Close new contracts at the time of the corona crisis: include a good force majeure clause and take into account possible effects of corona measures!
On Tuesday 17 March last, we published an article on whether the corona crisis qualifies as force majeure. This article discussed the importance of scrutinising and checking your own contracts and general terms and conditions. Among other things, on whether your force majeure clause provides sufficient protection for your business. This applies not only to existing contracts, but also and perhaps especially when concluding new contracts. You can read more about including a "corona clause" in your new legal documentation below.
Given that the impact of the corona virus and the corona measures taken are currently known worldwide, in most cases, contracts concluded from now on cannot invoke corona as a contingency. Therefore, if you wish to conclude a new contract now, it is more important than ever to include a well-formulated force majeure clause in your contract or general terms and conditions.
This is why it is important to explicitly include epidemics and pandemics in your force majeure clause. You can do this by, for example, as a contractor, including the following additional clause in your contracts and/or general terms and conditions as an addition to the force majeure clause already in place:
"Force majeure means all external causes, beyond the will or control of the contractor, which make timely, complete or correct performance of the contract no longer possible. The force majeure referred to in this article includes, but is not limited to [...] the consequences of epidemics and pandemics."
It is also important to make clear agreements with your contracting party already when entering into a contract, taking into account your risks and foreseeable problems due to the corona crisis. Because the consequences of this crisis are uncertain, it is wise to jointly consider the possible consequences the corona virus could have on both parties and the execution of the contract before concluding it. This could include delivery problems, price increases or staff illness. By making clear agreements with your contracting party in advance, you can avoid discussions afterwards that could cause problems for your company.
It is important to use a force majeure clause adapted to your company and type of contract. In contracts concluded from now on, corona cannot be invoked as a contingency in most cases. Therefore, it is important to explicitly add epidemics and pandemics to your force majeure clause. In this uncertain market, it is necessary to identify risks and make proper arrangements already when entering into the agreement.
Would you like advice or sparring on the risks for your company, contracts, general conditions or applicable force majeure clause? We will be happy to prepare tailor-made legal documentation in consultation with you, including a corona clause.
If you have any questions following this article, please feel free to contact us.