In legal terms, the Force Majeure clause is a provision commonly included in commercial contracts to address unforeseen events or circumstances that are beyond the control of the parties involved. The phrase “force majeure” itself translates to “greater force” or “superior force” in French. The purpose of this clause is to mitigate the liability of the parties when they are unable to fulfill their contractual obligations due to extraordinary events or circumstances.

The Force Majeure clause serves as a safeguard for situations where the performance of a contract becomes impracticable or impossible due to events that were unforeseeable and beyond the control of the parties. These events can include natural disasters like earthquakes, hurricanes, floods, or fires, as well as acts of terrorism, wars, government actions, labor strikes, or other major disruptions.

By including a Force Majeure clause in a contract, the parties can agree in advance on the consequences and rights of each party if such an event occurs. Typically, the clause will define the specific events or circumstances that qualify as force majeure, providing a non-exhaustive list of examples. These examples often encompass natural disasters, acts of God, riots, embargoes, or any other events that are considered extraordinary and beyond the control of the parties.

When a force majeure event occurs, the clause usually relieves the affected party from liability for non-performance or delayed performance of its contractual obligations. It may suspend the performance obligations temporarily until the force majeure event ceases, or in some cases, it may even allow for the termination of the contract altogether.

It is essential to note that the application and interpretation of a Force Majeure clause may vary depending on the specific wording used in the contract and the governing law of the jurisdiction. Therefore, it is crucial to carefully review the language of the clause and seek legal advice if there is uncertainty or disagreement about its applicability to a particular situation.

It is also worth mentioning that force majeure clauses do not automatically excuse a party from performing its obligations. The party seeking to rely on the clause must demonstrate that the event or circumstance in question falls within the scope of the clause and that it has made reasonable efforts to mitigate the impact of the event. Furthermore, some contracts may require the affected party to provide notice of the force majeure event within a specified timeframe.

In summary, the Force Majeure clause is an important provision in commercial contracts that helps protect parties from unforeseeable events or circumstances beyond their control. It allows for the suspension or termination of contractual obligations when such events occur, preventing them from being considered as breaches of contract.

Example 1 

“Force Majeure: Neither party shall be liable for any failure or delay in the performance of any obligations under this Agreement, except for the obligation to make payments, if such failure or delay is caused by a Force Majeure event. For purposes of this Agreement, a Force Majeure event shall mean any event or circumstance beyond the reasonable control of the parties, including but not limited to:

1. Acts of God, such as earthquakes, hurricanes, floods, fires, or other natural disasters.
2. Acts of terrorism, riots, civil unrest, or public disturbances.
3. Wars, hostilities, invasions, or other armed conflicts.
4. Government actions, including changes in laws or regulations, embargoes, or trade restrictions.
5. Labor strikes, lockouts, or other industrial disputes.
6. Epidemics, pandemics, or outbreaks of infectious diseases.
7. Power outages, telecommunications failures, or transportation disruptions.
8. Any other events or circumstances that are unforeseeable and beyond the control of the parties.

In the event that a party is unable to perform its obligations under this Agreement due to a Force Majeure event, such party shall promptly provide written notice to the other party specifying the nature of the Force Majeure event, the expected duration of the event, and the anticipated impact on the party’s ability to perform its obligations.

During the period of the Force Majeure event, the affected party’s obligations under this Agreement shall be suspended to the extent directly affected by the Force Majeure event. The parties shall use reasonable efforts to mitigate the impact of the Force Majeure event and resume the performance of their obligations as soon as reasonably practicable after the event ceases.

If a Force Majeure event continues for a period of [insert number of days or specify a reasonable timeframe], either party may terminate this Agreement by providing written notice to the other party. In such event, neither party shall be liable to the other for any damages, costs, or expenses arising out of the termination due to the Force Majeure event.

The party seeking to rely on the Force Majeure clause shall bear the burden of proving that the event or circumstance qualifies as a Force Majeure event and that it has taken reasonable steps to mitigate the impact of the event.”

Example 2 

“Force Majeure: In the event that either party is unable to perform its obligations under this Agreement due to a Force Majeure event, the affected party shall be excused from such performance to the extent and for the duration of the Force Majeure event. The term ‘Force Majeure event’ shall include, but is not limited to, the following:

1. Acts of God, including earthquakes, hurricanes, or floods.
2. Fires, explosions, or other accidents.
3. Acts of terrorism, acts of war, or civil unrest.
4. Strikes, labor disputes, or lockouts.
5. Epidemics, pandemics, or government-imposed quarantines.
6. Changes in applicable laws or regulations.
7. Power failures, telecommunication failures, or internet outages.
8. Any other event or circumstance beyond the reasonable control of the parties that makes performance commercially impracticable or impossible.

The party affected by a Force Majeure event shall provide written notice to the other party as soon as reasonably practicable, describing the Force Majeure event and the expected impact on its ability to perform its obligations.

During the Force Majeure event, the parties shall make reasonable efforts to minimize the impact on their respective obligations. Once the Force Majeure event ceases or its impact diminishes, the parties shall resume the performance of their obligations.

If a Force Majeure event continues for a period of [insert number of days or specify a reasonable timeframe], either party may terminate this Agreement by giving written notice to the other party. In such event, neither party shall be liable to the other for any damages, penalties, or losses resulting from the termination due to the Force Majeure event.”

Example 3

“Neither party shall be liable for any failure or delay in the performance of its obligations under this Agreement if such failure or delay is due to a force majeure event. Force majeure events shall include, but not be limited to, acts of God, fires, floods, earthquakes, wars, acts of terrorism, strikes, labor disputes, governmental actions, and any other events beyond the reasonable control of the parties.”

Example 4

“In the event of a force majeure event, the affected party shall promptly notify the other party in writing of the occurrence of such event and the expected duration of its impact on the performance of this Agreement. The obligations of the affected party shall be suspended during the continuance of the force majeure event, and the affected party shall make reasonable efforts to mitigate the effects of such event.”

• Clearly define force majeure events: Start by providing a clear and specific definition of what constitutes a force majeure event. This definition should be broad enough to cover a range of unforeseeable events beyond the control of the parties, such as natural disasters, acts of God, wars, governmental actions, or epidemics. Including a non-exhaustive list of examples can be helpful, but avoid being overly restrictive or too vague.

• Specify notice requirements: Determine the timeframe and method for providing notice in the event of a force majeure event. The clause should outline how and when the affected party must notify the other party about the occurrence of the force majeure event, its impact on the contract, and the expected duration of the event. This allows for prompt communication and enables the parties to take appropriate actions.

• Address the impact on performance: Clearly state how the occurrence of a force majeure event will impact the performance of the contract. Specify whether the obligations will be suspended entirely during the force majeure event or if there will be a temporary delay. Consider including language that allows for the termination of the contract if the force majeure event persists for an extended period or becomes permanent.

• Mitigation obligations: Clarify the responsibilities of the affected party to mitigate the impact of the force majeure event. While the affected party may be excused from performance, they should still be expected to take reasonable steps to minimize the consequences and resume performance as soon as practicable once the force majeure event subsides.

• Governing law and dispute resolution: Determine the applicable governing law for interpreting the Force Majeure clause and specify the procedures for resolving any disputes arising from its application. This can help ensure consistency and provide a framework for resolving disagreements related to force majeure events.

• Consult legal counsel: Given the potential complexities and variations in laws and contractual requirements, it is highly recommended to seek advice from legal professionals when drafting or modifying a Force Majeure clause. They can provide specific guidance based on your jurisdiction and the nature of your contract.