Force Majeure Clause

Force Majeure is a French word that means greater force in English. It is a concept in contract law that describes a clause included in many contracts that releases the parties from their contractual obligations in the event of highly unusual circumstances. Force Majeure Clauses allow a party to be free from a contract for catastrophes that were not foreseeable. If the event meets the contractual obligations, both parties can end the agreement without penalty. It is connected to the unforeseen and unexpected happening of the event. 

Force Majeure Clause 

The contractual clauses restrict parties from obligations and liabilities under an agreement when sudden unexpected circumstances take place which is called Force Majeure Clause. These events occur beyond their control thus preventing them from performing their obligations. The Force Majeure Clause only suspends the obligations for a certain duration of the force majeure. These unprecedented events include not only acts of God like earthquakes, tsunamis, hurricanes, volcanoes, droughts, famines, etc but also human triggered actions like wars, strikes, crime, epidemics, terrorism, etc.

The incidents make it impossible to fulfil the contract as it is an overpowering force. These events have the following factors:

• Beyond one’s control
• Hard to be prevented
• Unreasonable, unprecedented event
• Impossible to perform the obligation.

Precautions are taken to reduce the losses, and an  attempt is made to lessen the damage, or alternate resources are implemented.

Force Majeure Clause Examples

Examples of situations that are based on the force majeure clause include:

1. Planning an event: If the worst happens and if you need to cancel your plans due to catastrophic events then this clause can help in covering the vendor and hotel or auditorium liabilities.
2. Private Photography sessions: The photographer will not be liable for the inability to perform their duties due to an unexpected event. If the client needs to get the booking fee back then they have to mention the correct circumstances that caused the cancellation of the event

Some other examples include professional partnerships, wedding arrangements, insurance policies, etc.

Force Majeure Clause India

The legal provisions for the force majeure clause in India come under the sections of the Indian Contract Act 1872, which are Section 32 and Section 56 stipulate laws related to Force Majeure.

• Section 32 of the Indian contract Act 1872- Deals with the enforcement of contracts conditioned on an event happening. It specifies to perform any obligation under the contract that becomes certain on a happening of uncertain future matter. These contracts are enforceable until a specific event occurs. When the party finds the event impossible then the agreements become void.
• Section 56 of the Indian Contract Act 1872- It is the Doctrine of Frustration. The desirable future event is obligated to be performed that cannot be prevented by the claiming party due to negligence of the party because it cannot be self-induced.

The Supreme Court of India laid down the guidelines to be mindful of while invoking a force majeure clause:

1. The events which are beyond control and the obligations of the parties cannot be performed then the parties shall not be held responsible for such non-performance of duties.
2. When a particular event occurs, the duty becomes impossible to perform.
3. The unavoidable events that occur even after taking the measures in their capacity to curb unforeseen are required to qualify as force majeure.
4. While analysing the force majeure clause the parties’ potential to minimize these unexpected events is taken into consideration.

The Indian Government has stated the Covid-19 outbreak as Force Majeure.

Conclusion

The party’s needs and requirements are considered while drafting the Force Majeure Clause. The set of obligations parties are kept in mind for preparing unique contracts. The Clause is made with utmost clarity and in the best interest of the parties. It is important to study the party’s interests and their views while choosing a contract. Thus, every agreement or contract that has a force majeure clause should be discrete, subjective and with certain customs based on the requirement of the parties. It is of paramount importance to carefully and appropriately draft the Force Majeure Clause in the agreement so that the client is saved from a huge number of losses or damages that can affect when a particular event is not drafted in the clause. Then only the force majeure clause can be invoked in a specific situation which is unavoidable.