Problem
Your contract’s force majeure clause says hurricanes, earthquakes, wars, and other disasters excuse the vendor’s service obligations. But the contract also has disaster recovery and business continuity terms (which I’ll call “DR/BC” terms). The whole point of those terms is that the vendor’s systems will survive these “acts of God,” or at least recover quickly. Does your force majeure clause cancel your DR/BC terms?
It’s hard to say what happens to DR/BC terms in the face of a force majeure clause, but at a minimum, the vendor’s obligations get fuzzy. If you’re the customer, accepting those fuzzy terms leaves your vendor a lot of wiggle-room, right when you need decisive service with no arguments: during a disaster. You’re also taking an unnecessary risk.
Solution
The simplest solution for the customer is a sentence added the DR/BC terms: “Section __ (Force Majeure) does not apply Vendor’s obligations set forth in this Section __ (Disaster Recovery).”
If you’re the vendor, that works fine if your DR/BC clause requires nothing but reasonable efforts to recover quickly. But if you have more specific obligations, you need more tailored language. If you’re required to have backup systems in place, for instance, and an act of God keeps that from happening, you don’t want to give up all the value of the force majeure clause. So you could draft something like the following: “A Force Majeure Event (as defined in Section __) affecting the data center does not excuse Vendor obligations set forth in this Section __ (Business Continuity) with respect to any backup data center.”
In other words, tailor your force majeure exception to fit your DR/BC obligations. Just think it through: what’s reasonable for the vendor to achieve, and what should be excused by a disaster?
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David Tollen is the founder of Tech Contracts Academy and our primary trainer. He is an attorney and also the founder of Sycamore Legal, P.C., a boutique IT, IP, and privacy law firm in San Francisco. His practice focuses on those same topics, and he also serves as an expert witness in litigation about software licenses, cloud computing agreements, and other IT contracts.
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