Insights With Trent Munday

Force Majeure is defined as - unforeseeable circumstances that prevent someone from fulfilling a contract. Many contracts have such a clause. It would typically come into play in the event of a tsunami or earthquake or similar. But this current COVID-19 Crisis, according to most interpretations, would qualify as a force majeure event. That means, if you have a contract with another person or company, they may be able to avoid their obligations to you at this time. If that obligation includes them paying you money for goods &/or services rendered, you could be in trouble. Further, oftentimes these force majeure clauses will allow either party to cancel the agreement completely if the event last more than a certain period of time - 3 mths, 6 mths or more. So, best you check your agreements and make yourself aware of the short term and long term impacts on your business if a force majeure is declared. #forcemajeure #contractual #covid19