"Allocating Contract Risks of COVID-19."
In an article published online in Builder and Developer, Partner Jonathan Head discusses how developers can allocate contract risks through the uncertainty of the coronavirus pandemic, and whether COVID-19 fits into most force majeure clauses.
“There has been practically no mention of the prudential question of whether exercising a ‘clear’ contract right makes sense,” says Head. “While certain commonly used contract responses exist for the pandemic issues, a more enlightened developer may think twice before exercising them.”
Head further explains the quality, delay and cost issues that may arise as a result of the pandemic and advises builders and developers on best practices to handle such obstacles.
“As always, people apply the law, and some of those people have experienced great disruption and loss, making them more open to change-based arguments,” Head concludes. “Keep this in mind before taking a hard position on a ‘clear contract’ term that costs you money in the long run.”