Force Majeure
I have been reading, writing and executing capital project contracts for 52 years. Most have had a Force Majeure clause.
However, I have never seen a Force Majeure clause executed until just a couple of years ago. Now I have seen this happen three times on three different projects.
What is Force Majeure? A legal definition is "unforeseeable circumstances that prevent someone from fulfilling a contract." That "someone" can, of course, be a person or a company.
Why the sudden rash of Force Majeure incidents? Let's look at these three without disclosing the companies or projects involved.
One was due to Covid. Startup personnel were recalled to their home country when Covid broke out.
One was due to last year's transportation problems. Prices rose and delivery was delayed.
One was due to the Russian-Ukraine War. A supplier could no longer get subcontracted parts manufactured in Russia.
Yes, we live in a more turbulent world. We also live in a more litigious world. Suppliers are concerned about being sued and, I think, see Force Majeure as a pre-emptive action on their part.
Anyway you look at it, Force Majeure seems to no longer be just words on a page.