Hi - at my workplace we are mainly dealing with FX related claims that are being submitted as force majeure. In these cases, they are (b) - in that did the party have an opportunity prior to the FM event occurring to reasonably speaking, manage and treat the risk.
We have also launched a survey today which has already generated hundreds of responses and we will be putting out a report on the results early next week so please watch out for that.
I hope this helps and please do let us know if you have further specific questions.
• Cadent Gas Ltd
There are multiple ways to be honest, including Force Majeure clauses and Business Continuity obligations on the supplier which are regularly tested.
• Vaisala Inc.
We have recently added a statement to all quotes to customers with regard to COVID19, namely that it is now a 'known' event and given that the environment is ever-changing that status of your order may change, including for example the time from submission of order to delivery/performance. We will use all commercially reasonable efforts to notify you as soon as possible of any change. So perhaps something along those lines? Our sales and executive teams seem pleased that we are addressing it directly.
erdemir engineering management and co...
• Parker Hannifin Corporation, Aerospace Group
I would say yes. This 'Act of God' is causing many companies to shut-down temporarily.
• GKN Aerospace
Yes - in most cases it will be ( unless of course the contract excludes medical issues or similar)
• Norfolk County Council
Might be worth considering what your response was to previous pandemic flu etc and treating similarly
yes, I considered a supervening fact, would be impossible to predict the existence and its effects when signing a Contract...
for me it depends, if the party is from Wuhan, China where the local authorities have declared shutdown or curfew then it may be considered. however if the party is from somewhere not directly impacted with the virus then No. They need to show evidences of the impact which is hindering their obligation to perform the work.
• Pacific Gas and Electric Company
I would describe COVID-19 as an unforeseeable event. It would depend on the nature of a unique good or service to determine if a force majeure clause would apply.
I note your profile refers to "Moreland City Council", I assume Melbourne (Australia).
Note - this response references 'UK' practice and legislation, different rules may well apply in your jurisdiction.
In the UK consideration would need to be given as to whether the contract was let under a government framework (or similar 'public procurement rules'), if so there may well be restrictions in place as to whether you could extend further.
If it is under a Framework, in the UK you would need to offer a 'Direct Award' extension (if permitted). If it is 'non-framework' then you would almost certainly be able to extend subject to agreement with the supplier.
Assuming you can extend, doing so after the previous contract has expired is generally permissible as long as both parties agree; for 'neatness' I would suggest that the extension applies with 'retroactive effect' from the day the previous contract expired, so there aren't any 'uncovered periods'.
Hope this helps
NOTE: you need to be wary of anti-bribery and corruption laws - extending 'expired' contracts rather than running a competitive procurement process often leads to concerns being raised - you may well need to demonstrate that this is very much an 'interim and last resort' measure as a precursor to a full competitive procurement process.
• Victorian Council - Australia
Thank you, Steve
Thank you for the prompt reply!
I agree with your comments
Victoria's IBAC (anti-Corruption body) highlighted that as one of the red flags for corruption
Generally speaking, we do not extend contracts beyond their expiry dates, especially if all extensions have been exhausted.
I am coming to these special and few cases that we have to manage. I am trying to balance commercial needs and legal exposure if any.
Of course it depends on the legislation of each country.
In my case we have gone from avoiding having extensions or addenda to contracts to try as a first option to extend the contract through an addendum since there are many associated advantages such as having a long-term collaborative relationship with the contractor. Manjeand the risk of corruption we have achieved very good agreements to extend contracts.
Product replacement or discontinuation is obviously quite usual - but that doesn't alter warranty obligations. The manufacturer should have stocked sufficient to meet likely needs. Without knowing the value. It is hard to know whether it is worth pursuing them; right now it sounds like they are ignoring you in the hope you just give up.
Thanks for your viewpoint and I couldn't agree more with you on this.
However, they have actually discontinued the product and their revised e-catalogue confirms this. I am sure they understand that a Purchase Order from us would just add on to their revenue in multiples at best, to risk such ignorance. Of the 28 product categories they have supplied, the issue affects only 1 of the 28.
The query deals around with
(a) non availability of spare parts of the product and
(b) non availability of the product itself.
• Isle of Man Government
Experience suggests this will boil down to the terminology used within your warranty document. It may be unreasonable to expect a supplier to maintain full stocks for all warranty potential on discontinued products (Tim already mentioned value...). More commonly, suppliers offer repair or replacement with the direct alternative product. If the 'standard' warranty were considered unacceptable at the outset it would be appropriate to develop the warranty model to include a recommended spares holding based upon MTBF, or more onerously full replacement of the product range used including mobilisation costs. Either way both parties are fully aware of expectations and obligations from the outset.
Contractually speaking if the warranty document is deficient you are really only left with negotiation. An option being to approach the supplier for access to the original product production drawings and look to have bespoke replacements made.
As a compromise and considering the actual failure rate seems quite low (5# out of 1500#) - though in no way trying to belittle the frustration you must feel - are there visual aspects where use of the replacement product may be viable and use the original products from those locations for the more visible locations ?
1. Reply - Yes It happens when contractor's payment is to be made based on milestone basis and where delay from contractor's side concurrently delay from employer's side also during contract administration stage both parities contracts manager and PM don't sit to-gather to establish the delay attributed to which party, on other hand employer want the work to be completed with in laid completion dates. with found delay employ deploys third party manpower to complete work and adjust this cost from Contractor's Accounts under Employer's Claims.
2. Reply - can be replied based on type of contract is formed.
You can reach me offline over the email: firstname.lastname@example.org (Rajit Shah - Founder and Director, RPCPL)
Are the contracts customer contract? Perhaps it may be useful to present the contracts based on the unexpired residue of the term left and whether or not the consent of the customer is required (for assignment). Are the contracts being assigned to a third party? Will the customer have to consent to the assignment?
If you are terminating the contract, you may need to look at the requirements under the term of the contract that will allow you to terminate without liability.
How do you increase the price of the contract, assuming the change order varies the price? Suggest it's via a contract amendment. But, however you do it make sure it's legally enforceable!
from the similar situations, we have used change orders, what matters is here what is the object of change - increase in assigned resources, increase in delivery method,increase in delivery schedule, increase in scope of work. When the impact is on Resource/related service and requirements - we use change forms to update/prolong the current Statement of work. For me by nature Project Managers - they have the same work to follow-up on a Project timeline, budget, Scope - so to be assigned to a new project, it still for me sounds like to stay in the same role, only managing another project (with another timeline, resources, budget constrains).