Force Majeure Clauses

A force majeure clause is a clause that relieves the parties to a contract of their contractual obligations when certain circumstances arise that are out of their control, and these circumstances make performance under the contract inadvisable or impracticable.  It is imperative to have such a clause in your contract so that the parties to the contract do not have to rely upon the common law to protect them if such a situation were to arise.

The events that would trigger a force majeure clause are sometimes referred to as “Act of God” events.  The current COVID-19 pandemic can certainly be seen to some people as an “Act of God.” However, the pandemic may not allow for a force majeure defense, unless the clause expressly provides that defense is available during “pandemics.” In North Carolina, we face a number of potential “Acts of God” – hurricanes, tornadoes, floods, so inclusion of a force majeure clause is never a bad idea.

If you have any questions regarding the contracts of your business and how you can best alter them to ensure that your business is protected if performance is impracticable during this pandemic, please contact the lawyers at Hannah Sheridan & Cochran, LLP to help ensure the safety of your business during COVID-19.