This clause relieves a party from liability for damages caused by natural disasters—earthquakes, floods, hurricanes, tornadoes, tsunamis, and similar acts of nature that are beyond human control. When a natural disaster prevents a party from performing (such as a manufacturer whose facility is destroyed by an earthquake), this clause prevents the non-performing party from being sued for breach of contract or consequential damages. The clause protects both parties by acknowledging that some events are genuinely unforeseeable and unpreventable, making it fundamentally unfair to hold someone liable for failure to perform the impossible. This is particularly important in liability contexts because natural disasters can cause catastrophic damages, and without this protection, a party could face ruinous liability for events entirely outside their control.
However, the clause's scope matters enormously. Does it excuse only the directly affected party, or does it allow a supplier to avoid liability even if they had alternative facilities elsewhere? Does it cover only the moment of the disaster, or does it extend through the entire recovery period? Does it apply to all contract obligations or only to performance obligations? A vague natural disaster clause might excuse a party for months of non-performance when they could have resumed operations in weeks, or it might excuse one party while leaving the other party still obligated to perform, creating an unfair one-sided result.
Draft this clause with geographic and temporal specificity. Identify which facilities, locations, or assets are covered by the force majeure protection—for example, "the primary manufacturing facility located at [address]" rather than "any facility." Include a time limit for how long non-performance is excused (e.g., "up to 90 days, after which the non-performing party must resume operations or terminate the contract"). Require the affected party to provide prompt notice and demonstrate that the disaster directly prevented performance at that specific location. Add language requiring the party to mitigate by using alternative facilities, suppliers, or methods if reasonably available. Consider whether the clause should include a termination right if performance cannot resume within the specified timeframe, allowing the other party to seek alternative suppliers rather than remaining indefinitely suspended.
Frequently Asked Questions
What does this clause mean in simple terms?
This clause relieves a party from liability for damages caused by natural disasters—earthquakes, floods, hurricanes, tornadoes, tsunamis, and similar acts of nature that are beyond human control. When a natural disaster prevents a party from performing (such as a manufacturer whose facility is destroyed by an earthquake), this clause prevents the non-performing party from being sued for breach of contract or consequential damages.
Why should I care about this clause?
The clause protects both parties by acknowledging that some events are genuinely unforeseeable and unpreventable, making it fundamentally unfair to hold someone liable for failure to perform the impossible. This is particularly important in liability contexts because natural disasters can cause catastrophic damages, and without this protection, a party could face ruinous liability for events entirely outside their control.
What are my options?
However, the clause's scope matters enormously. Does it excuse only the directly affected party, or does it allow a supplier to avoid liability even if they had alternative facilities elsewhere?
How does this affect small businesses?
Does it cover only the moment of the disaster, or does it extend through the entire recovery period? Does it apply to all contract obligations or only to performance obligations?