Find out how Covid-19 will impact contracts and what you should do for business continuity.
We have had many queries from members seeking advice about the effect of the lockdown on construction contracts. It is clear that the current lockdown and the government’s continuing response to Covid-19 will have a serious and ongoing effect on the industry, raising contractual issues that rarely come up in the usual course of business.
We encourage all parties to construction contracts to communicate openly and honestly to negotiate a way through these unforeseen delays and obstacles. We also recommend parties seek independent legal advice where there is any uncertainty or disagreement over how to proceed. Different options may apply depending on factors including the terms of the contract and whether it contains a ‘force majeure’ clause, the nature of the project, and the extent and duration of any delays.
There have been some helpful advisories issued by various organisations since the lockdown began, and you can access these at the links below. These give general advice around options and scenarios that may apply, depending on the terms of the contract and the effect on the parties of the government’s response to Covid-19. There is also advice about how the lockdown affects parties to NZS 3910 contracts specifically.
We are unable to provide specific legal advice to members or the public, but we encourage you to contact us if you have any questions. If we cannot answer them for you, we will do our best to point you in the right direction or offer practical assistance.