Covid-19: MCO and its effect on contractual performance — Dayana Najwa and Khaw Tzer Shern | Malay Mail

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MARCH 27 — In response to the Covid-19 pandemic, a nationwide movement control order came into force beginning 18 March 2020. Many businesses are left in perplex dealing with time-sensitive contracts. This article aims to shed some light on the effect of the Covid-19 pandemic to the inevitable...

Friday, 27 Mar 2020 06:58 AM MYT

Malaysians are also warned to brace themselves for potential further extension of the MCO depending on the pandemic’s situation in the coming weeks. However, the catch-all provision may only save you if its interpretation remains within the nature of the preceding specific circumstances. That means, if say “inclement weather” is the only supervening event spelt out as a force majeure event, one may not read"explosions" into it because the two are different in nature.

It is more difficult to establish frustration for the simple commercial reason that courts would generally seek to enforce contracts rather than dismissing them. It is great in a sense that it provides a more nuanced response to supervening events. For instance, it may temporarily suspend a party’s duty to perform a contract or it may even allow for an extension of time. To simply put, the contract is not automatically brought to an end.

 

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