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 Colorado, a waiver of contract is recognized when a party intentionally relinquishes a known right or conducts itself in such a manner that would indicate the abandonment of a right under the contract. This must be done knowingly and voluntarily. Colorado courts generally enforce waivers if they are clear and unambiguous. Non-waiver provisions are also upheld in Colorado, meaning that if a party does not exercise or delays in exercising a right, it does not imply that the party has waived that right or any other rights provided by the contract. This is particularly relevant in commercial and insurance contracts where such clauses are designed to protect the parties from inadvertently giving up their contractual rights. It is important for parties to be aware of these provisions and to act intentionally when they wish to waive any rights under a contract to avoid unintended consequences.