Transfer of contractual work in a construction contract

The case concerned a contract governed by NS 8406, and the issue was whether the contractual works can be regarded as taken over before a formal handover procedure has been carried out.

The Supreme Court first considered whether NS 8406 allows for takeover through use of the works without a formal handover procedure. Following an overall interpretation of the wording of the contract, its structure, purpose, and historical development, the Supreme Court concluded that, under NS 8406, takeover may take place only by means of a handover procedure under Chapter 24.

A handover procedure was carried out on 2 December 2022. The Supreme Court then considered whether the parties had entered into a supplemental agreement providing for an earlier takeover. The Court found that there were no sufficient indications in the parties’ correspondence or conduct to support such an agreement, whether express or implied.

The Supreme Court concluded that takeover did not occur until the handover procedure on 2 December 2022. The contractor’s claim was therefore not time‑barred. The appeal was dismissed, and Tesliåsen AS was ordered to pay the costs in the Supreme Court to Melhus Sparebank.

The judgment provides guidance on the interpretation of the requirement of a formal handover procedure in standard construction contracts.

Read the whole jugdment (Norwegian only) (PDF)

Area of law: Construction contract law, NS 8406 Chapter 24

Key paragraph: 46

Justices: Bull, Arntzen, Falch, Poulsen, Steen