The Law of Empty Promises

iStock/ Hreni
iStock/ Hreni

Some time ago, I started a list of “lies” that I have heard repeated to me. I am now up to #67. Among the items on the list are:

No. 33: “I am trying to be reasonable.”

No. 59: “I am not trying to tell you how to do your job.”

No. 21: “I thought I paid that bill.”

And the popular No. 12: “Don’t worry, I’ll take care of you.”

A variation of No. 12 frequently shows up in construction jobs where, for example, the electrical contractor raises an issue with the project architect or construction manager and gets told, “We’ll take care of this later.”

Often, the motivation to put off resolving an issue comes from a desire to avoid an argument or dispute. But there may be other reasons. The architect may not want to admit to an error in the drawings or is concerned about going over budget.

In one case, the architect verbally told the contractor that they would approve a change order and make sure the contractor was paid if the contractor could find a way to cut costs elsewhere. In other cases, the architect wanted to postpone any action on a formal change order because it would involve a time extension, and the architect did not want to upset the owner by admitting that the public school project would be delayed.

These promises of future resolution of a claim may cause you to waive your contract rights by your inaction. Your contract probably requires a written notice from you to the owner for unexpected extra work, and courts do enforce these clauses.

What if the architect told you that things would be worked out later? Shouldn’t you have a right to rely on these statements? The short answer is that these are unenforceable promises. The architect cannot modify the contract’s terms and conditions without the owner’s consent and cannot waive the owner’s right to a written notice.

An underlying problem is credibility. Can you convince a judge that an oral promise was made if the other side later disputes that? In addition, the “promise” may be seen by a court as being too vague to amount to a binding agreement, and therefore is not a promise at all.

But how do you respond to the architect’s suggestion that you don’t put anything in writing? Often, contractors are very willing to wait things out informally, regardless of what the contract says. You may even have had positive experiences with such oral agreements. There is also the desire to maintain a good working relationship with the architect. You may feel uncomfortable demanding that the promise be put in writing.

In one court decision, the contractor encountered a differing site condition—underground water unexpectedly appeared during conduit trenching. The contract required a five-day written notice to the owner as well as the architect and, within 20 days, a written estimate of cost and time impacts. The architect told the contractor to dewater as best he could and that if the problem persisted, something would be worked out so that the contractor would be “made whole.” What would you do?

The contractor in that lawsuit listened to the architect and proceeded without anything in writing about the problem and without sending a notice to the owner. The owner denied the contractor’s claim for extra dewatering work and the court held that the contractor had failed to comply with the contract’s notice procedures. A lawsuit by the contractor against the architect for the broken promise also failed. The court held that the architect’s language was so informal as not to be an enforceable promise.

Contracts contain numerous written notice provisions: For unforeseen conditions, interferences with other contractors, delays and suspensions of the work, to name a few. The time frames for these notices may differ, and there may be follow-up requirements. Contractors ignore these clauses at their own potential peril.

Owners have reasonable arguments for these notice clauses. They create a contemporaneous record of the event, giving the owner the ability to investigate and decide on a course of action. The owner also needs to know whether additional funding is required, and they may have to notify others that there may be a delay. A “promise” of “Don’t worry, I’ll take care of you” does not address any of these legitimate concerns.

It is not wise to ignore your contract’s clear directives. You don’t want to have to add another “lie” to my list.

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