In three related judgments delivered on 27 May 2020, Justice Davies found in favour of the liquidators of Gunns Limited (in liquidation) (Liquidators) against creditors Badenoch Integrated Logging Pty Ltd (Badenoch),[1] Bluewood Industries Pty Ltd (Bluewood),

With the onset of closures and quarantines early this year due to the spread of COVID-19, businesses across the country were confronted with the issue of how to perform their contractual obligations while they were unable to operate under normal conditions (or, in some cases, unable to operate at all). In many instances, they could not.

For months, landlords and tenants impacted by the COVID-19 pandemic have wondered whether force majeure clauses in leases would excuse a tenant's non-payment of rent. On June 3, 2020, a Bankruptcy Court for the Northern District of Illinois offered us an early look into how courts might interpret such clauses in the midst of the current crisis. In In re Hitz Restaurant Group, No. 20-B05012, 2020 WL 2924523 (Bankr. N.D. Ill. June 3, 2020), the Bankruptcy Court ruled that Executive Order 2020-7, the Stay-at-Home Order (the "Order") enacted by Illinois Governor, J.B.

Ever since governors across the country implemented Stay at Home orders to slow the spread of COVID-19 by closing non-essential businesses, experts have debated whether a force majeure provision of a lease would excuse a tenant’s obligation to pay rent.

Force majeure clauses and the doctrines of impossibility and/or impracticability remain among the most-discussed legal topics of the COVID-19 pandemic. Courts across the country, finally open, are grappling with those issues and giving some insight as to how these topics may play out in future cases.

Previously we reported on debtors’ appeals to bankruptcy courts’ general equitable powers for assistance in weathering the COVID-19-induced economic storm. (Our original article may be viewed here.) This trend remains and bankruptcy courts are demonstrating a continued willingness to entertain and offer such relief.

As COVID-19 spread across the globe like wild fire, many of its effects—including an economic downturn and emerging disputes risks—are being felt across markets.

The COVID-19 pandemic has led to a significant strain in the global markets. As "stay-at-home" orders are implemented globally, many economies have closed off, which has severely impacted numerous businesses. Inevitably, some companies have liquidated and many others are at risk of insolvency.

Ipso Facto is the sort of phrase people throw around when they're trying to sound more lawyery, but it's also the name of a regime that operates and affects your contractual rights when one of your contracting parties becomes insolvent.

Whether or not the impact of the COVID-19 crisis on a party’s ability to perform its obligations will constitute a force majeure event enabling them to claim relief depends on the terms of the contract as applied to the precise circumstances. Where there is no force majeure clause, a party may in rare circumstances be able to invoke the doctrine of frustration.