A: Whether an engineering services contract may be terminated by a client without cause depends on the terms and conditions of the contract. Typically, engineering services contract will include a "Termination Clause" which may allow the client to terminate the contract for convenience (often found in contracts with government entities) or terminate the contract for cause. In the latter case, the agreement should identify the events or defaults allowing for termination after the client gives notice of a default and an opportunity for cure. Consultation with a qualified lawyer who can review the specific contract and circumstances is recommended to determine if termination was appropriate and whether there are remedies available if the termination was made without cause.
A: Whether an international contract may be terminated due to force majeure depends on whether the contract includes a "force majeure clause" that defines those events that are beyond the control of either party and would render contract performance impossible. Typical force majeure events could include, war, natural or man-made disasters, "acts-of-god", civil turmoil, etc. Disruptions to global supply chains due to the Covid-19 pandemic could be considered a force majeure event if it is identified as such in the force majeure clause of the contract. To determine the legal consequences and liabilities of terminating the contract the contract should be reviewed by a qualified lawyer to evaluate: whether supply chain disruptions due to Covid-19 qualifies as a force majeure event; whether there are notice requirements for declaring a force majeure event; whether the notice requirements (if any) have been properly satisfied; whether the Party declaring a force majeure event must take mitigating actions, etc. You should consult with a qualified lawyer to determine specific legal consequences and liabilities based on the actual terms of your contract.
