00:04
the biggest challenge
00:06
when you’re dealing with a written
00:08
contract
00:09
first off oftentimes there are force
00:12
major clauses in contractual documents
00:16
and there is
00:17
some uh case law that supports the
00:21
proposition that if parties negotiated
00:24
a forced major clause in an agreement
00:27
that in effect they stipulated in
00:29
advance
00:30
what events of temporary commercial
00:34
impracticability or commercial
00:36
impracticability would allow either side
00:39
to excuse their obligations to perform
00:41
so
00:42
one obstacle is is and it depends on
00:45
what state you’re in and it doesn’t
00:46
apply in all situations is whether or
00:48
not there are any contractual provisions
00:50
that might govern
00:52
force major or this period of temporary
00:55
commercial
00:55
commercial impracticability i will add
00:57
that there is a case
01:00
that was a written opinion from the
01:02
united states district court northern
01:04
district of illinois bankruptcy division
01:07
just from early this spring that dealt
01:09
with
01:10
a covid related force measure
01:14
temporary commercial impracticability
01:16
issue
01:17
where there was a retail restaurant
01:20
operator that filed a chapter
01:23
uh 11 bankruptcy and there was a
01:25
receiver appointed
01:26
incident to the bankruptcy case that was
01:28
seeking to collect
01:30
post-petition rent pursuant to a lease
01:33
agreement
01:34
based on the rental rate in the lease
01:35
agreement and there was a forced measure
01:38
clause
01:38
in the lease that specifically said
01:41
that if there is a force measure event
01:44
that the force measure event will not
01:46
excuse the tenant’s obligation to pay
01:49
rent
01:50
even if there is a quote
01:55
event of temporary commercial
01:56
impracticability
01:58
the court in that case did not bite on
02:00
the argument that the forced major
02:02
clause
02:03
preempted the application
02:06
of an argument relating to
02:10
commercial impracticability and one’s
02:12
obligation to perform
02:14
and the court actually on a temporary
02:16
basis
02:17
rewrote the lease and allowed the tenant
02:20
to pay rent
02:22
based on their percentage of allowable
02:25
occupancy
02:26
allowed under governor pritzker’s
02:29
shelter in place order so if restaurants
02:31
were only allowed to be open
02:33
at 50 capacity or 25 capacity
02:37
or 50 of the time or 25 percent of the
02:40
time
02:40
the judge reduced the rent by that
02:42
percentage
02:44
that equitable defense is a
02:47
viable defense and is being pursued
02:51
in a wide variety of courts in multiple
02:55
jurisdictions throughout the united
02:56
states there are several large
02:58
lawsuits that were filed in the cook
02:59
county circuit court
03:01
the gap filed the lawsuit
03:04
with respect to over 70 stores seeking
03:07
to assert
03:08
temporary commercial impracticability
03:10
impossibility
03:11
resulting from covid to the performance
03:13
of their obligation on
03:15
a wide variety of leases there have been
03:17
retail restaurants that have filed these
03:19
claims
03:20
and so it is something that’s being
03:21
asserted in an effort to help
03:24
business owners deal with
03:27
the pandemic