Contract Law Force Majeure In Orange
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A restricted list limits the definition of force majeure events to only those specifically listed. An unrestricted list keeps the definition of a force majeure event open, to cover unexpected events outside the impacted party's control.
One of the key aspects of negotiating force majeure clauses is to define the terms and conditions that will trigger and govern the application of the clause. You should be clear and specific about what constitutes a force majeure event, and avoid vague or broad terms that may create ambiguity or disputes.
Because the concept is foreign, lawyers who review or draft contracts governed by U.S. law should start with the assumptions that 1) principles of force majeure will not be implied in a contract that does not expressly provide for them, and 2) U.S. courts will interpret and apply force majeure provisions narrowly.
If a contract does not include a force majeure provision, a party may nonetheless be excused from performance under the concept of commercial impracticality.
One of the key aspects of negotiating force majeure clauses is to define the terms and conditions that will trigger and govern the application of the clause. You should be clear and specific about what constitutes a force majeure event, and avoid vague or broad terms that may create ambiguity or disputes.
In other words, force majeure clauses allow the contracting parties to allocate risks based on situations where performance would become different because of certain expected or unexpected events.
For events to constitute the use of force majeure, they must be unforeseeable, external to contract parties, and unavoidable. Force majeure means “greater force” and is related to an act of God, an event for which no party can be held accountable.
Either Party shall be excused from performance and shall not be in default in respect of any obligation hereunder to the extent that the failure to perform such obligation is due to a Natural Force Majeure Event.
Force majeure is the situation-based doctrine under which a supervening event may excuse liability for non-performance, provided the supervening event is unforeseeable, uncontrollable, and makes the performance of an obligation impossible – thus qualifying as a “force majeure event”.
