Coronavirus: can it be a Force Majeure event?
In the laws of some countries, a party is excused from performing a contract if prevented by circumstances beyond its control, such as events of terrorism, civil wars, floods, earthquakes and strikes. There is no such concept in English law.
Force majeure clauses in contracts can protect parties who are unable to perform their contractual obligations because of events outside its control. However, these clauses must be drafted carefully to ensure that the non-performing business is protected as, if too broadly defined, the clause may be unenforceable.
A force majeure clause will commonly define what would amount to a force majeure event, such as flooding, epidemics, pandemics or other natural disasters. It may require notice of the event and co-operation to mitigate or resolve the problem. It may suspend or end a party’s duties and may give one or all parties a right to terminate without incurring liability.
Fundamentally, it will ensure that events covered by the clause do not frustrate the contract. None of these outcomes are available under the general law, but a force majeure clause can create them.
If you are concerned about the protection offered under your contracts, please contact Sarah Burton on email@example.com or call Sarah on 01302 308662.