IP, Technology & Data

The recent no fly zone across (most of) Europe because of the Icelandic volcano has made me think about force majeure clauses (sometimes known as “Act of God” clauses). 

A force majeure clause is a clause in a contract that excuses a contract breach where the “breaching party” cannot perform because of an event outside its reasonable control. So for example, if I had an obligation to you to supply 10,000 widgets by 1 May 2010, but my factory was struck by lightning and burned to the ground in the middle of April, then the force majeure clause might protect me from your claim for contract breach.     

Is the no fly zone a force majeure event? It might prevent an individual or an air-freight item getting somewhere in time, which might otherwise be a contract breach. So possibly, yes. 

However, you have to check the drafting of the relevant clause carefully. Also if the contract has no force majeure clause then there is no relief (the Courts do not imply them).

All that said in my 15 years of being an IT lawyer I have never seen a force majeure clause used in defence of a “you didn’t perform” claim. My colleagues in litigation echo this, i.e. it’s not something they see used very often. 

One final thought on this. Force majeure clauses are often considered to be contract “boiler plate”. That is, relatively standard clauses towards the rear of the contract. Sometimes contract reviewers have “switched off” by the time they get to the force majeure clause. That can be dangerous because sneaky lawyers can hide nasty stuff in the force majeure clause. In fact when acting for suppliers I have been known to slip some stuff in there myself. 

This is particularly relevant in the area of telecoms / internet services / hosted services / SaaS where I have seen some events included in the definitions of force majeure that I think the supplier should be on the hook for. Something to watch out for.

IP and Technology

Brodies offer the market leading technology, outsourcing and information law practice in Scotland, delivering up-to-the-minute, commercially-focused, relevant specialist knowledge to clients operating in every sector of the Scottish economy. Find out more at http://www.brodies.com/legal-services/ip-technology-outsourcing
IP and Technology