Even though we’ve voted to leave the EU, this does not automatically make existing commercial contracts void.
Any changes to legislation that might affect contracts with EU partners will not be immediate, but will rather entail a process of gradual change over at least two years.
However, there may still be implications the validity or feasibility of an existing commercial contract. This is best taken on a case by case basis, especially as the exact nature of the new economic model is still being worked out.
In most cases, as with the arrangements for Brexit itself, the process will probably be one of negotiation. New contracts may need to be drawn up that are better suited to the new economic structure, or clauses added or amended.
There is a chance that someone might want to take advantage of material adverse change or force majeure clauses as grounds for terminating a contract. These clauses allow parties to break contract if an exceptional event outside their control means they are unable to fulfil the terms of the original contract. There is no guarantee that such an argument would be upheld – again, this is best examined on a case by case basis.
If you’re concerned about what Brexit means for your existing contracts, our expert team of commercial contract lawyers can help. We’re used to dealing with complex and challenging cases, and can advise you what’s best for your business.
Call us free on 0808 271 2602 or send our referendum team an email with any questions.