Is The Force (Majeure) With You? It Depends On The Terms

The Ontario Court of Appeal weighed in on the consequences and remedies of a force majeure. While many cases focus on whether a force majeure event has occurred, here it was not in dispute. In contrast, this case illustrates the wide latitude parties have to create tailored contractual remedies when a force majeure event occurs, including remedies that provide immediate relief to only one party and shift the entirety of the risk to the other party.

In Niagara Falls Shopping Centre Inc. v. LAF Canada Company, a landlord claimed force majeure when COVID-19 government orders closed Ontario gyms¹. The tenant sought rent relief for the same period. The Court of Appeal refused, instead enforcing a contractual "pay now, be compensated later" remedy in the lease. The lease's terms relieved the landlord of its obligation to provide access to the premises during a force majeure event but required the tenant to continue paying rent during the same period. The tenant's