Force majure in contract

Act of god, unforseeen event

Force majure translates from French term as superior force. It is basically a French terms derived in law having its roots in French law. Force majure means uncontrollable events or act of god or natural calamity which is beyond control of human being which creates hurdles in business, transactions or any contract to be preceded or carry out normal course of business.

A company may insert a force majeure clause during the contract to absolve itself from liability in the event it cannot fulfil the terms of a contract (or if attempting to do so will result in loss or damage of goods) for reasons beyond its control. A force majeure may work to excuse all or part of the obligations of one or both parties. Force majeure is a clause that is included in contracts to remove liability for unforeseeable and unavoidable catastrophes that interrupt the expected course of events and prevent participants from fulfilling obligations.

Force majure in insurance is also an important factor for ascertain the risk of any property, contract or protecting insurable interest. In insurance, force majeure clauses are typically included in policies to protect both the insurer and the insured from the financial consequences of events such as natural disasters, war, riots, strikes, and other events that are beyond the control of either party. In case a hurricane damages a property covered by an insurance policy, the force majeure clause would typically come into play to protect the insurer from having to pay out for damages that were caused by an event that was beyond the control of the insured party. Similarly, if a pandemic or other unforeseeable event disrupts a contract or business operation, the force majeure clause can protect the parties involved from financial losses that might result from the interruption. The purpose of a force majeure clause is to allocate the risk of loss between the parties to the contract in the event of an unforeseeable and unavoidable catastrophe that prevents performance.

Force majeure events are typically defined in the contract and may include events such as natural disasters, acts of war or terrorism, government actions, strikes or other labor disputes, and other events that are beyond the control of the parties to the contract.

It is important to note that the force majeure clause does not excuse a party from performing its obligations under the contract indefinitely. Instead, it usually provides for a temporary suspension of obligations until the force majeure event has passed or has been resolved.

If a force majeure event occurs, it is important for the parties to the contract to communicate with each other and work together to minimize the impact of the event on the performance of the contract. In some cases, it may be necessary to renegotiate the terms of the contract or seek legal advice to resolve any disputes that may arise

Common contracts were force majure is included-

Event contracts

Wedding contracts

Insurance policies

Photography contracts

Service contracts

Operating agreement

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