It is essential to draft a contract clause regarding the time of performance or specifying the delayed performance of the contract. These clauses help to claim the termination of the contract proceeded with the damages. A minor setback can quickly escalate into far and more costly issues; therefore, the parties must agree on the repercussions of delays before work begins. Such clauses frequently are in construction contracts. Wherein, timely completion of a construction project at various stages is must create a single-family home or a big sports stadium.
Essentials of the clause dealing with Delayed Performance:
It must mention the date of the completion of the contract or any segment of the contract.
Such performance time must be agreed upon and consented to by all the parties involved in the contract.
The decided period of performance must be reasonable.
Set forth the details of work to be furnished within the allowed period of performance.
The contract clause dealing with delayed performances is essential for claiming damages in case of a breach. It is most importantly forming to carry out the complete contract in a reasonable time, and it helps to avoid unwanted delays. Such clauses help parties escape the embarrassment and economic losses likely to be faced due to extended performances of the contract.
Consequences of the delay
Delays in the performance of the contract results are as follows:
Delays at any stage of the contract create a breach of the contract, and the breach ends the existence of the contract in all respects.
The party at fault will be liable for all losses due to the delay.
In addition to the losses, the aggrieved party faces additional damages for delay.
Specific clauses of the contract allow punishments for inexcusable delays.
In some instances, the nonperformer is allowed additional time to complete the execution.
Damages for the delay are explicitly not easy to prove before the court of justice; thus, a clause for liquidated damages is often set in the contract. However, the absence of a clause for liquidated damage does not build an escape for actual damages resulting from a reasonably foreseeable delay at the time of the formation of the agreement.
Conditions of force majeure are exceptional events or situations beyond the control of the parties, such as war, strike, riot, crime, pandemic, or abrupt law changes. It prevents parties from fulfilling their obligations under the contract, and it wards off the parties from their liabilities and obligations.
Obligations due to delayed performance are exempt under the clause of force majeure. For instance, the clause of force majeure regarding delay of the contract lays as follows: “A party shall not be liable for any non-performance of this agreement due to delay. The delay of the period is due to causes beyond its reasonable control, including but not limited to acts of God, war, strikes, or labor disputes, embargoes, government orders, or any other force majeure event.”
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