Force Majeure in Commercial Contracts: Limits and Practice

An unexpected event can suddenly render a contract signed years earlier impossible to perform. In such moments, "force majeure" is one of the first concepts invoked — yet it operates within a narrower and more technical frame than is often assumed.

What is force majeure?

Force majeure is an extraordinary event — unforeseeable, unavoidable and not attributable to the debtor's fault — that makes performance impossible. Natural disasters, war, epidemics, a general strike or a newly imposed legal prohibition are typical examples. What matters is not the label of the event but whether it carries three elements together: unforeseeability, unavoidability and externality.

The force majeure clause

Parties are free to define force majeure in the contract themselves. A well-drafted clause sets out which events are covered, the notice period owed to the counterparty, and the consequences of the event (suspension, extension of time, termination). In practice, a large share of disputes arise either because this clause is absent or because it is drafted too broadly.

Impossibility or hardship?

A critical distinction applies here. If performance has become truly impossible, the obligation generally comes to an end. But in most commercial disputes performance is not impossible — merely excessively onerous. This second situation is treated as "hardship", and its result may be not termination but adaptation of the contract.

The adaptation claim

Where an unforeseeable event, arising after the contract was formed and not caused by the parties, upsets the balance of performances to an intolerable degree, the debtor may seek adaptation of the contract to the new circumstances, or — if that is not possible — rescission. Adaptation is the measured route: it aims to keep the contract alive.

Burden of proof and notice

The party invoking force majeure bears the burden of proving both the existence of the event and the causal link between that event and the obstacle to performance. Most contracts also require the event to be notified to the counterparty in writing within a reasonable time. A notice given late can weaken even a fundamentally sound claim.