Civil Impacts and Legal Figures to Mitigate the Impact of Breaches Derived from COVID-19
The health crisis caused by the “Coronavirus” (COVID-19) has impacted various sectors: economy, markets, businesses, employment, and the banking sector. The measures taken by governments worldwide have direct effects on the economy and society. In the case of Guatemala, regarding mobility restrictions, business openings, and the State of Calamity provisions, the consequences will also affect the contractual obligations that both businesses and individuals have acquired.
Contracts and contractual commitments must be considered starting from the following analysis: How can security and hygiene measures, restrictions on movement, and the halt of activities affect? Specifically, in the following aspects: 1) The fulfillment of the obligations contracted by both parties. 2) How are the agreed-upon deadlines affected? 3) Does the contract foresee any solution for situations like the current pandemic?
To understand clearly how contractual obligations can be affected by this situation, it is necessary to take into account some legal figures contemplated in our legislation that can be used to mitigate the impact of the measures implemented by the Government of Guatemala.
The first of these is force majeure. This figure refers to the impossibility of fulfilling obligations due to an event that could not be avoided, nor predicted, and that causes the breach of the contract. On the other hand, there is fortuitous event, which also refers to the impossibility of fulfilling obligations, but this is due to an unforeseeable event that, even if it were foreseeable, could not have been avoided. Finally, there is the doctrine of imprevision, which differs from the previous ones in that it refers to the change in the circumstances under which the contract was made, making the fulfillment of the contract excessively burdensome for one of the parties.
It is important to consider that the application of any of the above figures requires a thorough and specific examination depending on each contract. At LEXINCORP GUATEMALA, we are at your disposal to resolve any queries or provide legal opinions to address your concerns and guide you on how to mitigate the impact of these measures.
