Managing hardship and impossibility

Managing Hardship and Impossibility

COVID 19 has put a spotlight on force majeure clauses, with organizations leaning into the clauses to mitigate the impacts of the pandemic. Has it been successful, how can organizations best manage hardship and impossibility going forward? This TASK topic will pick apart force majeure and examine what constitutes impossibility, how to properly construct a force majeure clause and alternatives to a force majeure clause.

What Constitutes Force Majeure and Impossibility

When is Force Majeure Really Force Majeure?

The rapid spread of the novel coronavirus, combined with the impact of various government responses, has caused significant disruption to business on a global scale, including commercial travel, supply chains, and other commercial operations and relationships. As a result, some companies have asserted (or threatened) that the outbreak constitutes a force majeure event or gives rise to other legal bases excusing performance.

Business Disruption and Commercial Contracts (Part 2): What is the Actual Cause of the Disruption?

Force majeure and related doctrines may allow a contracting party to suspend or terminate performance when certain unforeseeable events that are beyond the control of the parties occur, such as a global pandemic or government action or prohibition. However, the mere existence of a force majeure clause and qualifying event may not excuse non-performance if that event is not the actual cause of the business disruption.

Expecting the Unexpected: Responding to Force Majeure and COVID-19

The battle against COVID-19 has caused disruptions to industries across the US. Based on the trajectory of the virus' impact, it appears inevitable that COVID-19 will continue to affect businesses - both large and small - for the coming weeks and months. Many of these businesses are parties to contracts that will become increasingly difficult to perform. By now, prudent business owners have reviewed their contracts with particular attention on each contracts' force majeure clause.

Will Force Majeure be #1?

COVID-19 has had a massive impact on so many aspects of our lives – and contracts are no exception. There is extensive discussion over what terms will change, which provisions become more important, whether the tone and tenor of negotiations themselves will alter, perhaps becoming more collaborative. Scanning the legal press, it would be easy to conclude that Force Majeure may once again be a candidate for top spot – but is that really the case?

Constructing Force Majeure Clauses

Using the WorldCC's Contracting Principles on Your Force Majeure Clauses

The world is currently facing the coronavirus and its fatal consequences. Companies are facing delays, termination of contracts and claims for damages. At the moment one of the most important and discussed clauses in the contract is the Force Majeure clause. Many companies have not drafted their contract clauses adequately and therefore face difficult negotiations on e.g. termination, claims for damages etc.

How to Enforce Force Majeure the Right Way in the COVID-19 Era

COVID-19 has changed the dynamics of international trade and contracting so much that an increasing theme for contracts today appears to be invoking force majeure provisions to help ease the hardship the pandemic has spawned.

Business Disruption and Commercial Contracts (Part 5): Once Force Majeure Is Asserted, What are Our Rights and Obligations?

If it is your counterparty that invokes force majeure to excuse its performance, it is important that you understand what your own obligations and rights are, how to enforce those rights, and how to challenge the assertion of force majeure if you do not believe it is justified. The declaring party must be able to defend the invocation of the force majeure notice and justify whether all or just part of the performance should be excused. The analysis will be highly fact and contract-specific, and this guide provides a starting point to evaluate next steps and build your strategy after a force majeure event is declared.

Force Majeure and Other Options

No Force Majeure Clause? Other Potential Options to Excuse Contractual Performance Under US Law in the Face of COVID-19

The rapid spread of the novel coronavirus disease and the varied government responses thereto have caused significant disruption to commercial operations and relationships. Some companies are considering whether the outbreak constitutes a force majeure event, but what if your contract does not include an express force majeure clause? Before concluding that there is nothing that you or your contracting counterparty can do when facing disruptions as a result of COVID-19 (or a crisis event generally), take a close look at the applicable law.

COVID-19 Contractual Performance – Force Majeure Clauses and Other Options: A Global Perspective

This legal update describes options that may be available to parties with contracts affected by COVID-19. In particular, we focus on the concept of Force Majeure, which translates from French roughly as "a major force", and which may excuse a party from the performance of its contractual obligations.

Insights

Managing Risk and Uncertainty

In 2018, IACCM (now World Commerce and Contracting) was commissioned to identify ‘leading practices in post-award contract management’. Following intensive study, we had not found any organization that could claim a consistent post-award capability, especially for more complex forms of relationship.

Good contract management is not about simply having a robust process and properly skilled and equipped teams. As with any process, the real measure of success lies in the quality of the deliverable and what we discovered was plenty of individual examples of excellence, but none that demonstrated consistency across an entire contract portfolio.

Sally Guyer, Executive, board director, mother and entrepreneur

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