Real Estate Force Majeure Clause In Georgia
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876.) Act of God defined. - Act of God means any accident produced by physical causes which are irresistible; such as lightning, storms, perils of sea, earthquakes, inundations, sudden death, or illness. Act of God excludes all idea of human agency.
The Georgia definition focuses primarily on physical damage. Although it does refer to “sudden death, or illness,” it may be difficult to apply the statute to the pandemic, particularly because Georgia case law provides that an “Act of God” must not be human-caused.
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.
If a contract is silent on force majeure or if the event does not meet the definition of force majeure under the parties' contract, a party's performance may still be excused in certain circumstances under the doctrine of commercial impracticability.
For the avoidance of doubt, Force Majeure shall not include (a) financial distress nor the inability of either party to make a profit or avoid a financial loss, (b) changes in market prices or conditions, or (c) a party's financial inability to perform its obligations hereunder.
What is a Force Majeure Clause? A force majeure (pronounced “forss ma-zhoor”) clause is a provision in a contract that allows one or both parties to excuse (or sometimes delay) their performance obligations if circumstances beyond their control arise. These circumstances are typically called “force majeure events.”
1. : superior or insuperable force. 2. : an event (as war, labor strike, or extreme weather) or effect that cannot be reasonably anticipated or controlled : fortuitous event compare act of god, inevitable accident.
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.
In real estate, force majeure refers to a contractual clause that allows parties to suspend or terminate their obligations when certain events beyond their control occur, making performance inadvisable, commercially impracticable, illegal, or impossible.
