Without question, everyone's life has been affected by the Covid-19 coronavirus pandemic. So much has changed over the last 30 days, and since little is still known about the coronavirus that has sickened so many, including how it spreads, and how it can be mitigated, governmental guidance has been a swift-moving target.
Individuals and business owners have been forced to navigate social norms and laws that seem to change every day. My legal practice is a small business, so believe me, I understand. The coronavirus has altered the way we conduct our business at Daily & Woods and has expanded the scope of our practice. This post will touch on some of the changes we have seen, and while there have certainly been challenges, we have also seen how the new laws have provided our clients with some good opportunities in a variety of substantive legal areas.
Legal Services Are Essential Services
Arkansas is one of a few states without a formal “stay at home” or “shelter in place” order. Our government is taking a targeted approach to curbing the impact of the coronavirus, enforcing social distancing, encouraging mask wearing, and allowing many businesses to continue to operate.
Even if a formal stay-at-home order was issued in Arkansas, the order would exempt several businesses deemed to provide “essential services.” In nearly every state with such an order, professional businesses, including law offices are deemed essential, and permitted to stay open for business.
At Daily & Woods, since early March we’ve changed how we operate our office. We have closed our doors to walk-in traffic, and have only allowed select meetings to occur in-person. We take substantial precautions consistent with the guidance we receive from the CDC. We wear masks if we need to interact in person, but we otherwise keep our distance when we are in the office. On most days, we work from home. I hold all of my meetings via video-teleconference, using Zoom, FaceTime, or Teams. video-teleconference technology allows us to continue to provide essential legal services to clients, while practicing social distancing.
In an example of how social distancing directives can be abused, in the realm of family law, some Arkansas judges have become aware that parents might use Covid-19 as an excuse to withhold their children or prevent the non-custodial parent from exercising visitation. None of the orders or directives from the Arkansas Supreme Court or Gov., Hutchinson, in any way, interfere or alter existing child visitation orders. Courts have made it clear in recent days that absent an emergency, they intend enforce those orders, as written, even during the pandemic.
Executive Order 20-12 was signed by Governor Hutchinson on March 30, 2020. It allows Arkansas notaries and witnesses to view and acknowledge the execution of wills, trusts, powers of attorney, health care directives, deeds, and other estate planning and real estate title instruments “in person”, using video-teleconference technology such as Zoom, FaceTime, and Teams. Our office has seized the opportunity to utilize this technology in order to provide contact-free estate planning for clients. Recently, I was able to finalize an estate plan for two young professionals that was designed to protect themselves, and their children. Using video-teleconference technology, we were able to complete the estate plan, even though the clients were located 80 miles from the office.
Executive Order 20-12 can be utilized to allow contract-free estate planning for those clients that are in nursing and assisted living facilities, which is incredibly important during this time because those facilities have restricted in-person visitation. Hospitalized patients can also utilize this service. Video teleconferencing not only allows those patients to complete an estate plan, health care directive, and powers of attorney, but it also keeps witnesses and notaries safe because they never need to enter the facility.
Real Estate Law
In Arkansas, there is no state-wide moratorium against foreclosure and eviction during the coronavirus pandemic even though some local courts have announced they will not hold eviction proceedings. As a practical matter, foreclosure and eviction cases will probably not be heard anytime soon. While all courts are technically still open, judges are not holding too many in-person hearings, and evictions and foreclosures are not the type of legal actions that would fall under one of the Supreme Court’s emergency proceedings.
So, as a residential tenant, should you still pay your rent? The answer, is "yes." Your lease requires that you pay rent, despite the existence of an uncertain global pandemic. If you don’t pay rent, you’ll eventually be evicted. Even if eviction doesn’t occur this month, it will happen soon after. A coronavirus will not change the fact that you will continue to owe the rent, and when eviction proceedings eventually commence, you’ll may also be subject to paying the landlord’s attorney’s fees.
If you are a landlord, and your tenant won’t pay rent, what can you do? Be patient. You can still initiate the eviction process, even if the court won’t set the matter for a hearing. The better approach may be to work out a delayed rental payment arrangement with you tenants.
Business Planning and Employment Law
At the time of the writing of this post, there are three major stimulus laws that are designed to help all categories of Americans, from individuals, to businesses, as well as local government: the Families First Coronavirus Response Act; the Coronavirus Preparedness and Response Supplemental Appropriations Act; and the Coronavirus Aid, Relief and Economic Security (CARES) Act.
Each law is voluminous and deserves its own series of posts. Suffice to say for now that each law has its own unique challenges, but also includes several unprecedented opportunities to receive unemployment payments, loans, and grants, as well. If you have any questions about eligibility under any of the programs that are offered, the attorneys at our firm are glad to speak with you and guide you through the process.
Contracts and Commercial Law
Recently, a client asked if it was possible to “get out” of certain obligations under a purchase and sale agreement due to the Covid-19 pandemic. The answer will depend on the contract, itself and the circumstances in which the pandemic affects the client. Each situation is different, and you would be well served to consult with an attorney about your rights and obligations.
Generally speaking, it is possible that contractual obligations can be avoided under the legal defense of “impossibility” or “frustration of purpose.” If the global pandemic brought about a material change of circumstances that rendered performance of the contract literally impossible, then a court may allow one party to avoid his or her obligation.
Also relevant is the doctrine of “force majeure”. Whether force majeure will apply will depend on the terms of the contract itself. Force majeure clauses are sometimes found in real estate documents, including oil and gas leases, as well as sales, purchase, and product fulfillment agreements. Again, it is suggested that contracting parties provide the agreement to their attorney for review so that the attorney can determine whether any of these defenses might be applicable during this time of emergency.
Wrapping Up…for Now
As I said at the outset, the rules and guidance we receive changes day by day. If the Covid-19 pandemic has had an effect on your Arkansas business, or your way of life, and you need legal guidance, our attorneys are glad to “meet” with you via video teleconference and discuss the matter with you.