In light of the effect of COVID on many contracts businesses are recommended to review their terms of business for future protection. The inclusion of a force majeure clause can give some certainty in an uncertain world. The force majeure clause provides for the contract to be suspended or terminated in certain named circumstances such as a pandemic.
When considering if the force majeure clause would apply foreseeability requires to be considered. Reasonable steps require to be taken to avoid the risk even if the event is named as a trigger event such as fire or malicious damage. Whilst the first lockdown as a result of the pandemic may be regarded to have triggered the force majeure clause as it was unforeseeable the second and subsequent lockdowns may be viewed differently. Parties to a contract should accordingly take steps to guard against the risk of subsequent lockdowns and the effect on their contract.
