Limiting the length of CRM OD Account and Contact Address fields

In CRM On Demand, I am attempting to limit the length of the account and contact address fields due to a restriction on the same in an integrated downstream application.  I am using workflow to update a custom field that has a validation rule that examines the address fields and this is working fine when triggered via the 'before modified record saved' event but is not working during the 'when new record saved' event.  I can see that the validation rule has executed since I am getting a workflow error whose Error Message contains the desired validation rule message.  I