Could there be Relief of Contractual Obligations?
Despite Governor Cuomo’s Executive Order 202.8 requiring non-essential businesses to reduce in‑person workforce locations by one hundred percent (100%), businesses may find some relief from performance under their commercial leases and other contracts. Below are some avenues that may potentially provide relief for businesses:
Force Majeure in a Lease. A force majeure provision in a commercial lease allows for suspension of performance by either party because of certain specified unforeseen events. The clause may be invoked to allow a landlord or tenant to suspend performance of a time‑sensitive obligation, such as a “build out” obligation requiring a landlord or tenant to timely complete construction, and thus stall the commencement date of the lease. For more information regarding force majeure clauses, please see our companion alert here.
For guidance on the ever-changing laws that may affect your business reach out to Jamie Batt and our Business Law Team.