Guide · Commercial

Force Majeure, Impossibility, and Excuse: A Comprehensive Guide to Contract Performance Under Disruption

Type
Guide
Jurisdiction
National
Date
2023-10-08
Topic
Commercial

A complete practitioner's treatment of contractual excuse and the devices that allocate commercial risk before excuse is ever needed. Parts I through III cover the architecture of risk allocation, the construction of force majeure clauses including the enumerated-versus-catchall problem, and the causation, notice, and mitigation conditions that decide most disputes. Parts IV through VII cover the common law fallbacks: impossibility and impracticability under Restatement sections 261 through 264, the sales overlay in UCC sections 2-613 through 2-616 and CISG Article 79, frustration of purpose, and the foreseeability and assumption-of-risk limits that defeat most claims. Part VIII covers government action, change-in-law clauses, and the sovereign acts doctrine, and Part IX covers material adverse change and MAE clauses in acquisition agreements after Akorn and AB Stable. Parts X through XIII cover indemnification and defense obligations, limitation of liability and consequential damages waivers, liquidated damages and the penalty rule, and the interlocking questions of conditions precedent, representations and warranties versus covenants, and sandbagging. Part XIV covers insurance as the backstop that makes the whole structure work or fail, and Part XV is the verification list.

Force Majeure, Impossibility, and Excuse: A Comprehensive Guide to Contract Performance Under Disruption

Commercial > Contract Risk Allocation | Published 8 October 2023 - Updated 3 June 2026 | UpLaw - uplaw.us

In brief. Every commercial contract answers one question in a dozen places: who bears this risk? Force majeure, impracticability, indemnity, limitation of liability, liquidated damages, conditions, and insurance are all answers to it. Read them together or you will misprice the deal. The most common drafting failure is not a bad clause — it is two good clauses that contradict each other.

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