COVID-19

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In a time of ongoing public uncertainty, we here at Forbes are committed to helping individuals and businesses with ongoing change. Below we have provided a comprehensive list of FAQs to address the latest coronavirus concerns. The questions and answers cover:


Commercial

Will COVID-19 be covered by Force Majeure?
 
 

This depends on the contents of your terms and conditions and commercial contracts more generally. Typically, most contracts will contain force majeure provisions which set out performing party will not be in breach of contract for failing to perform due to a "force majeure event". Epidemics and pandemics (the World Health Organisation has declared that Covid-19 is a global pandemic) will often be included; however, there could also be some merit in the argument that the Covid-19 outbreak is a "cause beyond the reasonable control" of the party in question.

The Covid-19 outbreak alone will not be sufficient to invoke the force majeure provisions within your contracts (i.e. enabling a party to terminate a contract that it no longer wishes to perform), as an assessment needs to be made on the impact that such has had on performing your contractual obligations. Most contracts also contain procedural requirements for the parties to follow in the event of a force majeure event taking place. For more information read our latest blog here.

Will COVID-19 be covered by Frustration?
 
 

An alternative [to force majeure] - but nonetheless more difficult to establish - argument would be that, as a result of the Covid-19 outbreak, your contractual obligations have become impossible to perform. This would be covered by the doctrine of frustration, under which if an event occurs (or a series of events, in the case of Covid-19 being the actions taken on a day-by-day basis by governments internationally), which goes to the heart of the contract such that it is beyond the contemplation of the parties at the time the contract was entered into, and renders performance of the contract commercially or practically impossible.

The courts are generally loathed to find that a contract has been frustrated, on the basis that - although the intervening event will no doubt have made performance difficult - there are often alternative courses of action available to the parties. This ought to be considered when reviewing your international supply contracts and the steps that have been taken to contain the spread of the virus across borders.

How will COVID-19 affect the supply chain?
 
 

With the above in mind, we would recommend that you conduct a review of your contractual obligations towards your suppliers, customers and intermediaries (as the case may be). The Covid-19 outbreak has no doubt already caused, or will cause over the coming weeks and months, disruptions to your supply chains. The international movement of goods and (particularly in light of the measures already taken by governments) people at the very least will be delayed and in some instances prohibited, which will of course have an impact on meeting agreed delivery dates.

Depending on the government's actions in the coming days (and proposed "lockdown", mirroring actions taken globally), similar can also be said for domestic supply contracts, in which we have seen a marked increase in demand on suppliers. It may well be the case that parties will rely on the force majeure provisions contained in their commercial contracts when seeking to limit their ongoing obligations to their suppliers and customers.

How can I deal with payments and cashflow issues?
 
 

On Wednesday 18 March 2020, the Chancellor announced a £330 billion support scheme that will be available to businesses throughout the Covid-19 pandemic. The scheme is changing on a daily basis; however, at the date of writing, it is available to all small and medium sized businesses (defined in the Companies Act 2006 as being those businesses with a turnover of less than £36 million, balance sheet of less than £18 million, which employ less than 250 employees). The scheme is wide-ranging, offering business rates holidays, business support grants of varying amounts, up to £25,000, in addition to providing financial support to those employers making statutory sick payments to their employees, which may assist with the short term financial difficulties that your business is facing.

Although it is always advisable to have efficient credit control facilities in place in any event, during the Covid-19 outbreak, we would recommend that you revisit your terms and conditions in order to ensure that going forwards, customers are required - where practicable and possible - to make advance payments for the goods and services that you will provide. This will reduce the potential of bad debts arising in the coming weeks and months.

Our overriding advice to clients is that the earlier its contracts can be reviewed for suitability, the more able it is going to be to mitigate any potential issues arising out of Covid-19.

Please see below some recent articles we have produced:

For more information or advice on what steps your business can take to protect itself contact John Pickervance, Head of our Commercial department via email or phone on 0333 207 1134. Alternatively send any question through to Forbes Solicitors via our online Contact Form.

Corporate

How will this affect Mergers and Acquisitions?
 
 

For mergers and acquisitions, the impact of coronavirus is too soon to tell. If a company's profits decline, buyers are likely to lower their asking price whilst sellers are likely to maintain the overall purchase price where possible. This is likely to cause a rift in buyer-seller expectation which may hinder the mutual cooperation of the transactional parties. Anticipated changes may see companies using debt financing mechanisms and other investment fund structures to fund future M&As. An influx in overseas investment may also be prominent, although this will no doubt depend on the international impact of the virus itself. The virtual lockdown may cause potential purchasers to reconsider their position until more certainty enters the market

How do I avoid a Breach of Warranties?
 
 

Ongoing updates to Government guidelines may mean that warranties given by sellers to buyers are no longer true or are potentially misleading. A failure to provide accurate warranties may leave sellers vulnerable to a breach of warranty claim. Sellers are encouraged to update warranties in sales and purchase agreements to ensure that they accurately reflect the value and nature of the business during and after COVID-19. For more information please see our latest article

Can I invoke a Material Adverse Change clause?
 
 

A material adverse change clause is seen as a 'catch all' clause that gives the right to a party to walk away from an acquisition if detrimental circumstances unexpectedly arise. Similar to a force majeure clause, whether this will invoke protection will depend on how a material adverse change is defined in the final agreement. Buyers are advised to include specific 'coronavirus related events' to make a MAC clause enforceable in the event that it needs to be relied on in the future. Examples of this may include the absence of employees, where there has been a 'material' change to a company's accounts, or material changes made to company contracts.

I can’t meet my filing deadlines, what do I do?
 
 

Companies House have provided additional support for Companies who may not be able to meet their internal filing requirements due to coronavirus. This may be due to staff shortages, prioritising emergency contingency plans, or closure of accountancy firms. Businesses are also encouraged to use the online filing services to facilitate with the continued filing processes as the Companies House workforce processes requests remotely. Read our article on changes to the Companies House filing systems here.

How may I use electronic signatures ?
 
 

In the wake of the pandemic virus and the current threat it poses, many businesses have leveraged remote access for its workforce. For many companies it's business as usual, and this raises the issue of whether documents can be signed electronically to avoid meeting in person. Following publication from the Law Commission, under English law, generally, electronic signatures can be used as an alternative to written signatures. Practical issues will arise however, if a document needs to be executed as a deed (and therefore signed and witnessed by an independent individual). For more information see our latest blog

Can my company still hold meetings?
 
 

Following recent Government advice to avoid large gatherings and to work from home where possible, companies are generally advised to postpone face-to-face meetings. Where general meetings or board meetings are necessary businesses are advised to utilize electronic means by use of online webcam services or via conference calls. Businesses are also encouraged to enforce proxy voting systems in the event that imminent business decisions need to be made. Other variations to holding a face-to-face meetings will be contingent on each company's Articles of Association.

What help is available for me?
 
 

The Government have released a series of packages and schemes to help a range of businesses through the COVID-19 disruption. Details of the help available includes:

  • Support for businesses paying sick pay for employees;
  • Support for businesses that pay business rates;
  • Support for businesses through the Corona Business Interruption Loan Scheme which replaces the Enterprise Finance Guarantee scheme currently offered;
  • Support for larger businesses through the Covid-19 Financing Facility; and
  • Support for businesses paying tax.

The combination of lending, grants and business relief will be assessed generally on a case-by-case basis, and businesses are encouraged to check the government website for further details. Further information can be found here.

Please see below links to some of our recent articles:

For further information or further advice on how we can help your Business please contact Pauline Rigby in our Corporate Department via email at pauline.rigby@forbessolicitors.co.uk or via telephone on 0333 2071131

Employment

What if a member of staff wants to go on volunteer leave?
 
 

The Coronavirus Bill introduced the concept of an "emergency volunteer", aimed at attracting volunteers to mitigate the effect of the coronavirus outbreak on essential health and community services and facilitate continued operation. The Bill introduced measures to incentivise volunteers in addition to protecting those who volunteer but are already in employment including the ability to take leave, protection from detriment, and compensation. Some workers and smaller businesses are exempted from the provisions, and there are timeframe restrictions in place governing any volunteer period.

The worker must provide written notice to their employer no later than 3 working days before the period of volunteering leave is due to commence and must specify the duration of leave. Whilst employees are not entitled to receive pay, other terms and conditions will be preserved, meaning that other benefits will continue to accrue during any period of emergency volunteering leave. There are rights to return and terms and conditions are protected. Provisions have also been put in place to protect employees from any detriment that applies also to redundancy situations. As such, the practical application of facilitating such leave is not always straight forward in such changing times, and legal advice should be taken if employers have any concerns.

Are employees choosing to isolate considered sick for the purposes of sick pay?
 
 

The Statutory Sick Pay (General) (Coronavirus Amendment) Regulations 2020 includes those "isolating themselves from other people in such a manner as to prevent infection or contamination with coronavirus disease, in accordance with guidance published by Public Health England, NHS National Services Scotland or Public Health Wales and effective on 12 March 2020 and by reason of that isolation is unable to work". This came into force on 12 March 2020 will remain in force for the next eight months.

From 13 March 2020, employees are entitled to claim Statutory Sick Pay (SSP), payable at £94.25 per week (at present), from the first day of sickness. To be eligible for this payment, an employee must be unable to work through sickness and/or through the requirement to self-isolate. In addition, an employee must earn the statutory minimum of £118. SSP is currently payable up to a maximum of 28 weeks and we are not aware of any extension to this at present.

Those employees who do not earn the statutory minimum of £118, are currently being encouraged to seek support via Universal Credit or Employment and Support Allowance (ESA).

Smaller employers can seek a degree of reimbursement from the Government and should take steps to clarify what entitlement they may have. Entitlement to full pay and/or enhanced sick pay (company sick pay) for those self-isolating will depend on the specific wording of the contract of employment. This may be difficult to determine for those that are choosing to self-isolate, as opposed to those that are ill and legal advice should be taken to ensure the correct approach is taken.

How do my employees access the 80% salary contribution?
 
 

Employees will only be in a position to access the contribution if they have been furloughed. The aim of the scheme is to keep jobs open for as many people as possible, and for part of their salary to be paid to those who would otherwise have been laid off. It is important to note that there is a cap of £2,500 per month.

Government guidance says employees must be designated as 'furloughed workers,' and notified of this change. However, changing the status of employees remains subject to existing employment law and, depending on the employment contract, may be subject to negotiation but it is anticipated that most employees will take a pragmatic approach in the circumstances. It is proposed that a new online portal will be set up by HMRC to facilitate the claims.

Employees should not work for you during their furloughed period, and the guidance is silent as to whether the employer should top up the remaining 20%. In the absence of further government guidance, the obligation could vary from contract to contract and advice should be taken.

We have produced articles to support you during COVID-19 please click the links below to view them:

For further information or further advice on how we can help your business please contact Emma Swan in our Employment Department via email at emma.swan@forbessolicitors.co.uk or via telephone on 0333 207 1154.

Commercial Property

I am unable to operate my business due to COVID-19 - must I still pay rent under my Lease?
 
 

Very few Leases will allow for a rent suspension in these circumstances. The likelihood is that rent is still payable by you.

You could approach your landlord to ask for a rent holiday or to defer your rent to a later date or to pay monthly instead of quarterly, but they are not obliged to agree to this. If any rent concession is agreed it is important to document this by way of a Deed of Variation or a side letter.

There is the possibility that your current business interruption insurance will cover you for non-payment of rent under your Lease as COVID-19 is now officially a notifiable disease.

I am a Landlord and one of my Tenants has informed me that one or more employees of their business has COVID-19. Am I able to stop them using the Property?
 
 

Generally, no. Commercial Leases allow the Tenant to quietly enjoy the Property and you cannot stop the Tenant from occupying the Property. An exception is that Public Health England may direct the closure of a building, and you should monitor their published guidance.

To assist in restricting the spread of the virus you may be able to limit the use of the rest of the building or certain areas of the building by setting reasonable regulations for the management of the building which all Tenants are required to abide by.

Dependant on the terms of your specific Lease, a Landlord may also be able to limit the level of services provided to Tenants due to the outbreak of COVID-19 and subsequent social distancing requirements.

Does my Lease account for any required additional cleaning or maintenance?
 
 

Most commercial Leases oblige the Landlord to provide specific services such as cleaning and maintenance of common areas.

However, most Leases will not include specific provision for cleaning and maintenance above what is normal - such as the deep cleaning and sanitising measures which many employers are now putting in place in reaction to COVID-19.

It may be possible for Landlords to claim back expenses from Tenants in relation to additional cleaning required at the building. This would be claimed back through the service charge payable by the Tenant, subject to any cap on contributions. This would depend on the wording of the service charge clause in your Lease.

What are my responsibilities in relation to health and safety in light of COVID-19?
 
 

The Control of Substances Hazardous to Health Regulations 2002 (COSHH) may possibly cover the current COVID-19 pandemic. The COSHH requires that you prevent workers exposure to hazardous substances by:

  • finding out what the health hazards are;
  • deciding how to prevent harm to health (risk assessment);
  • providing control measures to reduce harm to health;
  • making sure they are used;
  • keeping all control measures in good working order;
  • providing information, instruction and training for employees and others;
  • providing monitoring and health surveillance in appropriate cases;
  • planning for emergencies.

The COSHH can be viewed here:- https://www.hse.gov.uk/nanotechnology/coshh.htm

We recommend you review your Lease to confirm responsibilities in relation to removal of waste - particularly during this time when employees may be required to come into contact with items which may be connected to employees who have tested positively for COVID-19.

What happens if the Property is locked down due to the government restrictions and my Lease states that I cannot leave it vacant/closed for extended periods of time?
 
 

Check your Lease to confirm exactly what your responsibilities are. If your Lease does require you remain open, but your Lease also requires you to comply with statute (as most do), then closing to comply with your duties under, say, Health & Safety at Work legislation, is likely to override your obligation to keep open. Do also remember to notify your insurance company.

Your Lease may also require you to notify the Landlord if the property will be shut/unoccupied for a period of time.

I am required to undertake work on a Property under a Licence for Alterations - the works are time sensitive, needing to be completed within 6 months. Can I get an extension to this time limit?
 
 

A Licence for Alterations will usually include provision for an extension if the reason for the works not being completed is outside the control of the parties - a force majeure clause. Whether or not a delay caused by COVID-19 would be covered by any force majeure clause depends on the specific wording of the clause and whether this includes epidemics and/or pandemics.

The best course of action is to speak to the Landlord as soon as it becomes apparent that delays may be incurred due to the current situation. It is in the Landlords favour to maintain and improve the residual value of the Property.

For further information or further advice on how we can help your Business please contact Helen Marsh in our Commercial Property Department via email at helen.marsh@forbessolicitors.co.uk or via telephone on 0333 207 4236.

Housing & Regeneration

Are the Courts still open?
 
 

Yes. Courts are still open for business and are currently conducting hearings either by telephone, video link or face to face (with adequate protective measures in place).

How are the Courts dealing with Possession Cases?
 
 

The Courts are dealing with possession cases on an evolving basis but generally, it appears that many cases are being vacated / adjourned. Judges do not feel it is appropriate to evict tenants during the course of a national emergency and have them roaming the streets when they should be 'at home'.

Can new Possession Cases still be issued?
 
 

As far as we are aware, new cases can still be issued. Hearing dates may be listed later than would ordinarily be expected but cases can still be issued. Some organisations are taking the view that they will not pursue evictions at this stage so it is always worth checking with your own organisation as to its position on such matters.

How are the Courts dealing with urgent cases?
 
 

Urgent cases, including ex parte applications and committals, are still being dealt with. Hearings are taking place by telephone and the Court staff are accepting applications and sending approved Orders by email.

Can I apply to incorporate ASB into existing rent cases to speed things up?
 
 

You can still apply to vary a suspended possession order, if appropriate, to include ASB Grounds. The Court will still be unlikely to evict a tenant during the course of this pandemic in light of Government guidance to 'stay at home'. Urgent cases may still be dealt with in accordance with the Judge's discretion.

I think we are about to be inundated with complaints about noisy parties etc. In the light of the COVID 19 Government advice and to protect our well-behaved tenants, do you think ASB injunctions using anonymised witness evidence may be a response?
 
 

At the moment the police are stretched due to Coronavirus and so housing associations are going to be picking up most of the slack (more so than usual). It seems likely that we will see an increase of the use of warning letters and, in cases where violence has been used/ threatened, or there is a significant risk of harm, there will be an increase in the use of without notice injunctions. In terms of noise nuisance, there should be no reason why tenants can't download the noise App to capture evidence for use in support of 'on notice' injunction proceedings. However, warning letters are always a useful first step in tackling ASB. Anonymous evidence can be used in the usual way.

How can staff deal with victims and witnesses whilst working from home and what if witnesses can’t sign their statements?
 
 

Most staff will deal with witnesses and victims by either telephone or email. The vast majority of tenants will have access to emails and telephones and can give details of incidents in this way. Electronic signatures can also be used, if they are available / accessible. Witness statements can be posted to tenants with pre-paid stamped, addressed envelopes for returning it to officers. If there is no way of the victim signing their witness statement or getting it back to the officer dealing with the case, in some cases it will be possible for the housing management statement to exhibit an unsigned victim statement, with a section explaining why the victim has not yet been able to sign the statement but with confirmation that the victim has fully read the statement and confirmed by telephone or email that the contents is correct.

What can we do if several team members are off work or self-isolating?
 
 

A casework service can be provided by Forbes Solicitors to assist with staff shortages. Assistance with things such as case advice, warning letters, action plans and witness statements can all be provided.

Family

Can separated parents still share care of their children during COVID19 lockdown?
 
 

The Government has been placing pressure on society for social distancing and this has left many separated parents confused as to whether contact between parents, who do not live in the same household, can still be maintained.

The Stay at Home Rules have made the general position clear in that it is no longer permitted for a person, and this would include a child, to be outside their home for any purpose other than essential shopping, daily exercise, medical needs or attending essential work. However, the Government also issued guidance alongside the Stay at Home Rules to deal specifically with child contact arrangements. This guidance states "where parents do not live in the same household, children under 18 can be moved between their parents' homes".

Whilst the above establishes an exception to the requirements it does not mean that children must be moved between homes. The decision whether a child should be moved between homes is for the child's parents to determine after a sensible assessment of their individual circumstances has taken place. This assessment should include the child's present health, the risk of infection and whether there are any vulnerable individuals in either household who could be put at risk should this arrangement to move between houses take place.

Many people are very worried about COVID-19 and the health of themselves, their children and their extended family. Even if some parents think it is safe for contact to take place, it might be entirely reasonable for the other parent to be genuinely worried about this.

Ultimately, the best way for parents to deal with contact during these difficult and confusing times is to communicate with each other about their concerns and discuss practical solutions. It is, of course, noted that it is not always possible for parents to agree between themselves and disagreements will undoubtedly arise. Our experienced Family Solicitors are on hand to assist and provide further advice if required.

Can a Child Arrangements Order be varied during the COVID-19 restrictions?
 
 

There are many parents whose children are the subject of a Child Arrangements Order made by the Family Court and it is understandable that, due to the current COVID-19 crisis, they are concerned about their ability to meet the requirements of these Court Orders safely given the unprecedented circumstances that now apply.

The Court has provided a short statement intended to offer advice but, given that the circumstances of each child and family will differ, this advice can only be given in the most general form.

The Court confirms that first and foremost Parental Responsibility for a child who is the subject of a Child Arrangements Order made by the Family Court rests with the child's parents and not with the Court. If parents agree and exercise their parental responsibility to temporarily vary the arrangements set out in the Child Arrangements Order they are free to do so. It is, however, sensible for each parent to record such an agreement in a note, email or text message sent to each other.

If parents cannot agree to vary the arrangements set out in the Child Arrangements Order but one parent is sufficiently concerned that complying with those arrangements would be against current Government advice, then that parent may exercise their parental responsibility and vary the arrangements to one that they consider to be safe. If, after the event, the actions of a parent acting on their own in this way are questioned by the other parent in the Family Court, the Court is likely to look to see whether each parent acted reasonably and sensibly in light of the official advice and the current Stay at Home Rules which were in place at that time together with any specific evidence relating to the child or family.

Where, either as a result of parental agreement or as a result of one parent on their own varying the arrangements, a child does not get to spend time with the other parents as set out in the Child Arrangements Order, the Court will expect alternative arrangements to be made to establish and maintain regular contact between the child and the other parent within the Stay at Home Rules. Remote contact is one such alternative.

The Court's key message is that, where the current COVID-19 restrictions cause the letter of a Court Order to be varied, the spirit of that Order should still be delivered by making safe alternative arrangements for the child.

How can contact be maintained safely during COVID19 lockdown?
 
 

There are a number of temporary safe ways in which contact can still take place without the need for families to be put at risk and parents should see if it is possible to discuss sensible arrangements between themselves: -

  • Can a safe drop off/pick up location be agreed and arranged away from crowds giving consideration to the safe distancing guidelines recommended by the Government?
  • If both parties can agree that it would be best for the children to postpone the current arrangements, then this is an option. This will allow the child or children to stay safely in one home whilst maintaining regular contact with the other parent via alternative methods such as Skype, FaceTime, phone and text etc.
  • Can arrangements be changed from 'the norm' to make them more convenient for both parties? Again, this is something which the parents could agree between them and it could undoubtedly prove beneficial to one or both parents. For example - if the parent who has less contact is off work and/or working from home whilst the other 'main carer' has to continue working and therefore less able to facilitate the added childcare.

It is important to remember that the health and wellbeing of all concerned is paramount and everybody's situation will be different. Furthermore, these new arrangements will be temporary and normal contact can easily resume once this pandemic has passed us by.

Will my Private Law Family Court Hearing still go ahead during COVID19 lockdown (contact/children issues and financial matters)? It is listed in the next couple of weeks.
 
 

As a result of the COVID-19 emergency, the Family Court have notified us that they are going to suspend all non-urgent cases. This will ensure that any future hearings must comply with the Public Health England Guidelines to make sure staff and judiciary are safe. At the moment the Courts do not have a date when your case will be considered but, keep in regular touch with your Solicitors and they will notify you as soon as they know.

Some Courts are trying to put in place facilities to hold hearings remotely, i.e. via telephone calls or video links, but at present this is not set up for every Court.

I want to start divorce proceedings, am I still able to?
 
 

Yes! All applications for divorce are sent to the Liverpool Family Court. You do not need to attend Court and the process will be managed by us. We can arrange appointments with you by telephone to take your instructions. We have staff working in our offices to send documentation to the Court. You would need to be able to post your marriage certificate to us.

I want to apply to Court for a child arrangements order - am I better waiting until the restrictions are lifted or can I start the process now?
 
 

Of course, this is a matter of choice but you can start an application to Court now. In most cases before you start the application you need to attend a Mediation Information Assessment Meeting (MIAM) with a trained mediator. The mediation service is still running and they can conduct appointments by telephone. You can still make new applications to Court at this time. Court hearings are being conducted by telephone, where possible, and the same process will apply now as it does during other times.

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