Sample Management Contract With Force Majeure In Houston
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Termination — In cases where the force majeure event is severe and long-lasting, the contract may allow for its termination, meaning the parties are released from their obligations entirely because the event has made it impossible or impractical to continue with the contract.
Force Majeure Clauses “Often likened to impossibility, it historically embodied the notion that parties could be relieved of performing their contractual duties when performance was prevented by causes beyond their control, such as an act of God.”
The Act of God defense is a rebuttable defense available in Texas. The defense is limited by whether or not humans could have intervened. If a natural event caused the injury, the defense will work. However, if nature and the negligence of a person or entity caused the injury, the defense will not survive.
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.
Neither Party shall be liable for failure of or delay in performing obligations set forth in this Agreement, and neither shall be deemed in breach of its obligations, if such failure or delay is due to natural disasters or any causes beyond the 5 reasonable control of either Party.
There are generally three essential elements to force majeure: • tt can occur with or without human intervention • it cannot have reasonably been foreseen by the parties • It was completely beyond the parties' control and they could not have prevented its consequences.
Force majeure events are usually defined as certain acts, events or circumstances beyond the control of the parties, for example, natural disasters or the outbreak of hostilities.
What Are Examples of Force Majeure? Events that could trigger a force majeure clause include war, terrorist attacks, a pandemic, or natural disasters that fall under the “act of God” category, such as a flood, earthquake, or hurricane.
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.
