1. Overall
If the delivery deadline is missed, and this is due to circumstances of which the seller has the risk, the buyer may apply sanctions against the seller.
It is the buyer's rights in case of such delay Chapter VI deals with.
The provisions of Chapter V of the Standards also refer to provisions of the Purchase Act.
This means that in order to provide a reasonably exhaustive account of the provisions applicable in case of delay, one must also account for what is relevant in the Purchase Act.
It may be appropriate to remind that our tutor is intended to provide non-lawyers with sufficient knowledge to even deal with the most common issues and problems. In some cases, however, the regulations are so complex and legally characterized that users should contact a lawyer for assistance. In such situations, the supervisor should contribute to conscious and enlightened choices.
2. Rule mirror
The topic of this article is NS 8411 paragraph 16 and NS 8412 paragraph 12.
3. Delay — Definition
As mentioned in paragraph 2, delay is defined in NS 8411 paragraph 16 and NS 8412 paragraph 14, respectively.
The formulations of NS 8411and NS 8412 are somewhat different, but in principle they are identical.
It follows from NS 8411 paragraph 16, first paragraph, that delay occurs when the construction goods are not delivered or are delivered too late, and the reason for this is not due to the buyer or circumstances on the part of the buyer.
The same rule follows from NS 8412 paragraph 14, first paragraph, but there the delay relates to the seller's deadline for fulfilling his obligations. The provision refers to NS 8412 paragraph 11.3.1, which includes the option for the seller to assemble, and where a special deadline has been given for this.
As mentioned earlier, we treat the special rules on mounting in the thematic assembly for the special provisions of NS 8412.
The assumption that the delay must be due to circumstances in which the seller has the risk is stated in the provision's reference to NS 8412 paragraph 11.4, which deals with those situations in which the seller has the right to an extension of the deadline. These rules are peculiar to NS 8412 since the products are to be manufactured. Accordingly, they are dealt with in the thematic collection for special provisions of NS 8412, which you can read here.
In this article, we assume that the seller is overdue both in fact and in law. The construction products or the agreed products are not delivered to the buyer as agreed and this is due to conditions for which the seller is responsible and/or the risk.
In this regard, it is pointed out that these rules apply not only in those situations where a specific delivery time has been agreed. In such cases, delivery must be carried out within a “reasonable time” and then one must first determine what must be considered to be “reasonable”.
In NS 8411 paragraph 16, second paragraph and NS 8412 paragraph 14, second paragraph letters a — d, four alternative actions are listed. It's not like one option precludes the other, but we'll come back to that.
In letter a it is stated that the buyer requires fulfillment in accordance with the rules of the Purchase Act §§ 23 and 24, and this option is dealt with in part 4 below.
Paragraph b provides that the Buyer may claim compensation for any loss incurred by the Buyer as a result of the delay in respect of any daylight savings.
Letter c deals with the buyer's right to rescind the purchase, while letter d deals with the buyer's right to withhold its own performance.
We have dealt with the various options in the article “Buyer's sanctions in case of delay” that exists here.
In our view, it is not as natural to characterize the buyer's decision to demand fulfillment as a sanction, which is why we consider this option in this article.
4th. Fulfillment of the purchase
As mentioned in Part 3, the Standards' provision on the buyer's right to demand fulfillment in case of delay refers to sections 23 and 24 of the Purchase Act.
This is a natural starting point.
The Seller shall not be able to exempt himself from a delivery of an agreed product or construction product by invoking delays, and the Buyer shall of course have the opportunity to claim fulfilment despite the delay.
At the same time, it must be recognized that a delay can cause both buyer and seller challenges, and consequently there is a need for rules that safeguard the interests of both parties.
With that said, the starting point is that the agreement must be executed, and then Section 23 of the Purchase Act regulates the conditions that must be met in order for the seller to nevertheless release his liability.
First, the seller cannot be required to comply if “there is an obstacle that the seller cannot overcome”, cf. Section 23 (1) of the Purchase Act.
This is an objective term in the sense that it is required not that the seller is not to be reproached. Why the obstacle has arisen is also not relevant. However, the obstacle must be of such a nature that it cannot be overcome.
For example, if it is a construction item X for which the seller has been sold out and where the manufacturer cannot deliver new goods for several months, the starting point will be that the seller cannot overcome the obstacle. However, if it turns out that the seller can obtain the goods by himself buying them from a competitor, then the obstacle can be overcome.
If the product is to be manufactured, the seller will also be hindered in a way that cannot be overcome if the means of production are lost in a fire or for other reasons.
Second, the seller cannot be required to comply if it would entail a “such great inconvenience or cost to the seller that it is in material disproportion to the buyer's interest”.
In other words, it adds up to a trade-off between the interest of the parties.
Cost development is presented as an option in the provision. From experience, we know that the cost of building materials can change significantly. In an article on bygg.no from 23.8.2024 about how the prices of building materials have developed, a graph taken from “Plankepriser.no” is included.
It shows that the price trend of “top 250 construction products” increased by almost 50% from summer 2020 to summer 2021. Then prices decreased slightly and as of 21.8.24 the prices were 41.5% higher for these goods than 1.6.20.
The headline of an article in Dagens Næringsliv published 12.2.2023 is used “yo-yo awards” to characterize the price trend of construction products.
Taking this as a starting point, both parties to an agreement on the purchase of building materials must be prepared for the fact that prices can fluctuate greatly. If an agreement is reached where the goods are to be delivered at some point in time and a fixed sum is agreed which cannot be regulated, then at least we believe that a seller cannot release himself from his obligation to perform on the grounds that the prices have become so high that the seller's costs”This is in a significant way against the buyer's interest.” If the seller were to be able to release himself relatively easily from his liability — in violation of concluded agreements — then the buyer would assume all commercial risk and that is not the intention.
By the way, there is not much case law to be found about §§ 23 and 24 of the Purchase Act that can shed light on the points.
In other words, the main rule is that both parties are obliged to keep the agreement.
With this said, it is important to highlight Section 23 (3) of the Purchase Act where it states that the buyer loses his right to demand fulfillment if he “waits unreasonably long to advance the claim”.
The length of time that can be accepted will have to depend on a concrete trade-off. We will nevertheless assume that when such a situation occurs where there will be a delay of some duration, the buyer will have to consider what to do. In relation to the seller, he will have to decide, among other things, whether he wants to make a claim for compensation for any daily allowance and also whether he wants to cancel the contract.
It goes without saying that the buyer can not raise and at the same time demand fulfillment. Consequently, the deadline for requiring fulfillment cannot be shorter than the deadline for raising -- rather longer.
The fact that the buyer should engage in some kind of activity in such a situation is also substantiated by the fact that Section 23 (3) of the Purchasing Act does not establish any requirement that the seller must ask the buyer whether this will require fulfillment. It states, in short, that the requirement of fulfillment lapses (by itself) if the buyer does not comply with the deadline for advancing his claim.
In other words, the buyer must be compliant and notify the seller as soon as possible. In our view, this is also substantiated by the standards provisions on mutual loyalty obligations.
It is also worth noting Section 24 of the Purchase Act which gives the seller an opportunity to ask the buyer if he still wants the good/product in a situation where he is delayed.
It follows from the legal drafting and legal literature that such a request from the seller is supposed to contain an indication of when delivery can be expected.
If the buyer does not respond to the seller “within a reasonable time”, it follows from the provision that the buyer loses the right to “raise whether fulfillment occurs within the time specified”.
