Legal Definitions - force-majeure clause

A force-majeure clause is a part of a contract that deals with situations where performance becomes impossible or impractical due to an unforeseeable event or circumstance that is beyond the control of the parties involved.

For example, if a company has a contract to deliver goods to a customer, but a natural disaster such as a hurricane or earthquake makes it impossible to do so, the force-majeure clause would come into effect. The clause would specify what happens in such a situation, such as whether the contract is terminated or whether the delivery is delayed until the situation is resolved.

Another example could be a contract between a performer and a venue for a concert. If the venue is destroyed by fire or other unforeseeable event, the force-majeure clause would determine what happens to the contract, such as whether the concert is rescheduled or cancelled.

The force-majeure clause is important because it helps to allocate the risk between the parties involved in a contract. It ensures that neither party is held responsible for events that are beyond their control, and that they are protected from any losses that may result from such events.