Jurisdiction(s):
United Kingdom

Russian invasion of Ukraine: impact on English law contracts, force majeure, illegality, MAC, frustration, UK sanctions compliance, SAMLA 2018 protection, notice mechanics and termination consequences

Published on: 23 March 2022

Published by a LexisNexis Dispute Resolution expert

Legal News

Article summary

Ukraine conflict—impact of Russian invasion and sanctions on English law contracts—frustration, illegality, force majeure & MAC

Does your agreement contain an illegality, force majeure or material adverse change (MAC) provision and, if so, has it been engaged? This turns on construction, so the orthodox approach applies—scrutinise the pertinent circumstances and the wording of the provision. What, precisely, is the operative occurrence? It might be a legal development (eg whether making payment would constitute a criminal offence) or a factual situation (routes are blocked, power is unavailable, the plant has been hit). Does that occurrence fall within the clause’s reach, expressly or by necessary implication? Many force majeure provisions enumerate events that qualify. An illegality provision may identify the system of law under which performance must have become unlawful. MAC provisions frequently do not delineate what is covered, relying instead on the plain sense of the expression. Determine whether the occurrence advanced to justify invoking the provision is captured. Where event lists appear, parties can dispute whether the occurrence relied upon must be of the same genus as any enumerated instances, or whether analogous but wider circumstances are enough, depending on context and the precise drafting of the clause in question...

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