Product Update

Force Majeure Clauses Discussed in Contractual Risk Transfer

This release of Contractual Risk Transfer (CRT) contains a new discussion of force majeure clauses.

Force majeure clauses are common commercial contract provisions that excuse or relieve a party from performing its contractual obligations when certain events or circumstances arise that are beyond the parties' control. When properly negotiated and drafted, force majeure clauses are useful and important provisions that help parties allocate risk so that they avoid costly penalties under the contract if they are unable to perform their obligations when events outside the parties' control frustrate performance or make performance impracticable or impossible. Force majeure clauses can also help parties avoid costly litigation or alternative dispute resolution proceedings when events outside the parties' control materially affect or impact performance under the contract. Although force majeure clauses are found in a variety of contracts and agreements, many contracting parties are not familiar with the practical details of these provisions. This CRT release contains a new discussion of force majeure clauses to help you better understand how these provisions work.