Have you considered the impact of Covid 19 and the risk of Termination?

Asked 7 months ago
2020-04-03 07:08:31

Interesting paper by CMS on the legal implications of Covid 19 Worldwide [see the attachment below] and whilst it does cover the potential options on extension of time for both NEC and JCT for the UK, I found the issue on termination rights something that has not been discussed widely in a public forum as yet.

The Employer under the NEC may terminate after 13 weeks, whilst the default position under the JCT is two months. Obviously these are subject the amendment by the parties.

This issue will last much longer than 13 weeks, even when the lock down has ended, it will take a considerable longer time after the end of the lock down date for construction sites to get back up and running. I would not be surprised if re-negotiations are attempted by contracting parties and unfortunately, some contracting parties may not be around anymore.

Have you advised your client and/or considered the risk of termination as a result of Covid 19?


Attachments

  • COVID-19 implications for construction industry 31.03.2020.pdf ( 513 KB )