Time of the essence—construction contracts
Time of the essence—construction contracts

The following Construction practice note provides comprehensive and up to date legal information covering:

  • Time of the essence—construction contracts
  • What does time of the essence mean?
  • How does time become of the essence?
  • Express provision
  • By serving notice
  • Implied term
  • Time of the essence in construction contracts

What does time of the essence mean?

Where time is 'of the essence' it means that the stated time for completion of an obligation in a contract is a condition of the contract. Failing to comply can therefore allow the innocent party to terminate the contract and claim damages. A construction contract is unlikely to include time of the essence provisions. Liquidated damages, rather than termination, will ordinarily be the remedy for late completion of construction works.

Where time is not of the essence, in the absence of other contractual provisions relating to time (or inadequacy of such provisions), there will only be an obligation to perform the contract within a reasonable time. Time is then said to be 'at large' (see Practice Note: Time at large in construction contracts).

How does time become of the essence?

Express provision

Time will be of the essence if the parties have expressly stated in the contract that it is to be so. In a construction project, a time of the essence provision could theoretically relate to completion of the whole works, or it might only relate to a particular part of the works, or a particular obligation. Simply setting a date for completion of the works, as is usual in a construction contract, will not be enough to make time of the essence in the contract—the contract must expressly state that

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