In the event of government action due to a declared emergency, such as a pandemic, performance under contracts like construction or lease agreements may become delayed or impossible.

For example, government action may delay or prohibit timely access to services such as inspections, permit granting, application review, plan review or document recording and adversely impact deliverables. Government action may also prevent a tenant in a commercial lease from maintaining the rented space for its contractually required use, such as a dine-in restaurant, bar, gym or salon. 

In such circumstances, parties may be relieved from performance by the terms of a force majeure clause, or may otherwise be able to assert force majeure or impossibility of performance as a legal defense to claims for breach or delay damages.  

A force majeure clause is a common provision in contracts that excuses a party from performing its contractual obligations due to unforeseen events beyond its control. Similarly, the doctrine of impossibility of performance is a legal defense that applies to unforeseeable circumstances that make contract performance impossible through no fault of the party seeking to assert the defense.

Such unforeseen events may include acts of government, such as a mandated shutdown of private and/or public services.

To preserve the protections of force majeure under a contract, the invoking party may be required to provide notice to the other party of the delaying event or take other preliminary steps to address the situation and preserve any future defenses for the inability to perform under the contract.  

Compliance with the contract’s notice requirements is critical, and failure to properly and timely comply with notice requirements could result in a waiver of a force majeure or impossibility of performance defenses.

If you need assistance with analyzing your duties and rights under your contract, or with providing any notice required to preserve your protections and defenses, please contact the author.

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Matthew M. Ries is a business and employment lawyer with Harrington, Hoppe & Mitchell. He can be reached at (330) 392-1541 or at mries@hhmlaw.com.