Page 44 - Q&A.indd

Is a time bar clause in a contract
enforceable?

March 2017

“My company concluded a contract with a supply company
to supply us with imported tiles. Given their reasonable price
we bought a large shipment of the tiles. About nine months
Commercial later we discovered that a large number of the tiles were
broken. We approached the supply company to replace the
tiles, but they refused stating that our contract states that we
had to notify them of any defects or damage in the tiles within
6 months of delivery. Surely they can’t rely on such a clause
when they in fact delivered broken tiles?”

In general our law on prescription governs the period within which claims
expire. That said, our law of contract does allow parties broad freedom to
contract regarding various aspects of their relationship, including specific
timeframes for actions to be performed by parties.
It has accordingly developed over time that contracts often contain so
called time bar clauses which impose a time period within which a party
must give notice to the other regarding disputes or dissatisfaction, failing
which the right to claim relief lapses. Such a time bar clause in effect
replaces the periods specified by our law on prescription and that would
normally apply to such a claim. The inclusion of such a clause is primarily
intended to provide certainty in specific circumstances, although these
types of clauses can also hold onerous consequences for a party.
Our courts acknowledge that time bar clauses are enforceable, provided
the notice period is clear and reasonable under the circumstances. The
courts may also look carefully at the wording of the clause to determine
whether the clause excludes both delictual as well as contractual claims.
It may be that the wording of the clause is such that not all claims are
excluded by the specific wording.
In your case it does appear that as you failed to provide the required
notice to the supplier, the time bar clause will apply. The period also does
not appear to be unreasonable. However, whether all your remedies
have been excluded can only be determined on a closer reading of
the specific contract and clause. We would accordingly advise that you
consult an attorney to assist you in reviewing the contract and advise you
on the merits of your case.

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