Force Majeure - What Does this Entail?

By Robyn ShepherdCategory: Contract Law

Introduction 

Force majeure is a contract clause that frees both parties from liability or obligation when an extraordinary event or circumstance is beyond the parties' control. Examples of these events can be a war, strike, riot, crime, plague, or an event described by the legal act of God preventing one or both parties from fulfilling their obligations under the contract.  

South African law is stringent as it does not exclude the performance of a contract in all cases of force majeure. Several conditions must be satisfied for a force majeure to trigger impossibility to perform, namely: 

the impossibility must be objectively impossible; it must be absolute; it must be absolute as opposed to relative. Therefore, if it relates to something that can, in general, be done, but the one party seeking to escape liability cannot personally perform, then such party remains liable in the contract; the impossibility must be unavoidable by a reasonable person; it must not be the fault of either party; and the mere fact that a disaster or event was foreseeable does not necessarily mean that it ought to have been foreseeable or that it is avoidable by a reasonable person. 

Is It Impossible For A Party To Fulfil Its Obligations Under The Contract? 

There is a duty to use reasonable efforts to alleviate and mitigate the cause and effect of the force majeure event and resume the performance of its obligations once it can do so. However, a party who does not perform due to a force majeure cannot be sued for any damages suffered by the other party due to the non-performance of the other. 

Conclusion  

Companies should take reasonable steps to mitigate force majeure events where permissible. Failing, a party may not successfully rely on force majeure as a mechanism to be excused from their obligations. 

Contact an attorney at SchoemanLaw Inc for your contractual needs by visiting our website at www.schoemanlaw.co.za.    

Robyn Shepherd | SchoemanLaw Inc Civil Dispute Resolution and Contract Law Specialist www.schoemanlaw.co.za