You’ve been served. Or have you?.

It is a rite of passage for many students to leave submission of an important assignment to the last minute. For some, this habit continues later in life.

One example is the delivery of notices under contracts. Contractual provisions commonly require certain notices to be served by a particular date to be effective. For whatever reason, parties often wait until the eleventh hour, inevitably leading to disputes regarding delivery and timing of service.

Are you being served?

If served with an ‘unfavourable’ notice under a contract ostensibly at the eleventh hour, it is advisable to consider whether that notice was validly served.

This will often depend on the notices clause (if any) in the contract, otherwise statutory presumptions may apply.

The best defence is a good offence

Contracting parties should not gloss over notices clauses. The importance of carefully considering their potential effect should not be undervalued.

Although typically buried in the ‘boilerplate’ provisions of a contract, a notices clause should exhaustively provide for the manner in which delivery and receipt of notices pursuant to the contract will be deemed to take place.

Otherwise, statutory presumptions may govern the circumstances with potentially disastrous results for the sender or recipient.

Statutory presumptions

Unless specifically contracted out of, there is a rebuttable presumption that applies to articles sent by post. If correctly addressed to a person’s Australian address and sent by prepaid post, they are generally presumed to have been received at that address on the fourth working day after being posted.[1]

The Electronic Transactions (Victoria) Act 2000 (Vic) also provides for certain presumptions regarding the sending and receipt of electronic communications.

Where these presumptions are not displaced by a contract’s deeming provisions, evidence of delivery or non-delivery may have to be adduced or rebutted.

A house of cards

Where notices provisions are utilised, it is important to remember that the contracting parties are agreeing to displace statutory presumptions and, sometimes, substitute actual fact with a deemed state of affairs following certain events.

Interpretation of a notices clause is often the determiner of whether and when notices are considered validly served under a contract. For example, where a contract states that only particular modes of service will constitute valid service, if a party utilises another method of service of a notice, often such service will be deemed ineffective at law.

Disputes may therefore be avoided by expressly and exhaustively agreeing on acceptable and unacceptable methods of delivery and deemed receipt of notices. Although sometimes operating with harsh results, requiring strict compliance with a notices clause leads to greater certainty between contracting parties.

[1] See eg Evidence Act 2008 (Vic) section 160(1) and Acts Interpretation Act 1901 (Cth) section 29(1).

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Commercial & Corporate
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Posted on: 17 January 2018