Overview

Force majeure is a clause commonly featured in contracts to essentially free both parties from liability or obligation when an extraordinary event or circumstance beyond the control of the parties, such as a war, strike, riot, crime, or an event described by the legal term "act of God" (which includes flooding, earthquake, or volcanic eruption), prevents one or both parties from fulfilling their obligations under the contract.

The force majeure clause was never intended to excuse negligence or other malfeasance of a party, or where non-performance is caused by the natural consequences of external forces, or where the intervening circumstances are specifically contemplated.

Despite this, property developers who have hit on hard times and exhausted all contractual provisions to extend handover, have resorted to exercising the force majeure clause to negate them of liability for failing to deliver on promise.

Hadef & Partners provides the details.

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