France’s Contribution to Contracts

While the French have made countless fantastic contributions to cuisine and culture, many of which can be easily recited by people around the world, one particular contribution from the land of champagne and baguettes is of  a less auspicious nature. It is France’s one contribution to commercial contracts… the force majeure clause.  This ubiquitous, but all but ignored, provision finds its way into virtually every commercial and construction contract today as it has for more than a century.  Just look for it, you are likely to find it.  It rarely takes center stage, but somewhere in the deep recesses of miscellaneous terms it will make its glorious and exotic sounding appearance.  Despite its distinctive, regal French title, it is typically overlooked, glanced over, or downright ignored.  The universal snub and disrespect of this seemingly superfluous provision can prove costly when on occasion it takes its revenge on the unprepared.  Well, force majeure would ask rhetorically in its defense, how would you feel to be the stepchild among such other ordinary provisions as subrogation, choice of law, and insurance?  

The intent of force majeure clauses is to excuse performance when an unavoidable event occurs.  Literally, force majeure means a superior or irresistible force.  Over the years a typical list of events that cannot  reasonably be anticipated or controlled by the parties to a contract has been developed and has come to be included in force majeure clauses.  These include, among others, acts of God, the usual natural disasters of floods, hurricanes, tornados and earthquakes, war and terrorist attacks. 

In reviewing and negotiating contracts, force majeure clauses should not go unread.  They should be amended and supplemented if appropriate. Initially one must be certain to confirm that the force majeure clause is mutual and excuses either party from performing in the face of an unavoidable event.  One should also consider expanding the list of events that will excuse performance to include such contract specific events as a  failure of suppliers or carriers if this is relevant to the subject matter of the transaction or the ability of a party to perform  the contract. If a party is prevented from performing its contract obligations by an event that is not within the force majeure clause, that party runs a real risk of being liable to its contracting partner for all costs and other damages resulting from the failure to complete performance of the contract.

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Harrisburg Magazine Readers' Choice 2011