Notices of claims: Overview, definition, and example
What are notices of claims?
Notices of claims are formal notifications that one party sends to the other to assert a legal right under a contract—usually when a problem, loss, or dispute has arisen. These notices let the receiving party know that a claim is being made and often trigger timelines or procedures for resolving the issue.
Why are notices of claims important?
They help protect legal rights and set a clear record of when a claim was made. Many contracts require written notice within a certain time after a problem occurs—if the notice isn’t sent in time or doesn’t include the required details, the claim might be waived. Notices also give the other party a chance to investigate, respond, or fix the issue before it escalates.
Understanding notices of claims through an example
A supplier delivers defective parts to a manufacturer. The purchase contract requires the manufacturer to notify the supplier of any claims within 15 days. If the manufacturer waits too long or doesn’t provide enough detail, the supplier could argue that the claim is invalid. A properly worded and timely notice helps preserve the manufacturer’s right to compensation or replacement.
Example of a notices of claims clause
Here’s how a notices of claims clause may appear in a contract:
"Any claim arising out of or relating to this Agreement must be delivered in writing to the other party within thirty (30) days after the occurrence of the event giving rise to the claim, and shall include reasonable detail of the nature of the claim and the relief sought."
Conclusion
Notices of claims are a key part of contract enforcement. They formalize disputes, preserve rights, and start the clock on resolution procedures. Businesses should pay close attention to the notice requirements in their contracts—including format, timing, and content—to avoid unintentionally losing the ability to bring a valid claim.
This article contains general legal information and does not contain legal advice. Cobrief is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.