Even Santa has to carefully manage risk and ensure that his contracts deliver the promised terms on time and on budget! Here is a holiday tale emphasizing the importance of having a clear and well-structured risk allocation clause, particularly for ‘mission critical’ contracts.

Upon return from their annual Mexican vacation in early March, Santa and Mrs. Claus began planning for the next Christmas Season. One issue they knew needed immediate attention was reindeer succession planning: Rudolph was only three years away from his full pension, and Donner and Blitzer were both planning to retire after the upcoming Christmas flight.

After doing some market sounding to determine whether there were any new reindeer providers in the market, Santa turned to his regular reindeer supplier – Arbutus Sled Accessories Ltd. (“Arbutus”). In recent years the demand for reindeer has been in decline, and there appear to be no new companies entering the market. After some initial discussion, Santa agreed to buy 57 reindeer from Arbutus.  Read what happened next.

Should Santa Sue?

Thanks to our member NECI and The Legal Edge for sharing this seasonal tale of procurement risk management with us!