Question 1

Does non-performance of a contract due to Covid-19 amount to breach of a contract or is it force majeure (Act of God)?

Accepted Answer

First, the contract must have a force majeure (act of God) clause that is crafted in a wide enough fashion to include an event like COVID-19. If the contract does not have a force majeure clause, the affected party may then rely on the common law principle of supervening impossibility. Ordinarily if a situation arises, without any act or fault of either of the parties to the contract, which renders the performance of an obligation by a party impossible, that party is excused from the failure to perform. It is important however to note that a party seeking to rely on this principle must show that the performance is really impossible and not just inconvenient, burdensome or economically heavy. So, a party can only invoke a force majeure clause if the consequences of the lockdown and/or the spread of the virus, renders contractual performance impossible.

Question 2

What is a secured transaction?

Accepted Answer

Most lenders like banks require a security before they will extend a loan especially if it is substantial. A secured transaction occurs when the borrower conveys a collateral e.g property to secure a loan. Should the borrower default on the loan, the bank may take possession of the specified property.

FREQUENTLY ASKED QUESTIONS

“Judge a man by his questions rather than by his answers.”
― Voltaire

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FREQUENTLY ASKED QUESTIONS

“Judge a man by his questions rather than by his answers.” ― Voltaire

CONTACT

LOCATION

OPENING HOURS

“Judge a man by his questions rather than by his answers.”
― Voltaire