Patrick Shaunessy • January 12, 2023 • 12 minute read
A notice clause is a contractual provision that serves a basic but essential function by stipulating how and to whom notice must be given under a contract for it to be legally binding. Contracts will often specify notice periods for exercising rights under various provisions, including those for renewal, termination, default and assignment, and in all those cases notice must be given in accordance with the notice clause.
Because notice clauses are found in almost every kind of legal agreement, they are often overlooked during the negotiation process. While the notice clause may seem simple and straightforward, it usually contains detailed rules about the process for giving notice that must be strictly observed for the notice to be effective. These details become vitally important when one party needs to exercise rights under an agreement for which notice is a precondition. To illustrate, let’s say a small motor manufacturer is experiencing a supply shortage of copper wiring (a critical input for the production of its motors) because one of its suppliers is in breach of its delivery obligations under a supply contract. Before the manufacturer can obtain the benefit of any remedy under the contract (e.g., monetary damages to compensate for the disruption of the manufacturer’s business), it must provide notice of the breach and give the supplier 30 days to fix the problem. The manufacturer will want to provide this notice as soon as possible so that the cure period is triggered and either (1) the supplier corrects the problem within 30 days or (2) the manufacturer’s remedial rights crystalize at the end of the 30-day period. To ensure that notice is given in the appropriate manner for this purpose, the manufacturer will want to review the notice clause in the supply agreement and adhere to its requirements.
In most contracts, the notice clause appears as a standalone section, making it easy to find. The key pieces of information to focus on when reviewing the notice clause are:
Who needs to receive notice. The notice section will usually provide contact information for each party and it may also include contact information for one or more parties’ legal advisors. Typically, the official notice is sent to the relevant party or parties with copies going to their respective legal advisors as required. Sending notice to the legal advisors only may not be sufficient for it to be effective under the agreement (example 3 below, for instance, makes this explicitly clear). Note, as well, that the contact information for the parties may be found elsewhere in the agreement and, in that case, the notice section will generally state where this information may be found (see example 5 below, where the provision directs readers to page 1 for Tenant’s and Landlord’s respective mailing addresses).
The manner in which notice must be provided. Most contracts require notice to be in writing and then provide various options for effecting delivery – e.g., in person, by registered mail, by courier, by email, etc. The party giving notice can generally select one or more of these delivery options.
When notice is deemed to be given for the purposes of the contract. This is perhaps the most critical aspect of the notice clause, as it provides certainty regarding the timing of the notice. Even if the intended recipient has not actually received the notice, the rules set out in the notice clause may nevertheless deem that notice to have been given. Example 1 below illustrates this by stating that notice sent by registered or certified mail is deemed to have been given three business days after being sent (and by implication irrespective of actual receipt). Where notice is being given pursuant to a provision in a contract that stipulates a notice period, these deeming rules also determine when the clock starts running. Returning to the example of the small motor manufacturer above, let’s say the supply contract states that notice sent by courier is deemed to have been given after one business day. Assuming all other notice requirements are followed, the 30-day notice period will start one business day after the manufacturer sends notice by courier to the supplier. Finally, it’s important for senders to anticipate issues that may arise with certain modes of delivery due to these deeming rules. A contract may stipulate, for example, that notice sent by electronic means, such as email or fax, is deemed to be given when received (see example 4 below). Because notice is conditioned on actual receipt, the sender may consider using an additional delivery method to mitigate the risk of technological issues preventing or delaying receipt of any such electronic communication.
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Analyze 5 contracts for free arrow_forwardBelow are some examples of notice clauses from different kinds of agreements. While these examples do not necessarily cover the full range of notice clauses one may encounter, they are meant to illustrate the degree to which these provisions can vary from contract to contract. Where an example includes broader contextual language, the notice clause is highlighted in bold.
- Notice. All notices and other communications under this Agreement shall be in writing and shall be deemed to have been duly given when delivered personally, delivery charges prepaid, or three (3) business days after being sent by registered or certified mail (return receipt requested), postage prepaid, or one (1) business day after being sent by a nationally recognized express courier service, postage or delivery charges prepaid, to the parties at their respective addresses stated below. Notices may also be given by prepaid telegram or facsimile and shall be effective on the date transmitted if confirmed within twenty-four (24) hours thereafter by a signed original sent in the manner provided in the preceding sentence. Any party may change its address for notice and the address to which copies must be sent by giving notice of the new address to the other parties in accordance with this Section 16, except that any notice of such change of address shall not be effective unless and until received.
If to Licensor to:
Licensor Corporation,
123 Main Street,
Anywhere, State 12345with a copy to:
Big Law Firm LLP,
567 Main Street,
Anywhere, State 13579
Attention: Jane LawyerIf to Licensee to:
Licensee 345 Main Street,
Nowhere, State 01010
Attention: General Counsel
- NOTICES. Any notice or other communication which may be permitted or required under this Material Supply Agreement shall be in writing and shall be delivered personally or sent by United States registered or certified mail, postage prepaid, addressed as follows, or to any other address as either party may designate by notice to the other party:
**If to Supplier:
**Supplier Inc.
123 Main Street,
Anywhere, State 12345
Attention: Chief Operating Officer**With a copy to:
**Big Law Firm LLP
100, 234 Main Street W.,
Anytown, Province A1A 1A1
Attention: Joe Lawyer**If to Customer:
**Customer Inc.
678 Main Street,
Anytown, Province A1A 1A2
Attention: Chief Executive Officer
10.2 Notices. All notices and other communications hereunder shall be in writing and shall be deemed given if delivered personally or by commercial delivery service, or mailed by registered or certified mail (return receipt requested) or sent via facsimile (with confirmation of receipt) to the parties hereto at the following address (or at such other address for a party as shall be specified by like notice):
**(a) If to Acquirer, to:
**Acquirer, Inc.
123 Main Street,
Anywhere, State 12345
Attention: General Counsel
Facsimile No.: (123) 456-7890
Telephone No.: (123) 456-7890**with a copy (which shall not constitute notice) to:
**Big Law Firm A LLP
567 Main Street, 10th Floor
Anywhere, State 13579
Attention: Jane Lawyer**and a copy (which shall not constitute notice) to:
**Local Law Firm A
123 Uptown Road
Wherever 12345, Country
Attention: John A. T. Torney**(b) If to Target, to:
**Target Ltd.
555 Main Street, 5th Floor
Fifthsville, State 02021
Attention: Chief Executive Officer**with a copy (which shall not constitute notice) to:
**Big Law Firm B LLP
444 Main Street, 4th Floor
Fifthsville, State 02020
Attention: Joan L. Awyer**with a copy (which shall not constitute notice) to:
**Local Law Firm B
789 Downtown Road
Wherever 23456, Country
Attention: Joe Lawyer**(c) If to the Agent, or the Target Shareholders (after Closing), to:
**Agent LLC
456 Main Street, Suite 100
Nowhere, State 34567
Attention: Managing DirectorAny notice given as specified in this Section 10.2 (i) if delivered personally or sent by facsimile transmission shall conclusively deemed to have been given or served at the time of dispatch if sent or delivered on a Business Day or, if not sent or delivered on a Business Day, on the next following Business Day and (ii) if sent by commercial delivery service or mailed by registered or certified mail (return receipt requested) shall conclusively be deemed to have been received on the third Business Day after the post of the same.
- Notices and Communications.
All notices, demands, and communications required or permitted hereunder will be in writing and will be delivered personally, by facsimile, by email, by overnight courier or by registered mail, postage prepaid, return receipt requested to the respective representatives at Customer and Service Provider set forth below. Notices, demands and communications hereunder will be effective: (i) if delivered personally, on delivery, (ii) if delivered by facsimile, email or by overnight courier, upon receipt, (iii) if delivered by registered mailed, forty-eight (48) hours after deposit thereof in the mail addressed to the party to whom such notice, demand, or communication is given. Until changed by written notice, all such notices, demand and communications will be addressed as follows:
**If to Customer:
**12345 Main Street,
Anytown, Province
A1A 1A1
Attn: Chief Financial Officer
Fax: (123) 456-7890**If to Service Provider:
**13579 Central Avenue
Anytown, Province
A1A 1A2
Attn: Chief Executive Officer
Fax: (123) 456-7890
- Notice Procedure. All notices, demands and requests which may be or are required to be given by either party to the other shall be in writing and such that are to be given to Tenant shall be deemed to have been properly given if served on Tenant or an employee of Tenant or sent to Tenant by United States registered or certified mail, return receipt requested, properly sealed, stamped and addressed to Tenant at see page 1 or at such other place as Tenant may from time to time designate in a written notice to Landlord; and, such as are to be given to Landlord shall be deemed to have been properly given if personally served on Landlord or if sent to Landlord, United States registered or certified mail, return receipt requested, properly sealed, stamped and addressed to Landlord at see page 1 or at such other place as Landlord may from time to time designate in a written notice to Tenant. Any notice given by mailing shall be effective as of the date of mailing.
10.7 Notices. Any consent, notice or report required or permitted to be given or made under this Agreement by one of the parties to the other shall be in writing and addressed to such other party at its address indicated above, or to such other address as the addressee shall have last furnished in writing to the addressor, and shall be effective upon receipt by the addressee.
15.11 Entire Agreement; No Waiver; Notices. This Agreement and the documents referred to in it are the entire agreement of the parties with respect to this subject matter, superseding all prior or contemporaneous agreements. No failure or delay in exercising any right will be considered a waiver of that right. All notices and other communications must be delivered to the addresses designated on the first page of this Agreement.
12.5 Notices. All notices, requests, Claims, demands or other communications under this Agreement shall be in writing and shall be given or made (and shall be deemed to have been duly given or made upon receipt) by delivery in person, by overnight courier service, by facsimile or electronic transmission with receipt confirmed (followed by delivery of an original via overnight courier service), or by registered or certified mail (postage prepaid, return receipt requested) to the respective parties at the following addresses (or at such other address as shall be specified in a notice given in accordance with this Section 12.5):
**If to Buyer Parent:
**Buyer Parent, L.P.
616 Main Street, 6th Floor
Sixthsville, State 03032
Attention: General Counsel
Fax: (123) 456-7890**If to Buyer Sub, to:
**Buyer Sub LLC
616 Main Street, 6th Floor
Sixthsville, State 03032
Attention: General Counsel
Fax: (123) 456-7890**If to Seller:
**Seller, L.P.
4444 Main Street
Fourthtown, State 43210
Attention: General Counsel
Fax: (987) 654-3210Each Buyer may, by notice to Seller, and Seller may, by notice to each Buyer, change the address and contact person to which any such notices are to be given.
- Notices . All notices hereunder shall be in writing and shall be effective upon receipt. Notices may be sent by any reasonable means, including facsimile, to the Parties at their addresses and facsimile numbers written above. The Parties shall notify one another of any change of their address or facsimile number.
(k) Notice. Any notice required or permitted to be given hereunder shall be in writing (whether or not the operative provision states that the notice must be in writing), and shall be delivered to the parties at the addresses set forth in Exhibit C (or to such other addresses as the parties may specify by due notice to the others). Notices or other communications shall be effective when received at the recipient’s location (or when delivered to that location if receipt is refused). Notices or other communications given by facsimile transmission shall be presumed received at the time indicated in the recipient’s automatic acknowledgement; provided, however, if that time is after the receiving party’s regular business hours, then receipt shall be at the opening of business on the next regular business day. Notices or other communications given by Federal Express or other recognized overnight courier service shall be presumed received on the third business day after they are sent…
EXHIBIT C
Contacts InformationLegal Notice
PURCHASER:
PurchaseCo Inc.
358 - 1321 Central Avenue
Anytown, Province
A1A 1A3
Attn: General CounselT 123-456-7890
F 123-456-7891SUPPLIER:
Supply-It-All, L.P.
456 Main Street, 5th Floor
Anytown, State 13579
Attn: General CounselT 987-654-3210
F 987-654-3211
- Notice. Any notice which is required or permitted to be given under this Agreement may be given in writing by delivery in person or by ordinary prepaid mail by addressing the same to the party to whom it is to be given at the address set forth above or at such other address as such party may designate by notice in the foregoing manner and any notice so given shall be deemed to have been given on the day it is personally delivered or on the third day after it is mailed, as the case may be.
9.7. Notices.
Any notice permitted or required by this Agreement shall be sent by certified mail with return receipt requested to the parties at the following respective addresses. Notice shall be deemed to have been given upon actual receipt.
The Company:
HIJ Corporation
Attention: Chief Executive Officer
789 Uptown Drive, Unit D, Coasttown, State 98765The Manufacturer:
OEM Co. Ltd.
Attention: General Manager
Big Industrial Area E, Bayside Road, Harbortown, Country 878656
(h) Any notice or other communication to or by a party to this Agreement must be in writing whether given by personal service, post, facsimile or email, to the other party’s contact address as specified above or as otherwise notified by other party from time to time.
Section 6.1 Notices.
Any notice, direction or other communication given under this Agreement shall be in writing and given by delivering it or sending it by facsimile or other similar form of recorded communication addressed:
(a) To the Manager:
Big City Commercial Bank Inc.
777 Downtown Rd. W., 4th Floor
Big City, Province A2A 3A3
Attention: Executive Vice-President
Facsimile: (123) 456-7890(b) To the Distributor:
Big City Securities Inc.
222 Oldtown Rd. W., 7th Floor
Big City, Province A2A 3A4
Facsimile: (123) 456-7891Any such communication shall be deemed to have been validly and effectively given (i) if personally delivered, on the date of such delivery if such date is a business day and such delivery was made prior to 4:00 p.m. (Toronto time) and otherwise on the next business day, or (ii) if transmitted by facsimile or similar means of recorded communication on the business day following the date of transmission. Any party may change its address for service from time to time by notice given in accordance with the foregoing and any subsequent notice shall be sent to such party at its changed address.
15.2 Notices
Aside from daily operational and quality assurance communications, all notices and other communications required or permitted to be given under this Agreement shall be in writing and shall be delivered personally or sent by (a) registered or certified mail, return receipt requested; (b) a nationally-recognized courier service guaranteeing next-day delivery, charges prepaid; or (c) facsimile (with the original promptly sent by any of the foregoing manners). Any such notices shall be addressed to the receiving Party at such Party’s address set forth above, or at such other address as may from time to time be furnished by similar notice by either Party. Any such notice or communication shall be effective upon such personal delivery or delivery to such courier, upon transmission by facsimile, or 5 days after it is sent by such registered or certified mail, as the case may be. Copies shall be sent in the same manner as originals.
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