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 New York, a waiver of contract rights must be a voluntary and intentional relinquishment of a known right. This means that for a waiver to be effective, the party waiving the right must do so knowingly and with the understanding of the right being waived. New York courts generally uphold waivers if they are clear and unambiguous. Non-waiver clauses are also recognized and enforceable in New York. These clauses stipulate that the failure to enforce a right or provision does not amount to a waiver of that right or any future rights under the contract. Such provisions are designed to prevent parties from inadvertently losing their rights through inaction or forbearance. Non-waiver clauses are particularly common in insurance and commercial contracts, providing parties with the assurance that their rights are preserved even if not immediately enforced.