Construction professionals here in Texas have seen their projects plagued by extreme weather of all kinds at all times of the year. That’s just one reason why a force majeure clause is necessary in your contracts.
Force majeure means “superior force.” That can certainly apply to storms, floods and other weather-related events. However, a solid force majeure clause can also protect contractors, builders and anyone who has committed via contract to having a project completed within a specified timeframe and for an agreed-upon cost.
If there’s any kind of unexpected and unavoidable circumstance that prevents meeting those commitments, this clause can prevent civil litigation or having to bear the full cost of a delay or the shutdown of a project. This can include a labor strike, a materials shortage or a serious supply chain issue.
Backup plans are still necessary
It’s important to understand that a force majeure clause doesn’t prevent the need to have a backup plan (or multiple plans) if various things go wrong. It also doesn’t relieve you from anticipating potential issues and planning for them as much as possible.
For example, you likely know if a strike could be on the horizon or if the price of specific materials is set to rise. Failing to anticipate and plan for potential problems may make a force majeure clause unenforceable in particular situations.
Be prepared to negotiate
Of course, the other party to the contract may want to negotiate this and other clauses to protect themselves as well. In addition to addressing how the parties will split any additional costs or losses, you’ll likely want the clause to specify things like under what circumstances the clause can be invoked, who must be notified if it’s invoked and how soon.
There’s no such thing as a good “one-size-fits-all” force majeure clause. You’ll want one that fits your needs for a specific project and client. Having legal guidance as you draft and negotiate it and all parts of your contract is the best way to prevent unnecessary losses and potential litigation.
