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FORCE MAJEUR (VIS MAIOR) and its influence on contract obligations

Anna Miśtal-Kluś25 March 2020Komentarze (0)

The Coronavirus disease and its vast social and economic effects have caused that we are all looking for extraordinary measures, also in legal matters. As so many lines of business have already been affected by the lockdown induced by the epidemic, most of entrepreneurs already face great problems with payments and having no possibility to perform their contract obligations (e.g. paying rent, producing and selling goods or performing different services). There is a question if it leads to any negative consequences for them – especially to obligation to remedy a damage of the other contract party or to pay a contract penalty.

 

FORCE MAJEUR

The situation we are facing facing with can be described as an example of force majeur („superior force”, meaning an unexpected circumstance or an unavoidable event). It has a specific legal meaning and is often governed by contracts as a special clause. In order to analyse the risks connected with the current unexpected epidemic situation the first thing to do is to read the contracts of your company and check if there are any specific regulations concerning force majeur. Such clauses might free both parties from liability and obligations when an extraordinary event happens (e.g. war, act of terror, riot, strike, fire, epidemic, hurricane, flood, etc.). Such terms might free the parties to fullfill their contract obligations entirely or only during the period of duration of force majeur. However it is possible that the later fulfillment of obligation will be no longer possible after the force majeur recedes, which also might be treated as a result of force majeur. However, the contract may also stipulate that the force majeur does not free the debtor from liability to perform the contract obligation.

If there are no regulations in contracts concerning force majeur or they do not cover a certain type of unexpected circumstance there are also legal provisions which might be applied in such situations. As far as Polish law is concerned there is no legal definition of force majeur, however the influence of the unexpected events on fulfillment of contract obligations is governed by art. 471 of the Polish Civil Code which stipulates:
„A debtor is obliged to remedy any damage arising from non-performance or improper performance of an obligation unless the non-performance or improper performance is due to circumstances for which the debtor is not liable.”
The above mentioned provision exempts the debtor from the liability against the other contract party if he incurred a damage, if the non-performance or improper performance of the contract was not his fault. It would happen also in case of force majeur.

If there is a contract provision concerning the contract penalty, the debtor may also free himself from obligation to pay the contract penalty in case if the non-performance or improper performance of the contract is due to circumstances for which the debtor is not liable (art. 483 in connection with art. 471 of the Civil Code).
As the force majeur is a so called „general clause” there are no stiff rules of how it is to be applied and every situation is to be analysed separately, because a certain unexpected event might affect various types of business differently. Therefore in practice interpretation of contract provisions or of the above mentioned art. 471 and art. 483 of Civil Code might lead to disputes between the parties. E.g. the question might be if a party could prepare itself for the results of epidemic, especially by securing in advance the materials needed for manufacturing of certain goods, particularly if it was earlier known that the epidemic would most certainly spread all other the World during the coming weeks before it became impossible to perform the contract obligations. This example shows another problem to be examined: what is a required due care of the debtor while performing a contract, i.e. if in case of a risk of epidemic he was obliged to undertake ordinary steps or maybe he was obliged to behave in an extraordinary way in order to perform the contract.

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