COVID-19 leaves traces - The legal implications of the pandemic for construction projects

Not only since 11 March 2020, the day on which the World Health Organisation (WHO) officially declared the "coronavirus" and its spread as a "pandemic", have the consequences and effects of the pathogen also been felt in the economy. The coronavirus SARS-CoV-2, which causes the disease COVID-19, has long since spread to countries all over the world, affecting all areas and industries. The construction industry has also been severely affected by it in the meantime. Contractors are threatened by empty stocks, difficulties in the delivery of supplies and building materials, sickness-related absences of staff or quarantine measures imposed by authorities. In the further course of pandemic plans implemented by the government, the isolation of entire regions (risk areas) and the associated sealing off of construction is a potential course of action. Clients also run the risk of suffering considerable liquidity bottlenecks and financing difficulties.

To this day, the pandemic has reached unprecedented proportions. For this reason, extensive case law is not at hand for the legal assessment of the impact on construction projects in this context. It should also be anticipated that a standardized assessment of the factual and legal situation is not possible and that the special features of each individual case must be taken into account.

In this context, we would like to draw attention to a decree of the Federal Ministry of the Interior, Building and Community (BMI) dated 23 March 2020, which - with reference to federal building sites - addresses the legal consequences of the corona pandemic. The decree, which is immediately applicable, states, among other things, that all measures, which ensure that the construction sites continue to be operated, are of special importance. Essentially, it clarifies where a disruption to construction operations is attributable to the corona pandemic (force majeure within the meaning of Sec. 6 para. 2 no. 1 lit. c VOB/B). As these legal consequences result from the applicable laws and agreements (Building Site Regulation (BaustellenV), VOB/B), they also apply to all other construction sites.

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We have compiled on our website comprehensive information and recommendations for action in response to the legal implications arising from the coronavirus pandemic: Coronavirus - legal issues