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The Most Critical Factor to Establishing Waiver as a Defense


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3/3/2016
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I get asked about waiver a fair amount, although it is rare that the person asking the question calls this doctrine by its formal, legal name. (Usually, it is more along the lines of "Didn't they forfeit their right to complain ...?").

As you can probably guess, waiver most often comes up in the context of a breach of contract claim, with party A contending that that party B didn't strictly abide by the written agreement's terms, and party B responding that both parties had been ignoring to a significant extent those strict contractual terms, and therefore, party A effectively waived its right to complain later on.

The Single Most Important Factor in Determining Whether Waiver May Lie

Intent.

That is, without a doubt, the single most important factor in determining whether a party may be deemed to have waived their rights.

To that end, New York's courts have long, and unequivocally, held that

"The essence of a waiver is an 'intentional relinquishment of a known right.'"

What follows next should therefore not surprise anyone in the least:

New York's highest State court has both stated and held that

"[W]aiver requires a strong and clear showing of intent to waive.'"

When Waiver Will Not Lie

As a practical matter, this means that you cannot have waiver under the following circumstances:

  • When a party remains silent
  • When a party's statements or conduct is ambiguous, or open to a number of different interpretations
  • When a party is merely negligent in asserting (or failing to assert) its rights 

To the contrary, clear, affirmative actions that leave no doubt of the party's intention to waive its rights are needed.

The Takeaway

In light of the above, and the difficulties inherent in satisfying, or meeting the proof needed to establish waiver, it should come as no surprise that New York's courts have rarely found that a party had waived its rights. Naturally, this means that it remains an uphill battle for the party asserting waiver to prove that claim/defense in New York.



Category: Breach of Contract

Jonathan Cooper
Non-Compete, Trade Secret and School Negligence Lawyer

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