Canadian Lawyer

September 2020

The most widely read magazine for Canadian lawyers

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Page 44 of 51

but a situation where it's impossible for the landlord to perform the obligation as the landlord is compelled by law not to perform." He also says the decision is possibly appealable on such grounds and, also, that the landlord had clearly provided a clause in the lease that said in a case of force majeure, the tenant continues to pay rent, although the clause in this case excused for delays, not non-performance, and was poorly drafted. He notes that the consequences of this decision could be quite significant. "It invites tenants to just not pay rent in any kind of event of this nature," he says, adding that he feels the decision should be limited to the facts of that case and that the relevant lease clauses were probably poorly drafted. Still, the decision underscores that "judges are humans, too, and they are sympathetic to what small businesses are going through." However, while perhaps an outlier, Papadimitriou says this case sheds light on how leases will be negotiated in the future, as both tenants and landlords will be looking at "more fulsome" force majeure clauses, often considered "boilerplate," to see how they refer to pandemics and cata- strophic events of nature that close businesses even when there is no physical damage. He also feels that there will "likely be a lot of insurance litigation coming out of Covid-19," a sentiment echoed by other lawyers. Baellor says that. while things are still in "very early stages," he has been hearing rumblings of litigation over business interruption cover, especially where parties who have bought coverage are being told that it only covers physical damage, unless it specifically states otherwise. At the same time, Witt notes that insurance companies "don't want to be setting precedents around their policies that would require them to pay — that is adverse to them," he says. "So, there would definitely be motivation on both sides to fight this in the courts." "Judges are humans, too, and they are sympathetic to what small businesses are going through." James Papadimitriou, McCarthy Tétrault LLP THANK YOU FOR YOUR NOMINATIONS! On behalf of Lexpert, we would like to thank our readers for taking part in the call for nominations for the 2020 Lexpert Rising Stars Awards. We are proud to celebrate exceptional young lawyers who have made outstanding contributions in their careers thus far. Winners will be celebrated and profiled in a Lexpert ® Special Edition in November. BE PART OF THE CELEBRATION For event information or sponsorship opportunities: Presented by Signature Sponsor Supported by Organized by

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