Please join me, Ian Ballon, Greenberg Traurig LLC Global IP & Technology Co-Chair and Stephanie O. Sparks, Hoge Fenton Privacy & Data Security and IP Chair for this terrific program on September 28, 2021 at noon, via Zoom.

We will focus on the most recent updates to California privacy law, data privacy class actions, practical cybersecurity issues, data breach class actions, risk issues for officers and boards of directors, and cyber insurance.

Register Here: https://buff.ly/3klQbM6

Sponsored by the Real Property. & Business Law Section of the Santa Clara County Bar Association and the San Mateo County, Alameda County and Marin Bar Associations. All members of the co-sponsoring bar associations will pay the $40 member rate.

 

Frank Burke, Esq.

Mediator | Arbitrator

ADR Services, Inc. – Your Partner in Resolution

fburke@adrservices.com

Scheduling: 415-772-0900 | Cell: 650-804-8300

http://www.adrservices.com/neutrals/burke-frank/

Available to handle your matters remotely via Zoom Conferencing.

Recognized in Best Lawyers in America for Mediation, Arbitration and Commercial Litigation

Online | San Francisco | Oakland | Silicon Valley | Century City | Downtown Los Angeles |Orange County | San Diego

Please join us for a timely update of new statutory and regulatory developments for retailers, landlords and cultivators involved in cannabis and hemp businesses. The program is co-sponsored by the Santa Clara County Bar Association and the International Cannabis Bar Association. You may register at the following link:  https://buff.ly/33HTXYh

An expert panel of leading cannabis lawyers will discuss recent regulatory issues; drafting commercial leases to be compliant with relevant laws and regulations and tips for landlords and for tenants; company formation issues; raising capital from investors; banking issues; loan issues; insurance issues; appellation of origin issues; supply chain issues; ancillary services issues and litigation issues.

I am serving as the moderator of this program. Our speakers are Lara L. DeCaro, of Leland, Parachini, Steinberg, Matzger & Melnick LLP; Shay Aaron Gilmore of  The Law Office of Shay Aaron Gilmore, and Katy Young of Ad Astra Law Group LLP, all of San Francisco.

 Please join us for this important update seminar. Again, you may register at this link: https://buff.ly/33HTXYh

Frank Burke, Esq.
Mediator | Arbitrator
ADR Services, Inc. – Your Partner in Resolution
fburke@adrservices.com
Scheduling: 415-772-0900 | Cell: 650-804-8300
http://www.adrservices.com/neutrals/burke-frank/

Available to handle your matters remotely via Zoom Conferencing.
Recognized in Best Lawyers in America for Mediation, Arbitration and Commercial Litigation

Online | San Francisco | Oakland | Silicon Valley | Century City | Downtown Los Angeles | Orange County | San Diego

 

 

 

The Restatement 2d of Contracts, adopted in 1981, added concepts of temporary and partial impracticability and also restitution or reliance damages to ameliorate loss.  While traditional application of such doctrines would lead to a finding that the contract automatically terminates, other cases state that if the frustration or impracticability is only temporary, then so is the hold on obligations (i.e. paying rent on office space when local ordinance forbids non-essential office use).  This will obviously be only temporary.

Thus, the Restatement 2d Contracts Section 269 operates to temporarily suspend a party’s obligation to perform during the period of impracticality or frustration, but typically does not discharge the obligation altogether. In other words, when the circumstances giving rise to the impracticality or frustration cease to exist, then the parties will be required to perform.

A condition which temporarily affects a party’s performance need not make the performance literally impossible, but the presence of facts that frustrate the purpose of the act are enough to trigger application of Section 269. Section 269 provides that when the facts giving rise to the impracticality or frustration cease to exist, a party will have a reasonable time to resume performance. Under Section 269, a party’s duty of performance is discharged when the period of impracticability or frustration ends, and full performance becomes overly burdensome.

In these cases, the parties may take advantage of Restatement Section 272 that suggests the possible use of restitution or reliance damages to cover potential losses.

It is conceivable that commercial and retail lessees might point to Section 269 as support for the position that they are excused altogether from rental obligations during the period when they are unable to access their premises or operate their business due to COVID-19, but when the premises were accessible and partial re-opening was allowed, a proportional reduction in rent might be the correct remedy.

Other commercial lease negotiation tools might include rent abatement with deferred payments; moving from a set base rent to a percentage of monthly sales; increasing tenant improvement allowances to implement social distancing; allowing the tenant to use a portion of its security deposit to help reopen or reconfigure; moving the tenant to a smaller space at less rent or larger space for the same rent; shortening or lengthening the lease; triggering “kick out” clauses which enable mutual cancellation; landlords seeking release of cotenancy or key tenant provisions which allow rent reduction based on lower foot traffic; smaller tenants insisting that they not be required to reopen or pay full rent until key tenants are open or replaced.

Other types of pandemic impacted contracts include construction contracts, real estate development agreements, supply contracts, sales of goods, consulting agreements, and event agreements.

Restatement 2d Contracts 269:

Temporary Impracticability or Frustration

Impracticability of performance or frustration of purpose that is only temporary suspends the obligor’s duty to perform while the impracticability or frustration exists but does not discharge his duty or prevent it from arising unless his performance after the cessation of the impracticability or frustration would be materially more burdensome than had there been no impracticability or frustration.

Restatement 2d Contracts 270:

Partial Impracticability

Where only part of an obligor’s performance is impracticable, his duty to render the remaining part is unaffected if

(a) it is still practicable for him to render performance that is substantial, taking account of any reasonable substitute performance that he is under a duty to render; or

(b) the obligee, within a reasonable time, agrees to render any remaining performance in full and to allow the obligor to retain any performance that has already been rendered.

 Restatement 2d Contracts 272:

Relief Including Restitution

(1) In any case governed by the rules stated in this Chapter, either party may have a claim for relief including restitution under the rules stated in Sections 240 and 377.

(2) In any case governed by the rules stated in this Chapter, if those rules together with the rules stated in Chapter 16 will not avoid injustice, the court may grant relief on such terms as justice requires including protection of the parties’ reliance interests.

Case Law

In G.W. Andersen Constr. v. Mars Sales, 210 Cal. Rptr. 409 (Cal. Ct. App. 1985), a contractor and an owner entered into a building construction contract. After the plans had been drafted, the city in which the building was to be constructed imposed a construction moratorium; but the parties were not aware of the moratorium when they later signed the contract. The court ruled that the construction delay did not discharge the owner’s obligation to pay a deposit, as the delay was not substantial.  The court also ruled that the fact that the delay created a risk of increased costs because of price changes in the construction industry did not entirely excuse performance, as such a risk was too speculative at that time. The court did hold that the owner was temporarily excused from paying the deposit while the impossibility existed.

In Maudlin v. Pac. Decision Scis., 40 Cal. Rptr. 3d 724 (Cal. Ct. App. 2006), the court stated that a company’s deficiency in retained earnings only rendered its ability to remit payment under a deferred compensation agreement “temporarily impossible,” so that the company’s payment obligation would not be discharged but “merely suspended —unless the delayed performance becomes materially more burdensome, or the temporary impossibility becomes permanent.” The Court stated that the California law on temporary impossibility mirrors the Restatement 2d Contracts section 269.

In Lohman v. Ephraim, No. B207755, 2010 WL 6901 (Cal. Ct. App. Dec. 30, 2009)(unpublished), the court rejected a defendant’s argument that a real estate purchase agreement was unenforceable because holdover tenants frustrated the delivery of the property, making performance impossible. The court stated that the holdover tenancy—a temporary condition—did not fully excuse performance: “When the obstacle to performance is only temporary, the duty to perform is not discharged but merely suspended until cessation of the impracticability. Temporary impracticability discharges the duty to perform only where performance after cessation of the impracticability would be materially more burdensome than had there been no impracticability . . .(Rest. 2d Contracts 269.)”

In 4900 Patrick Henry Drive Assocs. v. Keith Roofing., No. H032721, 2009 WL 1508515 (Cal. Ct. App. May 29, 2009)(unpublished), a contractor was hired to repair and replace a roof, discovered rotting beams, and suspended its work while another contractor was hired to repair the rotting beams. A rainstorm lead to water damage to the interior. The owner sued the roof contractor, alleging that it did not properly cover openings in the roof. The court ruled in favor of the contractor, finding that its performance was suspended because of the repair of the rotting beams. Citing Section 269, the Court ruled that the discovery of the rotting beams “made it temporarily impossible” for the contractor to finish its roofing work and, therefore the contractor could not be held liable for breach of contract on the water damage.

In Bush v. ProTravel Int’l, Inc., 746 N.Y.S.2d 790 (N.Y. Civ. Ct. 2002), the court, relying on Section 269, ruled that the plaintiff’s need to timely cancel a travel reservation was temporarily suspended because “New York City was in the state of virtual lockdown” following the 9/11 terrorist attacks. The court ruled that “where a supervening act creates a temporary impossibility, particularly of brief duration, the impossibility may be viewed as merely excusing performance until it subsequently becomes possible to perform rather than excusing performance altogether.”

Schaefer Lincoln Mercury v. Jump, No. 0005-05-86, 1987 WL 642758 (Del. Ct. C.P. June 8, 1987)(unpublished) In Schaefer, a lessee was required to make monthly lease payments on a vehicle. Nine months into the four-year lease, the vehicle was irreparably damaged, without fault by the lessee, and was unusable for the three months while it was in the repair shop. The lessor tried to provide a substitute vehicle, but the lessee rejected it and tried to terminate the lease due to impossibility of performance by the lessor. The court cited Section 269, ruling that the lessee could not terminate the lease because the period of frustration was only temporary. However, the court ruled that the lessee was excused “from making rental payments during the period of time that the purpose of the contract was frustrated” and that the obligation to do so “revives once performance subsequently becomes possible.”

In Commonwealth Edison v. Allied-Gen. Nuclear Servs., 731 F. Supp. 850 (N.D. Ill. 1990), the parties entered into a contract reprocessing and delivering spent fuel created by Commonwealth Edison. The re-processer had to secure an operating license for this activity. Soon after the contract as signed, there was an indefinite moratorium on spent-fuel reprocessing which was lifted years later. By that time the re- processing industry was commercially unviable and essentially nonexistent. Pursuant Section 269, the court found that the re-processor was discharged from its contractual obligations, as performance had become “materially more burdensome.”

In Glen Hollow P’Ship v. Wal-Mart Stores, 139 F.3d 901 (7th Cir. 1998), Wal-Mart entered into a construction contract for the contractor to build a shopping center to be leased by Wal-Mart. A lawsuit was filed against the city’s commercial zoning of the property. Six months after the end of that lawsuit, construction had not yet started and Wal- Mart terminated the lease. The contractor sued Wal-Mart for breach of contract and won in the trial court. On appeal, the Seventh Circuit applied Section 269 because of the temporary impossibility in construction due to the rezoning dispute. It ruled that “[o]nce the governmental regulations no longer delayed performance, [contractor] would have a reasonable extension of time to perform.” But the court ruled that the contractor’s delay in starting construction for more than six months after the end of the rezoning litigation was not caused by the rezoning dispute, but by the contractor’s own inability to finance the project.

See also Culp v. Tri-City Tractor, Inc., 736 P.2d 1348 (Idaho Ct. App. 1987) (“Temporary impossibility [under Section 269] merely suspends the duty of performance until the impossibility ceases.”).

See Nash v. Bd. of Educ., Union Free Sch. Dist. No. 13, 345 N.E.2d 575 (N.Y. 1976) (a required notice was meaningless during the temporary period of impracticality, so defendant was excused from giving notice, but was then “obliged to give notice at the earliest possible opportunity” once the circumstance giving rise to the impracticality had ended).

Conclusion

The pandemic has led to many contract and commercial lease court cases, and the doctrines of temporary or partial impracticability and frustration of purpose may provide pathways to settlement in those disputes.

Frank Burke, Esq.
Mediator | Arbitrator
ADR Services, Inc. – Your Partner in Resolution

fburke@adrservices.com
Scheduling: 415-772-0900 | Cell: 650-804-8300
http://www.adrservices.com/neutrals/burke-frank/

Available to handle your matters remotely via Zoom Conferencing.

Recognized in Best Lawyers in America for Mediation, Arbitration and Commercial Litigation

Online | San Francisco | Oakland | Silicon Valley | Century City | Downtown Los Angeles | Orange County | San Diego

 

Please join us for a timely update program on “Residential Landlord Tenant Actions: The New Senate Bill 91, and Updates on Unlawful Detainers, Rent Relief and Rent Collection” on February 23, 2021 12-1:30 pm PST via Zoom, sponsored by the Santa Clara County Bar Association. You may register at this link: https://buff.ly/3dofhba
I am serving as the moderator of this program. An expert panel of lawyers and Judges will discuss the newly enacted California Senate Bill 91 which extends the eviction moratorium and rent relief restrictions provided in California Assembly Bill 3088 through July 1, 2021, adds some additional fixes and rent relief and adds provisions relating to small landlords. An important mandatory notice must be sent to tenants by February 28, 2021.
There are also additional filing requirements related to rent relief. The panel will also discuss the current status of the Santa Clara County Unlawful Detainer docket, including evictions, rent relief and rent collection, ex parte proceedings, and perspectives for landlord and tenant counsel.
Our speakers include Santa Clara Superior Court Judge Carol W. Overton, Santa Clara Commissioner Erik S. Johnson, Emily S. Hislop, Rent Stabilization Programs Manager of Project Sentinel, Santa Clara, and Steven J. Kahn of Hoge Fenton, San Jose & Pleasanton.
Please join us for this timely and important update seminar. Again, you may register at this link: https://buff.ly/3dofhba
Frank Burke, Esq.
Mediator | Arbitrator
ADR Services, Inc. – Your Partner in Resolution
Scheduling: 415-772-0900 | Cell: 650-804-8300
Available to handle your matters remotely via Zoom Conferencing.
Recognized in Best Lawyers in America for Mediation, Arbitration and Commercial Litigation
Online | San Francisco | Oakland | Silicon Valley | Century City | Downtown Los Angeles | Orange County | San Diego

The COVID-19 pandemic has had a negative effect on contracts and commercial  leases, preventing or slowing performance and upending the expectations of contracting parties. In many cases both parties have suffered losses. There are many pathways to settlement in these matters which can be resolved by applying principles in the doctrines of force majeure, impossibility, impracticability, commercial frustration of purpose, and material adverse change or effect clauses. A PDF copy of this article can be found at this link and attached: https://buff.ly/2Uq1bvt

 

Frank Burke, Esq.

Mediator | Arbitrator
ADR Services, Inc. – Your Partner in Resolution

fburke@adrservices.com
Scheduling: 415-772-0900 | Cell: 650-804-8300
http://www.adrservices.com/neutrals/burke-frank/
 
Available to handle your matters remotely via Zoom Conferencing.
 
Recognized in Best Lawyers in America for Mediation, Arbitration and Commercial Litigation

Online | San Francisco | Oakland | Silicon Valley | Century City | Downtown Los Angeles | Orange County | San Diego

This profile of me appeared recently in the Daily Journal, the California statewide legal newspaper. It was an honor to read the kind words from the extraordinary counsel with whom I have worked in past mediations. A PDF copy of the article can be found at this link and attached: https://buff.ly/2zHZxP0 .

Frank Burke, Esq.

Mediator | Arbitrator

ADR Services, Inc. – Your Partner in Resolution

fburke@adrservices.com

Scheduling: 415-772-0900 | Cell: 650-804-8300

Case Manager: katy@adrservices.com

http://www.adrservices.com/neutrals/burke-frank/

Available to handle your matters remotely via Zoom Conferencing.

SEVEN OFFICES STATEWIDE:

San Francisco | Oakland | Silicon Valley | Century City | Downtown Los Angeles | Orange County | San Diego

Please join us for the upcoming Santa Clara County Bar Association Zoom seminar on COVID-19 and Its Impact on Enforcement or Excuse of Contract Performance in Commercial Contracts, Construction Projects, Real Estate Development Projects and Financial Transactions on June 30, 2020 from 12-1 pm. As Co-Chair of the SCCBA Real Property and Business Law Section, I will moderate the program which will feature two top Silicon Valley business and real estate trial lawyers: Richard O McDonald of Hopkins & Carley and Dawn C. Sweatt of Berliner Cohen LLP

The program will focus on practical application of force majeure, impossibility, impracticability, frustration of purpose, and material adverse change clauses to commercial contracts in today’s landscape, leading to negotiated resolutions or litigation.

The program should be of interest to litigation as well as transactional attorneys, and the Zoom format allows for very reasonable pricing for this program which provides 1 hour of CLE credit. We hope that you can attend and also pass this along to others so they might take advantage of this Zoom program.

Here is a link to the seminar registration form:

https://buff.ly/37hjsAK

Frank Burke, Esq.
Mediator | Arbitrator
ADR Services, Inc. – Your Partner in Resolution

fburke@adrservices.com
Scheduling: 415-772-0900 | Cell: 650-804-8300
http://www.adrservices.com/neutrals/burke-frank/

Available to handle your matters remotely via Zoom Conferencing.

SEVEN OFFICES STATEWIDE:

San Francisco | Oakland | Silicon Valley | Century City | Downtown Los Angeles | Orange County | San Diego

 

 

Please join us for the upcoming Santa Clara County Bar Association Zoom seminar on Tips and Tactics in Deposing and Defending Business Representatives on May 19, 2020 from 12-2 pm. As Co-Chair of the SCCBA Real Property and Business Law Section, I will moderate the program which will feature three top Silicon Valley trial lawyers: Sarju Naran of Hoge Fenton, Vince Parrett of Bergeson, and Elizabeth Pipkin of McManis Faulkner. The panel has considerable experience involving depositions of H.R., technology and financial witnesses.

The program should be of interest to younger as well as more experienced attorneys, and the Zoom format allows for very reasonable pricing for this program which provides 2 hours of CLE credit.  We hope that you can attend and also pass this along to others so they might take advantage of this Zoom program.

The program will focus on framing and objecting to the subject matters in the deposition notice, selecting and prepping the representatives, strategies during the deposition, and handling problems that arise. The program will conclude with demonstrations of a witness prep session and a witness examination.

Here is a link to the seminar registration form:

https://buff.ly/2LdievX

Frank Burke, Esq.
Mediator | Arbitrator
ADR Services, Inc. – Your Partner in Resolution

fburke@adrservices.com
Scheduling: 415-772-0900 | Cell: 650-804-8300
http://www.adrservices.com/neutrals/burke-frank/

 Available to handle your matters remotely via Zoom Conferencing.

*96 North 3rd Street, Suite 350 | San Jose, California | 95112
*100 First Street, 27th Floor | San Francisco, California | 94105
*One Kaiser Plaza, Suite 480 | Oakland, California | 94612

 

By using Zoom online videoconferencing for mediation or arbitration sessions, ADR providers can allay any concerns you may have related to traveling or meeting in person , in light of the coronavirus (COVID-19) outbreak.

We hope this article finds you well, and in good health. At ADR Services, Inc., it is our goal to meet the needs of our clients and truly serve as a Partner in Resolution. With this in mind, if you or your clients have concerns regarding traveling or attending an in-person mediation or arbitration during this troubling time, ADR Services is equipped to offer video conferencing via Zoom Meetings, a state of the art cloud-based video conferencing software, that its clients are welcome to use if personal appearance is not possible. This software can accommodate joint sessions or completely private virtual meeting rooms for separate caucuses.

ADR Services, Inc. is happy to provide and help coordinate this amenity, at no additional cost to its clients. It asks that all participants agree to appearance via videoconferencing in advance of the mediation or arbitration session.

When sheltering in place orders end, ADR Services neutrals remain available to mediate or arbitrate with all parties present, one party present and the other through video conferencing, or with everyone present through video conferencing.

Each participant in a Zoom Meeting should have a late model laptop, desktop or tablet computer or iPhone or Android phone with a built-in web camera and microphone. For an optimum experience, each participant should have a computer with a quad core processor and extra RAM, a strong, secure Internet connection, and should participate in a private room to ensure confidentiality.

When the participants join the meeting, they will be placed in a virtual waiting room and the host will add all participants to the meeting at the same time. Later, if separate caucuses are desired, the host will separate each client and counsel or groups of clients and counsel, into separate virtual caucus breakout rooms for private conversations. All participants can later be rejoined into a joint session if that is desirable. The system allows for the sharing of documents in electronic form on the computer screens for review, and also has markup capabilities. Alternatively, a tablet computer can be attached as a peripheral device and used as an onscreen whiteboard.

Please feel free to contact my case managers, Katy Jones and Tiffany Bugg, to assist you in making arrangements for a mediation or arbitration session. Katy and Tiffany can be reached by email at katy@adrservices.com or tiffany@adrservices.com.

If we can do anything further to assure your well-being and safety, please let us know. We look forward to hearing from you.

Frank Burke

Mediator | Arbitrator

ADR Services, Inc. – Your Partner in Resolution

fburke@adrservices.com

SEVEN OFFICES STATEWIDE:

San Francisco | Oakland | Silicon Valley | Century City | Downtown Los Angeles | Orange County | San Diego

Please join us for the national webcast of “Effective Mediation and Settlement of Commercial Real Estate Disputes” on September 19, 2019 from 12-2 p.m. PST,  co-sponsored by the California Lawyers Association and the Santa Clara County Bar Association. You may register at the following link: https://buff.ly/30uy3o9 It will also be presented live at the SCCBA Seminar & Conference Center in San Jose, CA, and will be available On Demand thereafter.

I am serving as the Program Chair and Moderator of this interactive program presentation. A highly experienced panel of experienced commercial real estate lawyers and mediators will focus on best practices in settling commercial real estate disputes in mediation through business solutions, cash payments or equitable remedies. We will focus on mediation and settlement of a variety of commercial real estate disputes including co-owner disputes; partition; partnership, LLC and LLP dissolutions; commercial lease disputes; and claims of misrepresentation and nondisclosure in purchase and sale agreements, real estate finance disputes, and other dispositions of commercial real estate.

The panel consists of John Cavin of Hoge Fenton, Nancy J. Johnson of Berliner Cohen LLP, Perry Woodward of Hopkins & Carley and Julia M. Wei of Diemer & Wei.

The topics will include:

  • When is the right time to mediate and what are the benefits
  • Assessment of liability and damages scenarios to reach a monetary solution
  • Exploring potential business solutions to the dispute
  • Who should attend the mediation
  • Effective mediation memoranda, pre-hearing conferences and oral presentations at the mediation
  • Opening offers and settlement moves, avoiding or breaking impasse and closing the deal
  • Documenting the settlement

Please join us live or on the webcast or on demand. You may register at the following link: https://buff.ly/30uy3o9

Frank Burke, ADR Services, Inc.