As a result of COVID-19 the need to amend the terms of commercial relationships has increased exponentially for some businesses. It may no longer be possible to perform certain contracts due to changes in the law or the issue of government guidance. Supply and demand issues may mean profitable contracts now result in a loss and the parties simply cannot operate as they did previously. Depending on how the contract is drafted, it may not be possible (and most parties would not want) to simply terminate the agreement or to argue that the contract is frustrated. To do so may expose a business to significant financial liability. The parties to the contract should try to negotiate a commercially viable way forward. Once an agreement to vary a contract is secured, the parties need to think carefully about how to vary the contract effectively so that it is enforceable in the future.
Geraldine Ryan summarises the need to amend the terms of commercial relationships in the below video. You can read the full paper ‘reaching an agreement on varying a contract’ here.