Contract Clause Guide

Force Majeure: When Extraordinary Events Prevent Performance

A force majeure clause excuses parties from performing their obligations when extraordinary events beyond their control occur, such as natural disasters, wars, or pandemics. These clauses became critical during COVID-19.

Example Clause

Neither party shall be liable for any failure or delay in performing its obligations where such failure or delay results from Force Majeure Events including but not limited to: acts of God, natural disasters, war, terrorism, riots, pandemics, government actions, or other events beyond the reasonable control of the affected party.

What This Means

If something extraordinary happens that's out of your control (like a pandemic or natural disaster), you won't be held responsible for not fulfilling your obligations. This protects both sides from liability when the impossible happens.

Common Risks to Watch For

1

Narrow list of covered events that may not include pandemics

2

No obligation to mitigate or find alternatives

3

Unclear duration - how long can force majeure last?

4

One-sided clause that only protects one party

5

No right to terminate if force majeure continues too long

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