Like many commercial contracts, construction contracts often
include what is commonly referred to as a "No Oral
Modification"("NOM") clause. Such a clause is
intended to prevent oral variations to a contract, instead
requiring any variation to be agreed in writing by the parties.
As noted by Lord Sumption in Rock Advertising Limited v MWB
Business Exchange Centre Limited, which we shall look at in
more detail below, there are at least three commercial reasons for
including a NOM clause in a contract:
- It prevents attempts to undermine
written agreements by informal means;
- In circumstances where oral
discussions can give rise to misunderstanding and cross-purposes,
it avoids disputes not just about whether a variation was intended
but also its exact terms; and
