Does Your Force Majeure Clause Work?

Force majeure clauses have come into sharp focus recently. These clauses are intended to govern what happens if an event beyond the control of the parties affects the performance of a contract. Their purpose is to mitigate the uncertainty and unfairness associated with the doctrine of frustration (the default position under English law) and to ensure that the defaulting party is not unfairly put in a position of breach. A typical force majeure clause will define:

• the events that give rise to force majeure; the event and its impact are usually stated to be beyond the reasonable control of the party relying on the clause;
• the impact on the performance of the contract and the degree of disruption that will trigger the right to rely on the clause;