Some courts won’t enforce a force majeure clause without specifics. They want to see “hurricane” specifically listed as force majeure if you claim a hurricane excuses performance. So heed the coronavirus’ warning and check your standard contracts (and any you’re currently negotiating). Do they list “epidemics”? If not, add it. And while you’re at it, add, “acts of governments, such shelter-in-place or similar orders.”
You might think a catchall like “acts of God” includes epidemics. And you might rely on the universal catchall: “other causes beyond the performing party’s reasonable control.” Those phrases might do the trick, but they very well might not. So why risk it? Our new microscopic enemy has reminded us to be specific.
Of course, most authorities call coronavirus or COVID-19 a “pandemic.” You’ll do no harm by adding that term, but it just refers to a worldwide epidemic, so the latter term should cover you. And you do want to include “epidemic” specifically, since the next illness to shut you down might be local or regional, and then “pandemic” wouldn’t cover you.
We’ve just updated the force majeure clause here at TechContracts.com. Here’s the text, with the key new concepts in red.
No delay, failure, or default, other than a failure to pay fees when due, will constitute a breach of this Agreement to the extent caused by hurricanes, earthquakes, epidemics, other acts of God or of nature, strikes or other labor disputes, riots or other acts of civil disorder, acts of war, terrorism, acts of governments such as expropriation, condemnation, embargo, changes in laws, and shelter-in-place or similar orders, or other causes beyond the performing party’s reasonable control.
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