As a businessperson, you (like every other businessperson) rely on contracts to help manage the future of your business. Because of contracts, you can predict and plan for future revenues, rely on suppliers and supply chains, control expenses, obtain credit, keep information secret and obtain investors. Contracts enable “business as usual.” So, what happens when it’s no longer “business as usual,” as in the case of COVID-19? Take, for example, the case of manufacturing supply chains. According to a study commissioned by Fictiv, “[f]or the first time in modern manufacturing history, the critical variables of demand, supply, and workforce are all impacted globally at the same time.” According to that study, nearly ¼ of all manufacturing businesses have been unable to fulfill customer orders. But what happens if the customer is not content with “we are having supplier problems and can’t fill your order”? What happens when the customer realizes that they might be able to sue and recover not only the cost of finding and using a different supplier, but also damages that flowed from the supply failure, like suits against them by their customers? Contracts are often tough and “iron-clad” but they are not suicide pacts. There are a variety of ways to excuse performance when something like COVID-19 happens along. This article will briefly review some legal options available to you when the world becomes a cruel and hostile environment for the honest businessperson such as yourself.
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