Revisiting Force Majeure and Dispute Resolution Clauses in Light of the Recent Outbreak of the Coronavirus

  • John Trenor, Hyun-Soo Lee
  • 2.27.2020

The recent outbreak of the novel coronavirus (COVID-19) has had and continues to have a devastating impact on human health and life around the globe, with significant repercussions for businesses worldwide.

This client alert highlights some of the contractual issues that companies are facing in deciding whether their contracts permit them or their counterparties to declare force majeure to excuse contractual obligations in light of the impact of the growing coronavirus epidemic. Contracting parties’ rights and obligations in this regard are a function of the language of the force majeure clause, the governing law clause, and the dispute resolution procedures agreed in the contract.

Even those companies not yet affected by the coronavirus may benefit from a careful analysis of the interplay of these contractual provisions in their existing and contemplated future contracts to assess their rights if future unexpected events affect the parties’ ability to perform their contractual obligations.

Read the full alert.