What Needs to Be in A Force Majeure Clause?
Feb. 16, 2022
As a contractor, you know that you need a “Plan B” and maybe a “Plan C” in case the unexpected happens. Some things, however, aren’t in your control. That’s why there are force majeure clauses.
Force majeure (“superior force”) clauses can limit your liability in the event of a hurricane or other damaging weather event like we know all too well in Mississippi. It may also be able to help you if there’s an unexpected shortage of material or labor.
Force majeure clauses, like all provisions in a contract, need to be well thought out. It’s best that they aren’t too broad or too specific. However, you need to specify some things – like when the force majeure clause would go into effect. It’s also wise to include details like who needs to be notified if the clause is invoked and how soon. You should also describe the parties’ obligations regarding things like payment if the project needs to be delayed or even scrapped.
A Force Majeure Clause Isn’t Guaranteed Protection Against Liability
Including a force majeure clause in your contracts is crucial. However, it doesn’t always protect you from liability. For example, if your customer can show that you could or should have foreseen and planned for an unexpected event (like a materials shortage or labor strike), they can argue that the force majeure clause doesn’t apply.
Invoking a force majeure clause should be your last resort. It’s typically best to keep the lines of communication open and reassure them that you are committed to the project. However, it’s nonetheless crucial to have a legally sound force majeure clause in your contracts.