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Tuesday, April 14, 2020

May the Force be with you

One medical website describes an epidemic as including "any problem that has grown out of control". It distinguishes pandemic by the breadth of the "problem".  "An epidemic becomes a pandemic when it spreads over significant geographical areas and affects a large percent of the population. In short, a pandemic is an epidemic on a national or global level."


Now, of course, that website was referring to disease, a disease usually caused by a tiny, hard to decipher critter of some sort. one which at the extreme threatens the survival of the human or  other species.  But, by that definition, in a world organized by contracts, the world is now also caught in the grips of a force majeure pandemic. One London based firm, Farrer & Co., elucidates (though, in my usual slice and dice tossed salad rendition, I have "taken license" of their explanation to assist the mad scheme of this blog, so you are implored to read the original at that link):
Attention is now turning to whether businesses and their suppliers, customers and commercial partners can continue to perform their contractual obligations in spite of the fundamentally different situation in which they find themselves and, if not, what consequences flow from that.

These events shine a spotlight on contractual small print and legal concepts that perhaps provoked little thought in more normal times. They may now be critical to business survival.

Contrary to common perception, there is no statutory or common law definition of force majeure or a force majeure event in English Law. The parties to a contract therefore have the freedom to agree what will amount to a force majeure for the purpose of their contract and what the consequences will be if such an event happens. That means there are no generic answers to questions about how force majeure applies – each party must look at the wording of their own contracts to establish how it works in the relevant circumstances.
That caveat makes Dr. Fauci's assertions and Trump-inspired qualifications look down right transparent. But, it is a sound description of the beast.

As the authors cited cautioned, "This note is designed to be of general application," and it does pretty well hold true around the world, regardless of legal system. So, again, if you need a broad grounding in force majeure, that article is a good place to start. Another broadly examined article dealing generally with the force majeure-like factual issues that arise in this particular Covid-19 pandemic I'd recommend is Coronavirus/COVID-19: Implications for Commercial and Financial Contracts from the firm Skadden, Arps, Slate, Meagher & Flom LLP and Affiliates.

Given the vagueness, or vagaries, of legal theories resulting because of or in the midst of a medical pandemic, and the slippery facts upon which it all rests, I do not attempt to provide my own discussion of the legal issues. But, all you have to do is search online the topic "covid-19 force majeure" and you will see a swarm of force majeure discussions from around the globe, each lying in wait for your interest.

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