THE ONE CLAUSE IN A CONTRACT THAT COVID 19 HAS FORCED MANY TO GO IN SEARCH FOR

Force Majeure and the Principal of supervening impossibility 🤯 Sound complicated? To the average person what exactly does it mean?

Well let me give you a practical example.. let’s say for instance you entered into a contract in February 2020 to Render a certain service or provide certain goods. “Cue the entrance of a global pandemic “CORONA VIRUS”. What do you do once you can no longer provide said service or goods due to either the restrictions placed as a result of the pandemic, a national lockdown, or any disruption caused by it.?

Automatically you will be thinking to yourself shouldn't your contract Have made any provision for this. And so you hastily search for the contract you signed to read through it thoroughly as you now fear a possible breach of the contract.

If your contract has a FORCE MAJEURE CLAUSE you may just be in luck, here’a why:

 A force majeure clause in essence deals with how the obligations set out in a contract is affected by “a force of God” or any event arising out of the control of a party that renders performance under the contract impossible, for example a natural disaster, a global pandemic?, a riot or war. Your option to either use this clause or enforce it on the other hand is dependent on the manner in which it was drafted. 

If drafted narrowly, the clause will set out a list of specific events which apply. This means that if for example the clause sets out specific events which do not include a global pandemic, your invocation of such a clause may be faced with some difficultly.

If drafted widely, the clause may set out example of events but may have the wording ‘any event arising out of the control of the parties, that may render the performance impossible’. If this is the case you may invoke the clause with little to no difficulty.

Now what happens if your contract does not have a force majeure clause? 

You will then rely on the common law “principle of supervening impossibility”. According to South African common law, if an event or situation arises without any fault from either party, and such event renders the performance in terms of the contract impossible, such party who is unable to perform is excused from failure to perform. 

However it is important that for both the principle of supervening impossibility and invocation of the force majeure clause to remember that you must be able to prove that your performance is IMPOSSIBLE due to the event and not merely inconvenient, difficult or economically onerous. Also you cannot rely on the fact of the occurrence of the event as an excuse. It is the aspect of impossibility to perform that must be proven.

Whether you find yourself in the same predicament above and wish to invoke this clause or the other party anticipating that such clause may be invoked contact us and let us guide you through it!