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COVID-19 Cancellations – Your Legal Rights – Force Majeure

Nicholas Pastro

In light of the unprecedented events taking place around Melbourne (and indeed the world), we’ve had an influx of queries from clients concerned about cancelling their holiday plans or wedding plans among a swathe of other consumer related queries pertaining to the outbreak of COVID-19.

It is for the first time in my career that I have found myself referencing the term “Force Majeure” – a civil law concept, defined as unforeseeable circumstance/s that prevents someone from fulfilling a contract. The circumstances must be unforeseeable, unavoidable and must make performance impossible. If the Force Majeure is prolonged or permanent then parties may postpone or cancel their agreement/contract.

Individuals should examine current agreements and contracts in this light and consider that some may be rendered null and void which would entitle parties to a refund of deposit monies or monies otherwise paid or at least postponement of performance.

In the event that the other party is unwilling to show flexibility in rescheduling, refunding or otherwise, parties should seek legal advice noting that monies are unlikely to be held in a trust account and therefore consideration should be given as to how to arrive at an amicable and practical solution. Individuals should try to work in with contracting parties collaboratively in order to assist them to remain in business. We should look after each other by providing mutual support during these extraordinary times and find mutually beneficial solutions to move forward.

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