Contact

Can you cancel a contract because of COVID-19?

Back to top

Can you cancel a contract because of COVID-19?

Yes you can if it is objectively impossible to perform your contractual obligations and even in the absence of a force majeure clause in the contract. Importantly, each situation will depend on its own facts and the wording of the contract

30 Mar 2020 1 min read Dispute Resolution Alert Article

Also, in the COVID-19 crisis specifically, developments must be considered carefully before concluding that there is an impossibility of performance or the triggering of a force majeure clause. Claiming impossibility or force majeure incorrectly could be a breach of contract and could give rise to a damages claim against you. In particular any impossibility of performance must be absolute and it is any event, including COVID-19 and its consequences, that could bring about an impossibility or force majeure provided it is unforeseeable with reasonable foresight, unavoidable with reasonable care and not the fault of either party.

A force majeure clause in a contract will take precedence over the common law and care must be taken to comply with any agreed time limits or process requirements set out in the contract.

The information and material published on this website is provided for general purposes only and does not constitute legal advice. We make every effort to ensure that the content is updated regularly and to offer the most current and accurate information. Please consult one of our lawyers on any specific legal problem or matter. We accept no responsibility for any loss or damage, whether direct or consequential, which may arise from reliance on the information contained in these pages. Please refer to our full terms and conditions. Copyright © 2024 Cliffe Dekker Hofmeyr. All rights reserved. For permission to reproduce an article or publication, please contact us cliffedekkerhofmeyr@cdhlegal.com.

You might also be interested in

9 Apr 2024

by Lydia Owuor

Note to lenders: Strengthen your securities by transitioning GLA titles

Consider a situation where a lender is processing a financial facility secured by two properties within the Government Lands Act (GLA) land regime. On one hand, they receive a converted GLA title, while on the other hand, they encounter a Form LRA 33 transfer instrument as the title document. The lender is suddenly faced with a dilemma: how do they reconcile the deferring formats and ensure that both titles are equally credible and secure? This underscores the important question about consistency, reliability and legal interpretation addressed in our previous article on transitioning GLAtitles. 

Real Estate Law

3 min read

7 Nov 2024

by Mbonisi Ndlovu and Thobeka Dhlamini

Justice and Public Interest on the Mic - Episode 2 - Trusts & Estates

Since 2011, CDH's Pro Bono & Human Rights practice (Pro Bono practice) has been at the heart of our firm's commitment to making a real difference. Over the past decade, our Pro Bono practice has passionately championed the cause of public interest, providing pro bono legal support to clients in need. The decision to establish a dedicated practice was motivated by our belief in giving back to the communities in which we operate and in the power of the legal profession to spark positive change.

Pro Bono & Human Rights

11:02 Minutes

10 Dec 2024

by Stella Situma and Christine Mugenyu

Lender’s victory: Essential strategies for effective security enforcement

On 11 November 2024, the High Court in East African Cables PLC v Equity Bank (Kenya) Limited KEHC 14009 (KLR) delivered a ruling that reaffirmed the strong position of secured creditors in enforcing security. When East African Cables PLC (the borrower) defaulted on a KES 1.7 billion loan that was granted to it by Equity Bank (the bank), the court upheld the bank’s right to exercise its statutory power of sale over the charged properties despite the borrower’s attempts to block the process. This ruling reinforces key legal principles regarding the enforceability of different types of security and offers valuable lessons for lenders on how to navigate borrower disputes and ensure smooth enforcement of their rights.

Dispute Resolution

5 min read

28 Nov 2024

by Heinrich Louw and Petr Erasmus

Can SARS limit access to a taxpayer’s premises when carrying out an inspection?

Judgment was handed down in the case of Alliance Fuel (Pty) Ltd and Inspacial Properties (Pty) Ltd v Commissioner for the South African Revenue Service in the High Court on 15 October2024. 

Tax & Exchange Control

6 min read

25 Jul 2024

by Alysa Bunting, Alecia Pienaar and Alistair Young

The ban on drones in angling

The fishing industry has experienced a drastic transformation since the introduction of drone technology and other remote-controlled devices in fishing practices. These innovative tools have revolutionised traditional recreational fishing methods as they are used to carry bait or lures to further locations and previously inaccessible fishing spots. This essentially allows the fishing range to be extended and enhances the efficiency of fishingexpeditions. 

Environmental Law

3 min read

23 Oct 2024

by Megan Rodgers, James Ross and Dean Tennant

The State’s energy champion: What the SANPC Bill is and where we are with it

On 14 October 2024 the Department of Mineral Resources and Energy (DMRE) (soon to be the Department of Mineral and Petroleum Resources) published an explanatory summary of the 2024 South African National Petroleum Company Bill (SANPC Bill) which confirms that the Minister of Mineral Resources and Energy intends to introduce the SANPC Bill in the National Assembly “ shortly ”.

Corporate & Commercial Law

3 min read

This website uses cookies to enhance the browsing experience. For more information, please see our Cookie Policy.

Accept Decline