legal definition of force majeure?----any legal experts here

[lenten]

i thought that if force majeure was written into a contract then either party could use it as a reason to withdraw from contract--------willing to be educated

 

[newtothis]

If you really want chapter and verse, sign up to listen to a recording of this webinar from this morning. Applies to commercial shipping, but from c.25 minutes in there's a section on the legal implications of coronavirus, use of force majeure etc.
The short answer is: if it were that easy there wouldn't be contract lawyers.

Event Registration

 

[Irish Rover]

I'd say there are more definitions of FM knocking around than there are opinions about the best anchors to use.

 

[Leighb]

There is also legal advice on the RYA website.

 

[dom]

Lenten, force majeure within the context of English Law is a tricky legal concept with limited case law. It is sometimes invoked in the finance world during corporate M&A activity, but the ensuing disputes often require a court to resolve them.

I'm not a lawyer but as one hasn't yet tipped up, I would imagine such a dispute would only be worth pursuing either as a Class Action (also complex legally) or if a considerable sum is involved. Perhaps not relevant, but in the finance world the costs seem to exceed £500k soon after one presses go!

Prob best to therefore try to negotiate something sensible.

You could try this link to get the general gist of things:
Will Covid-19 trigger a force majeure clause?

 

[Sybarite]

i thought that if force majeure was written into a contract then either party could use it as a reason to withdraw from contract--------willing to be educated

It means that if there is some external situation which prevents you from fulfilling your side of the contract then you cannot be held to it.

 

[Fr J Hackett]

For force majeure to apply in a contract the terms that it covers need to be specified.

 

[CAPTAIN FANTASTIC]

The force majeure clause must be included in the agreement and must refer to any financial circumstances; the court must be able to see the basis principles of the claim.

 

[photodog]

I think we need to look at “Frustration. “

ive been talking about this a bit, and no one seems to address it... and it does not depend on force majuer as a contractual term...


But for things like leases and contracts, the current situation seems to fit it to the bone...

 

[dom]

The force majeure clause must be included in the agreement and must refer to any financial circumstances; the court must be able to see the basis principles of the claim.

True to an extent, but sometime force majeure is only mentioned without detailed specification and sometimes it just refers to circumstances beyond the control of the party seeking to rely on the clause. This can include acts of government, war, etc. Moreover, outside of UK law force majeure can exist as a general legal concept independent of the contract’s construction.

A lot more dets would be required here to say anything firm.

 

[jonic]

I have had to use it in the past with a boat sale but it was to agree an extended timeframe. It can be tricky and is not straightforward. If both parties can't agree you may need a lawyer to help.

 

[photodog]

Law Reform (Frustrated Contracts) Act 1943

 

[PHN]

i thought that if force majeure was written into a contract then either party could use it as a reason to withdraw from contract--------willing to be educated

Can you please elaborate what was written exactly in what context and in what kind of contract?

 

[lenten]

i was asking ihis question for my daughter who runs a glamping site- for group bookings only-----she is booked up every weekend until october-----her terms and conditions do not mention force majeure--------the normal booking conditions are ---a 30% non refundable deposit at time of booking----70% balance to be paid 3months before arrival---she also advises taking out holiday insurance-----if she is closed and cannot provide her glamping service she will refund the 70% balance----all other camping./glamping/holiday cottages she has looked at seem to be keeping deposits-----as she didn t have business interferance insurance and her customers don t seem to have travel insurance----- she is thinking of sharing the pain with her customers and returning 50% of their deposits-------would this be fair-----would this be legally aceptable

 

[PHN]

There is a lot of information about corona related cancellation cases in the holidays industry and customers having yes or no a right of refund. From what I have read - and I am not an expert - in most cases the travel insurance does not cover this type of cancellation. Following that news it wouldn't have mattered for customers of your daughter if they had yes or no insurance in this particular case.

Also from what I have read a lot of travel agents experience issues with customers not paying the remaining balance for booked holidays and most of them leave it at that without further action out of future business interests.

From your explanation - to put it bluntley - her conditions are that customers lose 30% even if she would decide to have "a bad day" and not open shop for whatever reason. A legal expert can inform you if this would hold up in court, because certain conditions can be deemed illegal.

Following your explanation the terms are that 30% is non refundable and 70% will be refunded when services are not provided. That would mean that her customers are entitled to receive a 70% refund and not 50%.

Regardless the legal implications a more important topic is continuation of the business over the next years. Having a bad reputation will hurt the business and could be more costly than being legally right to keep a certain amount of money. That is a business decision.

From a business perspective talking to your customers to work out a deal that everyone is comfortable with usually works best.

 

[ashtead]

It would seem that performance of the rental has been rendered illegal and so performance has been frustrated by events . If there is an FM clause in contract does it refer to pandemic or say epidemic. If no FM clause appears then if frustrated parties should've restored to pre contract position. Coverage by any insurance turns on policy wording of the insured but as between accommodation provider and renter it makes no difference.

 

[lenten]

sorry PHN----perhaps i didn t make it clear-----the 70% final payment would automatically be returned plus she is thinking of returning half the non refundable 30% deposit-----total 85%----the 15% she keeps for herself will not cover her fixed costs-------she is also offering postponing bookings for up to a year which has had some interest

 

[duncan99210]

Does your daughter pay business rates (or get business rates relief) on her glammping site? If so, she is in line for the covid19 grant, see here COVID-19: support for businesses. That grant should enable her to return all deposits in full if customers don’t want to move the booking to next year. We’re in a not too dissimilar position and are waiting to see if we are eligible for the grant before contacting the relatively few customers we’ve got this year.

 

[Daydream believer]

all other camping./glamping/holiday cottages she has looked at seem to be keeping deposits---

Park Dean have offered my wife a full refund or a voucher for an extra 20% if transfered to next year.
I would have though ( without seeing the terms) that If your daughter cannot provide the service she contracted to supply, then she has broken the contract, regardless of reason, & should repay the full cost. Harsh, but what about the customer. It is not their job to finance her business & they may well need that money back now.

 

[anoccasionalyachtsman]

Bear in mind that there are two sides to this. The customer can't travel to the site and would therefore forfeit the deposit.