Herman du Randt, an associate in the Dispute Resolution Department at PH Attorneys, previously known as Phatshoane Henney, tells the OFM Business Hour that construction contract parties are often caught sleeping on the time-bar clauses outlined in their projects.

What do time-bar provisions in a construction contract entail?

In an article on PH Attorneys' website Du Randt explains that time-bar clauses require parties "to give notice to the building contractor, usually within a very short period of time, of the intention to dispute a set of circumstances, failing which, they lose their right to refer such a dispute for dispute resolution".

He says there are two elements to these clauses:

· One must give notice or at least lodge a claim within a specified timeframe;

· There must be an indication of the consequences of failing to give notice.

Why are time-bar clauses so prevalent in the construction sector?

The tight timeframes that exist in the construction industry are the reasons why the clauses are so prevalent. Missing deadlines can have serious financial repercussions for both clients and contractors.

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"Unreasonable delays can sink construction projects," warns Du Randt. "There is a high risk of incurring damages and losses if a project is not completed on time, especially if the project is expected to generate revenue once completed or completion payments are delayed. The high cost of having contractors and workers on-site without construction work proceeding should also be taken into account."

Is it possible to have an unreasonable time-bar clause?

Du Randt says the short answer is yes. "The Constitutional Court in the 2007 case of Barkhuizen v Napier determined that subject to certain requirements, time-bar clauses are enforceable. They must, however, provide reasonable and clear notice periods" he explains. 

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"Care should be taken when concluding a construction contract so that these provisions and their parameters are understood and appreciated. If necessary, consider involving a construction or commercial attorney to help provide clarity on these provisions and guide you on how to successfully ensure that any dispute is timeously raised and correctly dealt with contractually," says Du Randt.

OFM Business Hour