSSCOC

PSSCOC (Public Sector Standard Conditions of Contract) for Construction Works 2020 Clause 14.3 stipulates the following requirements for the Contractor to serve claim notice for extension of time: –

• The Contractor shall forthwith notify the Superintending Officer and shall in any case do so within 60 days of the occurrence of any of the events stated in Clause 14.2 that the Contractor considers has caused, causes or will cause delay to the progress or completion of the Works.

• In the notice, the Contractor shall inform, together with the appropriate Contract references, (i) the reasons why there will or may be delay to the completion of the Works or any part or section of the Works, (ii) the length of the delay and of the extension of time required, and (iii) the effect of the event on the programme accepted under Clause 9.

• The notice shall be served in writing following the requirements in Clause 37.2.

If the Superintending Officer considers the notice given by the Contractor is insufficient to enable him to decide on the Contractor’s claim, the Superintending Officer may require the Contractor to provide such further particulars and any further information which the Superintending Officer may reasonable require.

Both the submission of a notice and of further information as required in PSSCOC shall be conditions precedent to an extension of time.

SIA

SIA (Singapore Institute of Architects) Building Contract 2016 Without Quantities Clause 23(3) stipulates the following requirements for the Contractor to serve claim notice for extension of time: –

• The Contractor shall notify the Architect within 28 days of any event or Direction or Instruction which the Contractor considers giving him the entitlement to an extension of time.

• In the notice, the Contractor shall include a sufficient explanation of the reasons why delay to completion shall result.

• The notice shall be served in writing following the requirements in Clause 6(1) and subject to Clause 6(10).

The service of a notice is a condition precedent to the granting of an extension of time. However, such notice shall not be necessary if the Architect shall have already informed the Contractor in writing of his willingness to grant an extension of time.

SIA Clause 23(4) further provides: –

• The Architect may in writing request the Contractor for sufficient explanation, information, particulars or materials (e.g. records relating to the event causing the delay and the names of employees that have information that related to the events) to enable him to estimate the period of extension of time to be granted to the Contractor.

• The Contractor shall furnish to the Architect the requested information, particulars or materials within 28 days.

• Unless the Architect is in receipt of sufficient explanation, information, particulars or materials requested, the Architect shall not be required to decide and estimate the period of extension of time to be granted to the Contractor.

Nevertheless, quite different from the requirement to serve a claim notice, there is no express stipulation in SIA Conditions of Contract that the Contractor’s furnishing such explanation, information, particulars or materials requested within 28 days is a condition precedent to the granting of an extension of time.

Other Forms of Contract

In some construction projects, the Employers/ Owners prefer to use their own forms of contract.

One example of commonly encountered provisions governing the service of claim notice for extension of time is as follows.

“If it becomes reasonably apparent that the progress of the Works or any Phase or Section thereof is being or is likely to be delayed, the Contractor shall forthwith give written notice to [the Contract Administrator] of the material circumstances including the cause or causes of the delay and identify in such notice any event which in his opinion is a Relevant Event …

In respect of each and every Relevant Event identified in the notice given … the Contractor shall, if practicable in such notice, or otherwise in writing as soon as possible and in any case not later than [## calendar days] after such notice,

• Give particulars of the expected effects thereof;
• Estimate the extent, if any, of the expected delay in the completion of the Works or any Phase or Section thereof beyond the prescribed time resulting therefrom whether or not concurrently with delay resulting from any other Relevant Event;
• State the measures planned and/or taken to prevent or minimise delays; and
• Provide any further information which [the Contract Administrator] may reasonably require.

If the Contractor shall fail to comply with [this Clause], he shall only be entitled to extension of time to the extent that [the Contract Administrator] in his opinion has not been prevented from or prejudiced by such failure in assessing any claim by the Contractor for time extension.”

It is interesting to note that the above provision: –

• Requires the Contractor to give written notice “forthwith”, which means “immediately; without delay”, without stipulating a precise time period (e.g. 60 days in PSSCOC or 28 days in SIA).

Whether or not the Contractor has given written notice “forthwith from the date it became reasonably   apparent that the progress of the Works or any Phase or Section thereof was being or was likely to be delayed” is a matter to be determined based on facts and circumstances.

• Does not require the giving of written notice and of further particulars as a condition precedent to the granting of an extension of time.

Instead, the above provision expressly provides that the Contractor shall be entitled to extension of time but only to the extent that the Contract Administrator in his opinion has not been prevented from or prejudiced by such failure in assessing the Contractor’s claim for extension of time.

Notice Condition Precedent

A condition precedent is a contractual requirement that must be satisfied before a contractual right or obligation comes into existence.

The requirement to give notice as a condition precedent to entitlement to extension of time is often used as one of the management tools for construction projects with an objective to allow delay claims to be brought up as soon as possible and dealt with contemporaneously.

However, if the intent and purpose of the provision is to extinguish a right to relief, there must be express wordings clearly describing this intent and purpose in order for the provision to be enforceable. Further, such provision is usually required to be interpreted together with limitation clauses, the context and circumstances, and subject to general considerations of the law (e.g. Unfair Contract Terms Act, waiver, estoppel by convention, etc.)

The authors of Keating on Construction Contracts (Sweet & Maxwell, 10^th Ed, 2016) at paragraph 8-031 states:

“Many contracts provide that the contractor’s entitlement to an extension of time is dependent upon, amongst other things, the service of a notice within a stipulated time of an event causing delay. Courts are normally reluctant to construe the requirements as to the form and content of the notice required under such clauses too strictly and are unlikely to treat them as condition precedent to the making of any claim (as opposed to procedural requirements) absent clear language to this effect.”

Notwithstanding, where express wordings clearly describe the intention of notice condition precedent, the courts in Singapore have enforced such provision.

For example, in Ho Pak Kim Realty Co Pte Ltd v Revitech Pte Ltd [2010] SGHC 106, the High Court enforced the operation of Clause 23(2) of an earlier version of SIA Conditions of Contract. The learned judge decided that the Contractor’s letter did not amount to a request for extension of time as required in Clause 23(2) pointing out, among others,

• The Contractor did not even mention let alone make a request for EOT,
• The Contractor did not make any reference to Clause 23(2), and
• The Contractor’s letter was sent to the Architect twelve days after the issuance of the Delay Certificate.

In one of the arbitrations that the author participated in, the Tribunal acknowledged the enforceability of a provision containing notice condition precedent but did not enforce it because, in the course of dealing, the Respondent had never insisted upon the Claimant’s compliance with such provision as a precondition for any claims to be considered by the Respondent. Hence, the Tribunal found that there exists an estoppel by convention which prevents the Respondent from relying on any fact of failure to comply with such provision as a ground to reject any of the Claimant’s claims.

Practical Guides

1. The drafting of notice condition precedent clause should (i) prescribe the precise time within which the notice shall be served and (ii) plainly describe that the claiming party will lose its right under the clause, unless the notice is served within the time prescribed.

2. In the course of dealing, the Employer/ Owner/ Contract Administrator should insist upon the claiming party’s compliance of notice condition precedent clause in order for the Employer/ Owner/ Contract Administrator to rely upon it.

3. The claiming party should dedicate sufficient resources to monitor and ensure strict compliance with notice condition precedent clause in order to avoid risk that its claim may be ‘time barred’.