Q&As

The supply of components to my business from Italy is late and I don’t know when they will be delivered because of coronavirus (COVID-19). I am about to miss the deadline to supply my products to a customer, what can I do?

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Produced in partnership with Lynne Counsell of 9 Stone Buildings
Published on LexisPSL on 31/03/2020

The following Commercial Q&A produced in partnership with Lynne Counsell of 9 Stone Buildings provides comprehensive and up to date legal information covering:

  • The supply of components to my business from Italy is late and I don’t know when they will be delivered because of coronavirus (COVID-19). I am about to miss the deadline to supply my products to a customer, what can I do?
  • Breach of contract
  • Is time of the essence?
  • Termination for delay
  • Force majeure clause
  • Frustration
  • Summary

This Q&A assumes that both the contract with the supplier and the contract with the customer are subject to English law.

Breach of contract

There are two potential breaches in the scenario—that of the supplier of the components to the owner and that of the owner to the customer. The breach is the failure to supply the relevant goods or delay in doing so. The principles outlined below would be applicable to either breach.

The remedies available are damages for breach of contract for loss suffered and/or termination of the contract. See: Remedies for breach of contract—overview.

In the absence of a specific termination right covering the relevant circumstances, a contract cannot automatically be terminated by the innocent party in the event of a breach. In order to justify termination, the breach must be serious enough as to amount to a repudiatory breach. For further information, see Practice Notes: Termination for breach of contract and Repudiation.

If the contract has specific termination provisions in the contract, these should be reviewed to see if they apply. See Precedent: Termination clause and associated Drafting Notes.

Is time of the essence?

Time of the essence clauses are often dealt with by the courts as examples of conditions or intermediate terms, the breach of which goes to the root of the contract and is treated as repudiation. However, although there is a long line of

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