The Importance of Force Majeure Clauses During Civil Unrest

All across the country, cities have been experiencing mass protests in response to George Floyd’s death in Minneapolis on May 25. While some businesses in heavily impacted jurisdictions are boarding up their facilities or suspending operations, there is an additional way for businesses to protect themselves from any disruption of business as a result of the demonstrations: force majeure clauses.

As mentioned in our prior post, force majeure clauses are typically placed in business contracts and act as an agreement that if a business’s promised performance is prevented or made impossible by an event beyond its control, the performance can be delayed or excused without any contractual liability. Whether or not a business can rely on this clause to protect it from liability of not performing depends on its wording and how it will be interpreted under state law.

While we initially covered force majeure as it relates to COVID-19, these clauses are not limited to pandemics or other natural events. This Bloomberg Law analysis explains how they can also be used to protect against human-made events such as protests and civil unrest. However, as with COVID-19, it is crucial that the force majeure clause specifically includes this type of interruption in the contract language. We expect to see more inclusions of “civil unrest” and “protests” in force majeure provisions as a result of the recent weeks’ events.

If you are wondering if protests or civil unrest is covered in your business’s force majeure clause, please do not hesitate to contact Busch Mills. Our experienced legal team can determine what’s covered in your force majeure clause now and provide expanded provisions for what’s covered in the future.