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Cabinet Office publish Guidance on responsible contractual behaviour in the performance and enforcement of contracts impacted by the Covid-19 emergency

Monday 11th May 2020


Information published by Cabinet Office 07/05/2020

Please note important updates from Government regarding “maintaining contractual performance” to protect public health. BAFE believes this includes fire safety requirements that should continue to be upheld in line with fire safety legislation in the interest of life safety.

 

This can be read in full here

 

Source: https://www.gov.uk/government/publications/guidance-on-responsible-contractual-behaviour-in-the-performance-and-enforcement-of-contracts-impacted-by-the-covid-19-emergency

 

Paragraph 13:

“Responsible and fair behaviour in contractual arrangements, described more fully in paragraphs 14 and 15, will contribute to the following objectives being met:

 

(a) where possible, maintaining contractual performance which is required to support the immediate response to Covid-19, protect public health, jobs and the economy;

 

(b) ensuring cashflow in those contracts is maintained, including to pay the workforce and individuals and businesses throughout the supply chain;

 

(c) where continued contractual performance is not possible or is not essential, ensuring those contracts, supply chains and markets can be preserved during the public health emergency, avoiding destructive disputes and insolvencies; and

 

(d) generally, ensuring that contractual and economic activity can be preserved and will be ready to continue in a sustainable way once the current emergency is over, supporting the restart of the economy and maximising UK productivity and growth.”

 

Paragraph 15:

“In particular, responsible and fair behaviour is strongly encouraged in relation to the following:

 

(a) requesting, and giving, relief for impaired performance, including in respect of the time for delivery and completion, the nature and scope of goods, works and services, the making of payments and the operation of payment and performance mechanisms;

 

(b) requesting, and allowing, extensions of time, substitute or alternative performance and compensation, including compensation for increased cost or additional performance;

 

(c) making, and responding to, force majeure, frustration, change in law, relief event, delay event, compensation event and excusing cause claims;

 

(d) requesting, and making, payment under the contract;

 

(e) making, and responding to, claims for damages, including under liquidated damages provisions;

 

(f) returning deposits or part payments;

 

(g) exercising remedies in respect of impaired performance, including enforcement of security, forfeiture or repossession of property, calling of bonds or guarantees or the initiation or continuation of insolvency or winding up (or equivalent) proceedings;

 

(h) claiming breach of contract and enforcing events of default and termination provisions (including termination rights arising by reason of the insolvency or potential insolvency of a party);

 

(i) making, and responding to, requests for information and data under the contract;

 

(j) giving notices, keeping records and providing reports under the contract (recognising that the need to keep records of contractual behaviours and decisions, including the behaviours referred to in this guidance, is important);

 

(k) making, and responding to, requests for contract changes and variations;

 

(l) making, and responding to, requests for consents (including funder consents);

 

(m) commencing, and continuing, formal dispute resolution procedures, including proceedings in court;

 

(n) requesting, and responding to, requests for mediation or other alternative or fast-track dispute resolution; and

 

(o) enforcing judgments.”

 

This information was published prior to the Prime Minister’s statement yesterday evening (10/05/2020):

BBC News: Johnson sets out plan to modify lockdown https://www.bbc.co.uk/news/video_and_audio/headlines/52605887/boris-johnson-sets-out-plan-to-modify-lockdown (external link)

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