Swine flu could provoke contractual disputes

15 October 2009

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21 July 2009

Buyers should check how prepared vendors are for an outbreak of swine flu to avoid supply chain disruptions, a lawyer has told SM.

Kelvin Balmont, senior associate at law firm Clarke Willmott, said the virus could lead to an increase in contractual disputes as staff illnesses may mean suppliers are unable to perform duties.

He urged purchasers to review the force majeure terms in their contracts, which frees one or both parties from liability when an extraordinary event prevents one or both fulfilling their obligations.

"We would strongly advise any business to review their terms and conditions and those of their suppliers to see where they stand in the event of such an outbreak," Balmont told supplymanagement.com. "If you're particularly reliant on one supplier you should spread the risk and have the ability to switch over."

He added that delivery and logistics firms are most likely to be affected by lower staff numbers, while catering suppliers should also be considered at risk.

Balmont was alerted to the issue when an event management supplier approached him with concerns that swine flu would affect its ability to perform contractual agreements.

The Department of Health will launch the National Pandemic Flu Service this week to provide advice on a website and from call centres.

 

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