In a court decision cited by some as the most significant Canadian decision to date with respect to COVID-19 business fallout, Cineworld Group PLC (“Cineworld”) has been ordered to pay over $1.2 billion for failure to follow through with a deal to acquire Cineplex Inc. (“Cineplex”). In December 2019, the companies entered into an agreement […]
Category Archives: Coronavirus-Related Corporate Contract Litigation
Can a Buyer Back out of a Share Purchase Agreement Due to COVID?
The COVID-19 pandemic has caused economic disruption impacting transactions where parties seek to abandon deals on the grounds that the business climate is materially different and thereby avoid existing contractual obligations. The recent decision Fairstone Financial Holdings Inc. v. Duo Bank of Canada involves the application of material adverse effect (MAE) provisions that are common […]
Commercial Tenant Prevented From Using Force Majeure to Escape Rent Obligations
We wrote about the issues of frustration and force majeure in our previous post called “Force Majeure and Frustration in Contracts Following the COVID-19 Pandemic” Force majeure clauses are dealt with through the law of contract. Such a clause needs to be an express term and will not be implied. These clauses act as a […]
Business Interruption Insurance & COVID-19
Many businesses take out insurance to cover losses that can arise due to fire or theft, including damage to equipment or property. However, it is equally important to consider the potential for extended periods of income loss if a business is forced to close temporarily. For example, if there is a fire, a business will […]
Resolving Legal Disputes During COVID-19
The fallout from the global spread of COVID-19 has had a major impact on every industry and profession throughout the country, including the legal profession. With Ontario courts closing to all but the most urgent criminal and family matters in recent weeks, those facing civil disputes classified as “non-urgent” have been left wondering when they […]
Force Majeure and Frustration in Contracts Following the COVID-19 Pandemic
COVID-19 has clearly had a significant adverse impact on the economy of Ontario, Canada and the global economy. Given the impact of social isolation and physical distancing, and the closure of non-essential businesses, the reality is many individuals and businesses will be unable to fulfil their ongoing contractual commitments. What are the available legal defences? […]