Coronavirus Closures

Due to the coronavirus and COVID-19 outbreaks, Minnesota courts announced that they are postponing certain hearings to avoid risk to the public. Specific information can be found in the Minnesota Supreme Court’s March 13, 2020 Order. The order stated that appellate proceedings would occur as scheduled, including oral arguments. Pending jury trials would also continue unless a specific health risk occurred. Certain time-sensitive proceedings, such as in-custody arraignments and speedy trials would still occur. However, proceedings that were less time-sensitive would be postponed. In addition, the Court recommended use of teleconference to permit appearances by attorneys and parties. These recommendations apply to hearings scheduled between March 16 and March 30, 2020. It is unclear if further postponements will be announced.

What Legal Issues is Coronavirus Causing?

COVID-19, the illness caused by Coronavirus, is causing many issues for businesses. Supplies may be late or unavailable, and services may not be performed. These issues cause many unexpected costs and expenses to occur. If you are a business affected by Coronavirus, here are some legal principles that may apply to your transactions.

Breach of Contract

Most business transactions are done pursuant to a contract. It can be informal–where one business sends a request for services and another business provides them with an invoice. Or, a detailed, written contract can explicitly define the rules that apply to the transaction. In either circumstance, a breach of contract arises when a promise or responsibility goes unfulfilled, whether it’s the provision of services or the promise to pay for them. If a breach of contract occurs, excuses may exist that allows a party to avoid paying damages.

Force Majeure

Force majeure is a legal term for a contract clause that allows a party to avoid its duties if an unforeseen event occurs. These clauses can be vague or explicitly detailed. For example, if Coronavirus causes workers to call in sick and replacement workers cannot be found, that may be grounds to avoid contractual duties under force majeure. However, each contract has its own specific language. If a dispute arises, a court would look to the specific contract language to see what the parties agreed upon. If a pandemic or widespread illness is not listed, it may not be an excuse. However, collateral effects, such as governmental shut down of operations or disruption to the supply chain may permit avoidance of contractual duties. Because each case is different, it’s best to have a lawyer review the specific language in the contract and provide a legal opinion regarding the specific facts causing disruption. When drafting a contract, it’s best to avoid broad, vague terms and be precise regarding the circumstances allowing a party to avoid duties.

Business Contract Attorney

If you have questions about Coronavirus impact on business transactions, contact Eric Rice at (651) 998-9660 for a free consultation regarding your options. Eric is an experienced business lawyer who has advised companies regarding contract drafting and litigation options if a breach of contract occurs.