The term refers to a “force outside the control of a party,” and a growing number of people are asking whether the COVID-19 pandemic fits the bill or if they should include it in their future contracts. However, there isn’t much legal precedent to draw from that gives the industry a definitive answer.
Can a client cite “force majeure” in their contract? “The answer depends on the specific contract language, local law, and the causal connection between the pandemic and the parties’ ability to perform their contractual obligations,” the American Bar Association notes at its website.
Force majeure provisions can be found in several types of real estate documents, such as loan commitments, leases, property management agreements, construction contracts, development agreements, and sometimes purchase and sale agreements.
