This is a question that, perhaps inevitably, will affect everybody, in whichever sector they are working.  In addition to looking at contract terms, and trying to negotiate a resolution (perhaps by seeking to defer and re-arrange a booking or contract, rather than cancelling and losing a deposit), there are a couple of other points that may need consideration:

1. Check your insurance documentation, and, as appropriate, consult with your professional advisers, to see if any insurance claim might be made:    

  • Business Interruption Insurance: As the Government website https://www.gov.uk/government/publications/guidance-to-employers-and-businesses-about-covid-19/covid-19-support-for-businesses says, businesses should check with their insurance provider if they are covered. Many businesses are unlikely to be covered as most business interruption insurance policies are dependent on damage to property, which will exclude pandemics. Some businesses may have purchased a specific add on relating to notifiable diseases, but some of these will still specify damage to the building. Some businesses may have purchased supply chain or denial of access cover which may meet their needs in this case.

  • The Coronavirus Business Interruption Loan Scheme: The Chancellor has therefore set out a package of temporary, timely and targeted measures to support public services, people and businesses through this period of disruption caused by COVID-19.  This includes the Coronavirus Business Interruption Loan Scheme, to support long-term viable businesses who may need to respond to cash-flow pressures by seeking additional finance.  Further details will no doubt follow, but preliminary information is available on the Government website (above).

  • Critical Illness and Key Man/Person Insurance: Businesses should also check the terms of any critical illness cover or key man/person insurance that they may have, for personnel who might be incapacitated or unable to work, through illness or death.

2. Consider steps towards corporate recovery: we work closely with professional accountants and licensed insolvency practitioners who are especially trained to assist the management of a company in financial difficulties.  This can include everything from an agreement with creditors, to work through a difficult time, to a formal administration or, in extremis, (voluntary) liquidation. 

What people need, and quickly, is a review of the options and some concise and cogent answers.  That includes prevention, just as much as dispute resolution: and we hope that this newsletter includes some thought-provoking material, which may be of assistance.

We have made arrangements to ensure that we are able to provide a seamless and continuous service, with an agile working environment for our clients, as well as our solicitors and staff, during these difficult times.  We remain “open for business” – very much so – to ensure that we provide help and support to people that need it, when they need it.

The articles and case summaries are for guidance only and do not constitute specific legal advice.  If you have any concerns regarding any of the issues raised in these articles, or otherwise, please contact us for further information.

If you have any queries in relation to contractual obligations caused by the Coronavirus, please do not hesitate to contact any one of Peter Blake (pblake@prettys.co.uk, or 01473 298206) Graham Mead (gmead@prettys.co.uk, or 01473 298234) or Andrew Kinnison (akinnison@prettys.co.uk or 01473 298219).