DHCP RFC 1541 indicates that it is the responsibility of the DHCP client to notify the DHCP server with a DHCP_DECLINE transaction if the client determines that there is a problem with the DHCP parameters provided by the DHCP Server.
The RFC states:
The client receives the DHCPACK message with configuration parameters. The client performs a final check on the parameters and notes the duration of the lease and of the lease identification cookie specified in the DHCPACK message. At this point, the client is configured. If the client detects a problem with the parameters in the DHCPACK message, the client sends a DHCPDECLINE message to the server and restarts the configuration process. The client should wait a minimum of ten seconds before restarting the configuration process to avoid excessive network traffic in case of looping.
4.3.3 DHCPDECLINE message:
If the server receives a DHCPDECLINE message, the client has discovered through some other means that the suggested network address is already in use. The server MUST mark the network address as "not allocated" and SHOULD notify the local system administrator of a possible configuration problem.