A waiver of contract occurs when a party to a contract waives or gives up one or more rights or benefits it has under the terms of the contract. A party generally does not waive its rights unless the waiver is made voluntarily and with knowledge of the rights being waived—known as a “knowing and voluntary relinquishment of rights.”

Contracts often include a non-waiver paragraph or provision stating that a party’s (or the parties’) failure to pursue or exercise certain rights under the contract does not constitute a waiver of those or other rights under the contract. Such non-waiver provisions are common in insurance contracts and other commercial contracts.

In Arizona, a waiver of contract rights occurs when a party intentionally relinquishes a known right or conducts itself in such a manner that it is deemed to have given up certain rights under the contract. This waiver must be knowing and voluntary, meaning the party must have a full understanding of the rights in question and choose to forgo them without coercion. Arizona courts will generally uphold waivers if they are clear and unambiguous. Additionally, contracts in Arizona often include non-waiver clauses which specify that the failure to enforce a right does not amount to a waiver of that right or any other rights provided by the contract. These clauses are designed to protect parties from inadvertently losing their contract rights through inaction or leniency. Such provisions are enforceable in Arizona, provided they are part of the original contract and are consistent with the intentions of the parties. This is particularly relevant in commercial and insurance contracts where the precise terms of engagement and the rights of the parties are critical to the contractual relationship.