What is a Force Majeure Clause?

One way to think of a force majeure clause is as language in the contract that covers “stuff happens.” Sometimes, when you sign a contract, things beyond your control keep you from performing what you promised. You have every intention to perform according to the deal, but you simply cannot.

This Clause Covers You During Disasters and Crisis

These days, nearly every contract contains a force majeure clause. In plain language, this clause excuses you from performance if there are things like natural disasters, pandemics, or bad weather that make living up to the terms of the contract impossible or inadvisable. If you do not have this clause in the contract, you would be forced to rely on the much more limited protections that common law gives you. Then, you may have to pay a cancellation fee or be subject to a lawsuit for breach of contract.

A force majeure clause is what can give your business greater flexibility in times of crisis and reduce uncertainty. This clause is what protected many business owners during the COVID-19 pandemic and throughout the current supply chain crisis.

Pay Attention to the Language of the Force Majeure Clause

A force majeure clause on its own may not be enough to give you full protection. The language of the clause matters. It will set out the various events that could be considered force majeure. As a business, before you have this clause, you should consider the types of events that would keep you from performing the contract. Then, you should carefully negotiate this clause to meet your business needs.

Call an Atlanta General Contracts Lawyer

Before you sign business contracts, you should have an attorney review them to maximize your legal rights. Call Battleson Law LLC today at 470.398.0720 or contact us online to discuss your business legal needs.

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