This clause requires one or both parties to maintain a written plan for keeping the business running if something goes wrong—like a cyber attack, natural disaster, or key staff leaving. It matters legally because if you fail to have this plan and something breaks down, the other party can claim you breached the contract and sue for damages (lost profits, for example). In the UK and US, courts increasingly expect businesses to have reasonable contingency plans. The clause typically specifies what must be in the plan: backup systems, alternative suppliers, communication procedures, and recovery timelines. Without this clause, you might have no legal obligation to prepare for emergencies at all.
Push back on overly detailed requirements—ask for a "reasonable" plan rather than one that lists every possible scenario. Get clarity on what happens if an emergency occurs despite your best efforts (you want protection from liability for genuine disasters). Consider negotiating a shared responsibility where both parties contribute to the plan, rather than bearing the entire burden yourself. ---
Frequently Asked Questions
What does this clause mean in simple terms?
This clause requires one or both parties to maintain a written plan for keeping the business running if something goes wrong—like a cyber attack, natural disaster, or key staff leaving.
Why should I care about this clause?
It matters legally because if you fail to have this plan and something breaks down, the other party can claim you breached the contract and sue for damages (lost profits, for example).
What are my options?
In the UK and US, courts increasingly expect businesses to have reasonable contingency plans.
How does this affect small businesses?
The clause typically specifies what must be in the plan: backup systems, alternative suppliers, communication procedures, and recovery timelines.