While force majeure clauses
are common, and typically buried in the final paragraphs of a contract, they are worth a second look.
A good force majeure clause
provides the company with flexibility when a portion of its contracted supply chain breaks down.
(6) It is interesting to note that while the above clause was interpreted by the Court as a force majeure clause
, it did not expressly include the words "force majeure".
Such an approach is akin to the conventional force majeure clause
in commercial contracts, excusing performance on the occurrence of specific types of events.
However, arguably every force majeure clause
should be unique - making sense in the business context of the particular contract and making a sensible allocation of the risks which may affect performance.
Every supplier and consumer of natural gas should review its natural gas supply agreements to see if they contain a force majeure clause
. Because force majeure clauses
vary even within an industry, suppliers and consumers should ensure that if they have multiple supply contracts--both vertical (upstream and downstream contracts) and horizontal (contracts with multiple customers)--the force majeure clauses
therein are aligned so that the effect of a hurricane or other weather event is treated consistently in all transactions.
Force majeure clauses
enable a party to contractually avoid liability due to an irresistible, natural or unavoidable force.
The consortium of Japan Bank for International Cooperation (JBIC) and Nippon Export Insurance (NEXI), which asked for force majeure clause
in the contract, was favored by the government before it demanded later the loan guarantee considering security problem in the country.
indicates that contingency clauses, such as the force majeure clause
In granting Hearst a limited summary judgment in its lawsuit to prevent the Times from forcing an end to the JOA, King County (Wash.) Superior Court Judge Greg Canova said, in effect, that Blethen and Times officials could not have it both ways -- claiming two years ago that the JOA's force majeure clause
applied to the 49-day Christmas season strike in 2000, then saying in court this year that it did not.
Notably, after the September 11 tragedy, a vendor likely will insist that a terrorist act'' be included in any Force Majeure clause
, although the general language of many clauses would suffice to cover such acts.
Two issues deserve consideration for most franchisors: the force majeure clause
and the arbitration clause.