Viewpoint: Force Majeure Clauses - What Are They and What Do They Mean?

The widespread impact of the COVID-19 virus on our daily lives is evident. Restaurants and bars are closed or closing, travel is restricted, and many of us are working remotely.

For businesses, the outbreak may mean an inability to fulfill orders, provide services, make payments, or meet other contractual obligations.

A force majeure clause is a contractual provision that seeks to (a) allocate among the parties the risk of certain events that are beyond their control and (b) mitigate the negative effects of such events.

For those seeking to terminate a contract or otherwise excuse performance because of COVID-19, such clauses may provide relief, but should be examined carefully.

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