The Impact of Coronavirus and How To Prepare
Already causing havoc in China, the threatened global pandemic of the coronavirus will likely cause disruptions of supply chains and other businesses involving trade, manufacturing, retail, and financial services. These are likely to affect construction in progress, or about to be in progress. And the effects at one level of supply will likely trickle down to the next level. So problems that may be beginning now might not be felt for several months.
While one possibility is to line up alternate suppliers in advance, which we recommend, this may prove impossible if the virus spreads as predicted. Aside from the disruption to construction, there will likely be resulting litigation as parties seek to recoup these unforeseen expenses at the courthouse. Most contracts, moreover, contain force majeure clauses that suspend performance for uncontemplated events beyond the control of the parties. Some of these provisions, however, require the party invoking the clause to declare an event of force majeure or else the defense is unavailable.
Our clients and potential clients need to be aware of this possibility by reviewing your contracts for any special requirements related to force majeure. As always Cokinos | Young stands ready to assist you throughout this process.
For more information, please visit: DNB Business Impact of Coronavirus