Are there any exceptions to the obligation to return deposits?
The CMA sees only limited circumstances in which a full refund would not be given. The CMA accepts that where public health measures prevent a business from providing a service or the consumer from receiving it, the business may be able to deduct a contribution to the costs it has already incurred in relation to the specific contract in question.
This view reflects a relatively complex area of law under which parties are released from obligations under a contract if performance of that contract becomes impossible or illegal. This is called “frustration” of the contract. Under a law passed during World War II, a party to a contract that is frustrated who has incurred expenses is permitted, if the court thinks fit, to retain an amount up to the value of those expenses out of any money they have been paid by the other party.
The CMA’s view, however, is that this will not happen often, and that deductions from deposits will be limited.
Related FAQs
The Government has produced and published three new Procurement Policy Notes as a direct result of the ever changing Covid-19 environment.
PPN 01/20: Responding to COVID-19
The purpose of PPN 01/20 is to ensure that contracting authorities are able to procure goods, services and works with extreme urgency, to allow them to respond to the pandemic efficiently.
This PPN provides guidance for the following circumstances:
- Direct award due to extreme urgency (regulations 32(2)(c)) (click here to read our article regarding regulation 32)
- Direct award due to an absence of competition or protection of exclusive rights
- Call off from an existing framework agreement or dynamic purchasing system
- Call for competition using a standard procedure with accelerated timescales
- Extending or modifying a contract during its term
PPN 02/20: Supplier relief due to COVID-19
PPN 02/20 focuses predominantly on the supplier to assist in keeping supply chains open and ensuring that suppliers are kept financially sound during these unpredictable times.
This PPN provides guidance for the following circumstances:
- Urgent reviews of contract portfolios and to update suppliers if they believe they are at risk
- Put in place appropriate payment measure to support supplier cash flow
- Where contract payments are based on ‘payment by results’ make payments based on previous invoices
- Ask suppliers to act on a ‘open book’ basis and make cost data available to the contracting authority during this period
- Ensure invoices submitted by suppliers are paid immediately on receipt
PPN 03/20: Use of Procurement Cards
The third guidance note PPN 03/20 relates to the use of procurement cards to increase efficiency and accelerate payment to suppliers.
This PPN provides the following advice and urges organisations to arrange with their procurement card provider to:
- Increase a single transaction limit to £20,000 for key card holders
- Raise monthly limits on spending with procurement cards to £100,000 for key card holders
- Spend on procurement cards each month in excess of £100,000 should be permissible to meet business needs
Although the above advice has been provided, should these limits not be necessary, organisations should seek an appropriate transaction limit or monthly limit.
The PPN also advises that by 30 April 2020, in scope organisations should:
- Ensure that a number of appropriate staff have the authority to use these cards
- Open all relevant categories of spend to enable these cards to be used more widely
A new Permitted Development Right has been introduced by The Town and Country Planning (Permitted Development and Miscellaneous Amendments) (England) (Coronovirus) Regulations 2020 providing for the construction of new dwellinghouses on detached blocks of flats.
The new Right comes into force on 1 August 2020 and from this date development consisting of works for the construction of up to two additional storeys of new dwellinghouses immediately above the existing topmost residential storey which is a purpose-built, detached block of flats is permitted development. The Right additionally covers specified associated works, the construction of fire escapes and ancillary structures, bin stores for example.
The Right is subject to detailed criteria being met and to a prior approval process to the Local Planning Authority who can consider the acceptability of the proposed development in a range of respects. A link to the Regulations is here.
The Regulations additionally include a number of further amendments including additional rights for the holding of markets and for additional temporary uses of land for a time limited period. They additionally include amendments to existing permitted development rights for the change of use of buildings to dwellinghouses through a requirement that there be adequate natural light in all habitable rooms.
The fundamentals of risk assessment remain the same as for any other foreseeable risk.
Focus on risk controls which reflect Government guidance; social distancing (2 metres) and avoiding contact with occupiers if possible, high-quality PPE – disposable overalls, gloves and fluid repellent surgical face masks, ready access to antibacterial wipes for surfaces, tools and equipment and plentiful hand sanitizer.
If your visa has expired or will do before you are able to safely leave the UK, you can apply for “Exceptional Indemnity” by contacting the Coronavirus Immigration Team. You will need to provide evidence as to why you cannot leave, which could include a positive Covid-19 test or evidence of being unable to make travel arrangements to leave the UK in time.
You should note that “Exceptional Indemnity” does not extend your leave, but temporarily protects you from adverse action being made against you as result of overstaying your visa.
- A taxable grant worth 80% of the average monthly profit over the last three years (one or two years will be reviewed for those who do not have three years of tax returns)
- The grant will be capped at £2,500 per month
- The scheme was initially available for three months and has been extended as necessary
- Individuals claiming a grant can continue to do business (unlike employees who must not work when furloughed)