Corona – infection of your contracts?

The corona pandemic not only has personal consequences for each individual, but also far-reaching economic consequences. Events are cancelled, deliveries and services can no longer be provided. What rights and obligations do the contractual partners have under these exceptional circumstances?

Simply stating that a case of force majeure exists often does not help. Every case is special. Nevertheless, guidelines result from the law and case law practice:

Special contractual provisions on force majeure (so-called force majeure clauses)

The first look is always directed at the underlying contract, which in principle takes precedence over the statutory provisions. Once the parties have determined when a case of force majeure exists and what effects this has on their mutual rights and obligations, some clarity has already been gained. However, the prerequisites of the regulation must be examined in detail in each case, as well as its effectiveness. This is because unilateral regulations in general terms and conditions can be ineffective due to unreasonable disadvantage to the contractual partner. Then the legal provisions apply.

Claims for remuneration

If it is impossible for one party to perform the service owed, the other party is generally not required to pay for it either. The music group that cannot perform at the cancelled event is not entitled to the agreed fee. The forwarding agent, who cannot deliver his goods due to a border closure without exception, also goes away empty-handed. It becomes complicated if one of the contractual partners has caused the impossibility of performance or if the performance itself is still possible but the contractual partner is no longer interested in it. The hotel room booked for a congress can usually still be provided even if the congress is cancelled. In such cases, the contract may have to be adjusted or cancelled due to a disruption in the basis of the business.

Claims for damages

Only those who have at least negligently caused financial losses to others shall be liable for damages. The organizer is therefore not obliged to reimburse the exhibitor for hotel costs that have become pointless if the responsible authorities have prohibited the event. However, not all cases are so clear. In many cases, the authorities have made only non-binding recommendations - if at all - and left it up to those affected to decide whether to close down their businesses or cancel events.

There are no general answers to these and many other questions - but there are answers!
Do you need a quick and economical solution for your case at short notice?
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Dr. Benedikt Bräutigam
Tel.: +49 30 8 89 19-141
E-Mail: benedikt.braeutigam@bmh-partner.com

Dr. Matthias Kuballa
Tel.: +49 30 8 89 19-141
E-Mail: matthias.kuballa@bmh-partner.com

Dr. Annette Schwab
Tel.: +49 30 8 89 19-141
E-Mail: annette.schwab@bmh-partner.com