Contracts and COVID-19.

I've been hearing much about people being concerned about how their insurance, leases or other contracts should be viewed or interpreted in the current crisis.

I am frankly surprised by how often I have to ask "Well, what does the contract say about that?"

Often they do not know.

They have not read the document, or do not remember or understand the content.

I don't judge them for that at all... but times like now are when "the rubber hits the road" with a contract.

A contract is not an ornament- it is a tool.

It has a function.

It is used to document what the parties have agreed to do in relation to each other. It documents the obligations (responsibilities, burdens) they have assumed in relation to each other.

Yes... when you sign a contract you agree to accept obligations, to do things.

Is it not then important to know what you have agreed to do, or the implications of the obligations you have accepted?

The current crisis has created many difficulties but has also served to reveal a lot of phenomena which deserve to be brought to light... the common over-reliance on consumerism and spending, the health effects of common social practices and, in this case, the importance of knowing, understanding and agreeing to the obligations proposed in a contract.

I use "proposed" deliberately, because sometimes people think that a "standard contract" is an immutable unchangeable absolute.

It's not.

There is no such thing as a standard contract. Contracts can be negotiated.

Thankfully there has been some governmental recognition of the current crisis having impacted people's capacity to perform contracts... because in many cases they would otherwise be held liable regardless of their circumstances. A lucky escape on this occasion that should be viewed as a "near miss".

I cannot stress enough the importance of obtaining legal advice on any proposed contract BEFORE signing. Lawyers have specialist knowledge and skill in analysing proposed contractual terms and proposing alternatives. At LOUDON LEGAL we will even do it for a fixed fee.

COVID-19 has shown that we should always hope for the best, but prepare...really prepare... for the worst. This requires effort, time and some money... but you, your business and peace of mind are certainly worth it.

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