FORCE MAJEURE

What is a force Majeure clause?

Force majeure clauses are contractual clauses which alter parties' obligations and/or liabilities

under a contract when an extraordinary event or circumstance beyond their control prevents

one or all of them from fulfilling those obligations.

Depending on their drafting, such clauses may have a variety of consequences, including:

excusing the affected party from performing the contract in whole or in part; excusing that

party from delay in performance, entitling them to suspend or claim an extension of time for

performance; or giving that party a right to terminate. We talk principally below about parties

being excused from performance entirely, but many of the principles are common to these

different varieties of the clause.

In English and Scots law, force majeure is a creature of contract and not of the general

common law. It, therefore, differs from some other legal systems where force majeure is a

general legal concept and where courts may declare that a particular event, such as a

pandemic like Covid-19, is a force majeure event.

As a result, whether a particular clause relieves a party of contractual liability will, under

English and Scots law, depending on the precise wording used in the clause, the allocation of

risk between the parties provided for by the contract as a whole, the circumstances in which

the parties entered into the contract, and the situation that has arisen. It is for the party

seeking to rely on a force majeure clause in order to excuse its non-performance or late

performance to satisfy a court or other tribunal that this is the effect of the clause.

Is Covid-19 a force majeure event?

Force majeure clauses will generally adopt one of the following approaches to defining the

type of event which may be depending on its impact, relieve a party from contractual liability:

Listing specific events

These may include events such as war, terrorism, earthquakes, hurricanes, acts of

government, plagues or epidemics. Where the term epidemic, or pandemic, has been used,

that will clearly cover Covid-19. An act of government will have occurred where a

government body has imposed travel restrictions, quarantines, or trade embargoes, or has

closed buildings or borders, however, the position is less clear where the government makes

recommendations rather than makes orders using legal powers. Where no relevant event is

specifically mentioned, it is a question of interpretation of the clause whether the parties

intended such an event to be covered. This involves considering whether the list of events

included was intended to be exhaustive or non-exhaustive. Unless specific words are used to

suggest that a list is non-exhaustive, it can be difficult to argue that parties who set out a list

of specific events but did not include a particular event, such as an epidemic, nonetheless

intended that event to be covered.

Setting out broad criteria

Contracts might, for example, refer to events or circumstances "beyond the parties'

reasonable control". Determining whether this covers issues arising from Covid-19 is a

question of interpretation and is fact-specific. In unprecedented circumstances like the

present, the courts are likely to be generous in their interpretation of this sort of wording

when faced with parties who have encountered genuine difficulties in performing. However,

as discussed further below, such parties will still need to show that their non-performance, or

late performance, was truly outside their control and could not have been prevented or

mitigated.

A combination of the above

Clauses may give a list of specific criteria, such as fire, flood, war and so on, alongside wider,

general wording, such as "or any other causes beyond our control". Although all will depend

on interpretation of the particular words used, the general wording in this type of clause will

usually be interpreted broadly, rather than being limited to events that are similar to those

specifically mentioned. As a result, such a clause may still be triggered even if a health event

or other relevant event is not specifically listed.

Force majeure

Sometimes just the phrase "force majeure" itself is used, although this is rare. "Force

majeure" has no technical legal meaning in Scots or English law. Where this term is used, its

meaning will be a matter of contractual interpretation. Standalone references to "force

majeure", without any contractual definition or other relevant contractual wording by

reference to which the term can be interpreted, may well be void for uncertainty. However,

where the wording surrounding the phrase and other contract terms allow, "force majeure"

might potentially be held to cover a range of matters, including legislative or administrative

interference such as embargoes and/or epidemics. Given the almost unprecedented nature of

the Covid-19 outbreak and/or the actions of governments around the world in response, it is

likely that Covid-19 would constitute a force majeure event under many force majeure

clauses. However, as discussed further below, just because a force majeure event has

occurred does not necessarily mean that the parties will be protected from liability for failing

to perform or delay in performance.

Performance is more difficult or expensive now – is that enough?

Even if the Covid-19 pandemic or a related consequence such as government action is a type

of event covered by the force majeure clause in question, the next question to consider is the

impact on the affected party's ability to perform its contractual obligations. It is common for

force majeure clauses to specify the impact that the event or circumstances in question must

have in order for the clause to be triggered. Reference may be made, for example, to the event

or circumstances having "prevented", "hindered" or "delayed" performance. These terms

require different levels of impact on performance before a party will be relieved from

liability.

Prevented

"Prevented" means that it must be physically or legally impossible to perform. This is a high

bar. It is not enough that performance is more difficult, more expensive, or less profitable.

Even where the word "prevented" has not specifically been used, the courts have interpreted

force majeure clauses as only applying where performance is impossible in circumstances

where such clauses state that a party is to be excused on the occurrence of causes beyond

their control, and where a contract provided for delivery "unforeseen contingencies

excepted". Similarly, it is common to see wording such as "unable to perform" and this is

likely to be treated in a similar fashion by the courts.

Hindered

"Hindered" – or "impeded", "impaired" or "interfered with") is a lesser standard and may in

appropriate circumstances be triggered by performance being made substantially more

difficult. For example, a shortage of raw materials caused by a force majeure event may

hinder the performance of a manufacturing contract if those materials can be obtained at a

higher cost but performance would mean breaking other contracts. However, the fact that

performing would simply be less profitable due to higher costs, for example in sourcing

alternative supplies of materials or labour, is generally unlikely to be sufficient to absolve the

party in question of liability to perform.

Delayed

Proving that performance has been "delayed" should be less onerous than proving it is legally

or physically impossible: it is not necessary to show that obligations have been "impossible"

to perform or "prevented" for a period of time, just that complying as quickly as required

under the contract is substantially more difficult.

What else must be shown?

A party seeking to rely on a force majeure clause must also show that:

the force majeure event was the cause of the inability to perform or delayed performance;

their non-performance was due to circumstances beyond their control; and there were no

reasonable steps that they could have taken to avoid or mitigate the event or its consequences.

As a result, where a party anticipates falling into difficulty with meeting its obligations, for

example due to staff shortages through self-isolation in accordance with government

guidelines or issues with the supply of materials, it is crucial to explore whether alternatives,

such as alternative sources of labour or materials, are reasonably available – including at

higher cost, unless this involves breaching existing contracts.

What is the procedure for relying on the clause?

A business seeking to rely on a force majeure clause must also comply with any procedural

requirements under the contract, such as a requirement to give notice of its intention to rely

on the clause to the other party within particular timescales, including any formalities

required for the service of notices. Some clauses may also require updates to be provided

and/or an express obligation to mitigate.

What is the effect of relying on the clause?

The usual remedy if a force majeure clause is invoked is for one or more of the parties to be

excused from its obligations and/or liability under the contract, without any damages being

payable. Force majeure clauses also sometimes provide for extension of time, suspension of

time, or termination in the event of continued delay or non-performance. A right of

termination could be commercially important, as it may provide leverage to renegotiate

contractual terms.

Some clauses also expressly provide that additional costs incurred due to the inability to

perform or perform on time will be borne by a particular party. If not, then it is likely that

costs will be borne by the party that has incurred them, because there is no contractual

provision to override this.

What if there is no force majeure clause?

Since force majeure is a creature of contract rather than a rule imposed by the general law, if

there is no force majeure clause, an affected party will have to look to other provisions of the

contract for potential routes out of its difficulties. If the contract does not provide any such

routes, it may in certain circumstances be possible to rely on the doctrine of frustration of

contract. However, it is very difficult to show that a contract has been frustrated. Frustration

requires that an unforeseen subsequent event outside the control of the parties has made the

contract impossible to perform, or has transformed performance of the obligations under the

contract into something so radically different from that which the parties intended that it

would be unfair to hold the parties to their obligations. One extreme situation where the

courts have held that a contract was frustrated was when war broke out and the government

banned the works and seized and sold the necessary equipment. As with the test for

"prevention" of performance under force majeure clauses, the fact that performance has been

made more difficult or costly is not enough. In addition, it is questionable whether an

epidemic, or even a pandemic, would be considered to be unforeseeable, given previous

recent epidemics and warnings that further epidemics or pandemics are likely to occur.

However, it might be possible to argue that the extent of the global government enforced

lockdowns was unforeseeable. Frustration may also be commercially undesirable in some

circumstances, since its effect, regardless of the wishes of the parties, is to bring all parties'

obligations under the contract to an end immediately.

Practical steps if seeking to rely on a force majeure clause

Parties seeking to rely on a force majeure clause should follow the following practical steps:

1. Consider in detail the precise wording of the force majeure clause, the contract as a

whole and the circumstances that have arisen. Determining whether performance is

excused by a force majeure clause can be a difficult and highly fact-sensitive exercise,

so early legal advice should be sought.

2. Explore alternative means of performing, reducing delay, or minimising any loss to

the other party. This may require considering alternative suppliers , or alternative

methods of delivery, even if at higher cost.

3. Serve any notices as required under the contract, as soon as possible and in

accordance with the notice provisions. Consider carefully what event or circumstance

you allege constitutes the force majeure event, taking into account the wording of the

clause and the timescales required for service of notice: the outbreak of Covid-19

itself, or subsequent government restrictions put in place.

4. Do not attempt to rely on increased costs to excuse non?performance or delay, as

this will not usually be sufficient.

5. Keep a documentary record , particularly of: why performance was impossible,

hindered or delayed as the case may be; the steps taken to find alternatives and

mitigate loss; and the service of any notices.

6. If there is no force majeure clause, consider frustration, but be aware of the high bar

for establishing that a contract has been frustrated.

7. Consider other routes and remedies , either under the contract or through agreeing

binding variations to contracts with other parties.

Anticipate and Specify Force Majeure Events

Determining which types of circumstances will be covered by the force majeure clause is

essential. Provisions often cover natural disasters like hurricanes, floods, earthquakes, and

weather disturbances sometimes referred to as "acts of God."

Other covered events may include war, terrorism or threats of terrorism, civil disorder, labour

strikes or disruptions, fire, disease or medical epidemics or outbreaks, and curtailment of

transportation facilities preventing or delaying attendance by at least twenty-five percent of

meeting participants.

Courts tend to interpret force majeure clauses narrowly ; that is, only the events listed and

events similar to those listed will be covered.

For example , while acts of terrorism might be a specified force majeure event, it does not

necessarily follow that a court would also excuse a party's performance based on "threats" of

terrorism. Thus, it is especially important to specify any types of circumstances that you

anticipate could prevent or impede your meeting from being held.

To the extent possible, take into consideration the location of the meeting and any special

needs or responsibilities of your organization and the meeting participants. What types of

weather-related incidents are common for the meeting location?

If there are major disruptions to transportation systems, will your participants be prevented

from attending?

What percentage of reduced attendance would make continuing with the meeting

inadvisable?

Asking and answering these types of questions will help you anticipate and specify the most

critical force majeure events for your meeting. Even so, not all potential events can be

specified or anticipated in the contract. A concluding catch-all phrase should be appended to

the list, such as “and any other events, including emergencies or non-emergencies,” to cover

other unforeseeable events.

Beware of Restrictive Language

It is common to find boilerplate force majeure language in meeting contracts limiting excuse

of the parties' performance obligations only when it would be "impossible" to perform due

to the unexpected circumstances.

Impossibility is a high threshold; many circumstances will make holding a meeting

inadvisable, even though it would still be possible to do so. For greater flexibility, consider

instead excusing performance when it would be "inadvisable, commercially impracticable,

illegal, or impossible" to perform.

Additionally, even if you have negotiated a specified list of force majeure events, be sure to

carefully read the language that comes before and after the list. Language appended after a

comma can significantly alter the scope of the force majeure clause.

For example , adding the words "or any other emergency beyond the parties’ control” to the

end of a list of specified force majeure events serves to narrow the scope of triggering events

only to “emergencies.” With such language, non-emergency circumstances making it

inadvisable to hold a meeting would not be covered.

Consider Excusing Underperformance Due to Force Majeure

Although a force majeure clause should always allow for complete cancellation of a meeting

without penalty, cancellation will not always be the meeting planner's preferred course of

action.

There may be circumstances in which going ahead with the meeting is preferred, despite the

fact that the force majeure event will likely result in lower-than-expected attendance.

However, groups that fail to meet minimum room or food and beverage commitments will

often risk incurring significant attrition fees. To help make going-forward a viable option in

such circumstances, the force majeure clause should be drafted to excuse liability associated

not just with non-performance (i.e. cancellation) but also with underperformance (i.e. failure

to meet minimum guarantees).

A carefully negotiated force majeure clause is an important tool for reducing the risk of

liability associated with cancelling or scaling back a planned meeting in response to a

disaster.

When significant resources are on the line, meeting planners should consider seeking advice

of legal counsel prior to signing contracts and should also consider obtaining meeting

insurance. Taking appropriate precautions at the outset can provide reassurance that, even in

the worst of circumstances, you will have the flexibility to make the best decision for your

meeting.

COVID 19 – Performance of agreements in India

1. On March 11, 2020[1], the World Health Organization (“WHO”) characterized the

COVID-19 virus as a ‘pandemic’. On the same day, the Government of India issued [2] a

Revised Travel Advisory inter alia suspending all existing visas (except diplomatic, o icial,

UN/ International Organisations, employment, project visas) till April 15, 2020. The

COVID-19 has, in the past couple of months spread across the globe. Similar restrictions

have also been imposed by various other countries to protect its citizens from the virus, which

has already claimed many lives and is still spreading and infecting people all across. In

addition to the major impact on human life and health, the present situation also impacts

businesses and transactions all across the globe as it has potentially given rise to various

contractual disputes. This article aims to explain the legal perspective behind this evolving

impact of COVID-19.

The Outbreak

2. On December 31, 2019, WHO – China Country O ice was informed of cases of

pneumonia of unknown etiology (unknown cause) detected in Wuhan City, Hubei Province

of China. [3] On February 11, 2020, the WHO named the disease ‘COVID-19’, short for

“coronavirus disease 2019.” [4] By March 9, 2020 the above figures of confirmed cases had

increased to

109,577 confirmed cases globally in at least 106 countries/ territories/ vessels (including 43

cases in India) with China continuing to be the most infected country, with 80,904 confirmed

cases. [5]

3. The reasons for the quick and widespread impact of COVID-19 across countries may be

associated with (a) its source of transmission (person-to-person within 6 feet or through

respiratory droplets produced when an infected person coughs or sneezes); (b) the limited

knowledge about COVID-19; (c) no identified cure for the same; and (d) travel and

interaction across the globe. In such circumstances, governments across the globe have taken

various steps to protect its citizens from the outbreak, including as identified above. Some of

the primary steps taken which may have an impact on business include [6],

i. Restrictions on travel to countries where confirmed cases of COVID-19 have been

identified;

ii. Restrictions on travel into the country from countries where confirmed cases of COVID-19

have been identified or where

travel history of individual indicates recent travel to such countries;

iii. Checks and balances to restrict movement of individuals showing early signs/ symptoms

of probable infection; and

Impact on Business

4. The COVID-19 is first and foremost a human tragedy . The virus has already infected

hundreds of thousands of individuals and has claimed close to 4000 lives across the globe [7].

With no confirmed cure in sight, it is difficult to identify the extent of impact COVID-19 is

going to have on human life in the coming months.

5. As indicated above, in light of the global outbreak of COVID-19, a number of

governments have either imposed lockdowns, restricting local movement within regions

which have been significantly affected (such as China and Italy [8]). Further, numerous

countries have implemented travel bans and restrictions on entry of foreign nationals. These

have substantially impacted the capacity to ship goods by air (though the impact on surface

shipment is yet to be assessed).

6. McKinsey & Company, in a study [9], has also identified global economic slowdown as an

impact of the COVID-19. According to the study, the outbreak may result in a significant fall

in the global Gross Domestic Product (“GDP”) and all sectors of industry may be impacted.

While the impact of COVID-19 on business and GDP has only started to manifest itself, the

extent of the same is yet to be completely assessed. There have been similar studies carried

out by various other organisations as well.

7. Today business is truly carried out across boundaries with the advent of technology, ease

of travel and the convenience of communication across countries. Businesses, especially

large-scale and long-term contracts, frequently have cross-border elements in performance.

One impact of COVID-19 (and the consequent restrictions imposed by countries across the

world) on global business that seems to already be causing concerns is the inability/difficulty

being faced by businesses in performance of obligations agreed to in existing agreements.

Covid-19 and Force Majeure

8. The inability/ difficulty being faced by businesses in performing their obligations due to

the outbreak of COVID-19 could have neither been anticipated nor controlled by the

businesses. It is therefore incumbent to analyse as to whether COVID- 19 can be classified as

an event of Force Majeure and if so, what steps ought to be taken by businesses to protect

their interests.

9. ‘Force-Majeure’ is derived from the French language and literally translated means ‘a

superior force’. A ‘force-majeure’ can be defined as “an event or effect that can be neither

anticipated nor controlled; esp., an unexpected event that prevents someone from doing or

completing something that he or she had agreed or officially planned to do. The term includes

both, acts of nature (e.g., floods and hurricanes) and acts of people (e.g., riots, strikes and

wars).” [10] In other words, ‘force majeure’ refers to “events outside the control of the parties

and which prevent one or both of the parties from performing their contractual obligations.”

[11]

10. It may be pertinent to note that the concept of ‘force-majeure’ may be considered

differently under civil law and common law. In most civil law countries (such as China,

France, etc.) the concept of ‘force-majeure’ is codified. Therefore, a specific provision for

‘force-majeure’ may not be required in agreements governed by laws of such countries. In

other jurisdictions such as the United States, courts are known to look at various elements

(such as Whether the contract

contains an applicable force-majeure clause? [12]; Was the force-majeure foreseeable?[13];

Was performance rendered impossible?[14]; Was the impossibility relatable to the

force-majeure event?[15]; etc.) when considering a claim of ‘force-majeure’. In most

common law countries (such as India, England, etc.), the concept of ‘force-majeure’ is not

codified [16] and

is introduced by way of contract, i.e., provided for in the agreement between parties. It is

therefore important to first identify as to which law is applicable to a particular commercial

understanding between parties.

11. In Indian context, most long-term contracts or contracts with continuous obligation of

supply, generally contain a ‘force-majeure’ clause. The purpose behind inserting such a

clause in a contract is to save the performing party from the consequences of anything over

which the party has not control [17]. Such a clause generally identifies the events which may

lead to situations outside the control of parties, which, if found to prevent or delay

performance of obligations by any or all parties, may be excused. Further, continued

‘force-majeure’ event impacting performance of the contract may also lead to termination.

Additionally, such a clause generally also provides the actions to be taken by an affected

party in the event a ‘force-majeure’ clause is triggered.

12. “Force majeure” is governed by the Indian Contract Act, 1872 (“Contract Act”). In so far

as it is relatable to an express or implied clause in a contract, it is governed by Chapter III

dealing with the contingent contracts, and more particularly, Section 32 thereof. [18] Section

32 of the Contract Act provides for “Enforcement of Contracts contingent on an event

happening”.

13. It may be pertinent to note that courts have generally construed ‘force-majeure’ clauses

narrowly [19]. Accordingly, unless a particular event may clearly fall within the ambit and

scope of a ‘force-majeure’ clause, courts may not accept such event as triggering

consequences of ‘force-majeure’. The primary focus, while interpreting such clauses, ought

to be on whether the clause encompasses the type of event a contractual party claims is

causing its non-performance [20].

14. A standard ‘force majeure’ clause [21] in vogue in public procurement contracts of the

Government of India generally includes natural force majeure events. One such example is,

“Act of God, including but not limited to lightning, drought, fire and explosion, chemical or

radioactive contamination or ionising radiation (to the extent of the fire, explosion, chemical

or radioactive contamination or ionizing radiation originate from a source external to the

Power Station Land), epidemic, earthquake, volcanic eruption, landslide, flood, cyclone,

typhoon, tornado, or exceptionally adverse weather conditions which are in excess of the

statistical measures for the last hundred (100) years”. (emphasis supplied) It is thus clear that

a ‘force-majeure’ event, as provided for in standard agreements, generally include natural

events such

as ‘Act of God’ which may be extended to capture a pandemic or an epidemic. An ‘epidemic’

has been defined [22] as “spreading widely, generally prevailing, affecting great numbers”.

An epidemic disease is one of which “the cause acts upon a large number at the same time by

reason of its wide diffusion”. Various States in India such as Karnataka, Haryana and the

National Capital Territory of Delhi have already declared COVID-19 as an ‘epidemic’.

15. It may be pertinent to note that the Government of India believes that the spread of

COVID-19 falls within the definition of ‘Act of God’ as a ‘natural calamity’ . The

Government of India has clarified [23] that for the purposes of considering disruption of the

supply chains due to spread of COVID-19, in China and other countries, this may be

considered as ‘natural calamity’ and force-majeure clauses may accordingly be invoked. A

‘calamity’ has been defined [24] as a “disastrous event” .

16. While the guidance may not be universally applicable as law, it may still have persuasive

strength in interpreting contracts with the Government of India, which are based on common

procurement guidelines. Such an observation may be considered a possible tool for

interpretation on the grounds of contemporanea exposito. However, the acceptance of such an

argument is yet to be tested.

17. It may thus be open for one to argue that impact of COVID-19 on the ability of a party to

perform its obligations under a contract may be covered as a ‘force-majeure’ event. In

addition to being identified as a ‘force majeure’ event, courts may also require showing that

the party attempted to perform the contract regardless of the event, perhaps by finding an

alternative source of supply [25].

Covid-19 and Frustration

18. The law in India with respect to ‘frustration of contracts’ has been laid down in Section

56 of the Contract Act. The leading judgments with respect to ‘frustration’ are Satyabrata

Ghose v. Mugneeram Bangur & Co.[26], where the Hon’ble Supreme Court has adverted to

the second paragraph of Section 56 and Energy Watchdog Vs. Central Electricity Regulatory

Commission & Ors[27] where the Hon’ble Supreme Court considered Section 56 in the

context of long-term contracts. In Energy Watchdog, the Supreme Court stated, “What was

held was that the word “impossible” has not been used in the Section in the sense of physical

or literal

impossibility. The performance of an act may not be literally impossible, but it may be

impracticable and useless from the point of view of the object and purpose of the parties. If

an untoward event or change of circumstance totally upsets the very foundation upon which

the parties entered their agreement, it can be said that the promisor finds it impossible to do

the act which he had promised to do. It was further held that where the Court finds that the

contract itself either impliedly or expressly contains a term, according to which performance

would stand discharged under certain circumstances, the dissolution of the contract would

take place under the terms of the contract itself and such cases would be dealt with Under

Section 32 of the Act. If, however, frustration is to take place de hors the contract, it will be

governed by Section 56.”

19. In situations where an agreement does not provide for ‘force-majeure’ or one does not fall

within the ‘force-majeure’ clause, a party may have to look beyond the clause. In such a

situation, one may consider invoking Section 56 of the Contract Act. However, in such a

case, one would have to show that the event, i.e., COVID-19, has changed the circumstances

totally, to upset the very foundation of the agreement, thereby rendering it ‘impossible’ to

perform. It may be noted that mere economic difficulty or ‘loss’ may not be sufficient basis

to trigger Section 56 of the Contract Act. Parties in such cases may not be excused from

performing their rights.

Things to Remember

20. COVID-19 is pandemic that has surfaced approximately two months back (December

2019). Its outbreak has already started impacting businesses all across the world. However,

we are yet to see the full extent of its spread (as little success has been achieved in curbing

the outbreak or finding a cure) and the impact it will cause on the ability of parties to perform

their obligations.

21. China, where the virus had first surfaced and where the impact of the virus has been seen

the most, has curbed

international business and reduced exports. News Reports [28] indicate that China has

already issued thousands of ‘force-majeure’ notices. A trickle-down effect on agreements

across the globe may be inevitable.

22. India itself carries on significant trade with China and China as its second largest trading

partner. China, as also other primary trade destinations for India, have already been hit by

COVID-19 and have taken drastic measures to protect its citizens against the virus.

23. In such circumstances, instances where need arises to invoke the ‘force-majeure’ clause in

contracts or seek protection under Section 56 of the Contract Act, may arise. While doing so,

it is imperative that parties abide by the terms of the agreement and the requirements of the

‘force-majeure’ clause. The affected party should act promptly in notifying the contracting

party regarding trigger of force majeure in terms of the contract. In such notification, the

affected party should provide the requisite details required in terms of the agreement.

Additionally, it may be advisable to ensure that the impact of COVID-19 on the ability to

perform the obligations under the agreement are clearly identified and all efforts are taken to

mitigate the loss/ damage/ delay caused in performing the obligations.

24. It is imperative that businesses and parties be mindful of the developments to protect their

arrangements from the global-economic slowdown that may be difficult to avoid in the

present scenario.

Footnotes:

[1] Extract from the Opening Remarks by the Director General, WHO, at the Media Briefing

on March 11, 2020, as uploaded on the official web-site of the WHO –

https://www.who.int/dg/speeches/detail/who-director-general-s-opening-remarks-atthemedia-

briefing-on-covid-19—11-march-2020

[2] Revised Travel Advisory Issued by the Government of India on March 11, 2020 after

review of current status by High level Group of Ministers

[3] World Health Organization Novel Coronavirus (2019-nCoV) Situation Report – 1, dated

January 21, 2020

[4] World Health Organization Novel Coronavirus (2019-nCoV) Situation Report – 22, dated

February 11, 2020

[5] World Health Organization Novel Coronavirus (COVID-19) Situation Report – 49, dated

March 9, 2020

[6] Consolidated Travel Advisory – COVID-19 dated March 6, 2020 issued by the Ministry

of Health and Family Welfare; Advisory issued by the Ministry of Home A airs, Government

of India on its official web-site –

https://boi.gov.in/content/advisory-travel-and-visa-restrictions-related-covid-19 Also see,

Advisories issued by various departments of the Government of India as also advisories

issued by other countries

[7] Ibid

[8] Chengdu and Chongqing have imposed local movement lockdowns. Further, Lombardi

(in northern Italy) has also been quarantined. Whereas travel restrictions have also been

imposed across Italy.

[9] Coronavirus COVID 19: Facts and Insights (Updated: March 9, 2020) – Global Health +

Crisis Response, by McKinsey & Company

[10] Black’s Law Dictionary, 11th Edition; @ Pg. 788

[11] P. Ramanatha Aiyar’s Advanced Law Lexicon, 5th Edition; @ Pg. 2077

[12] Corestar Int’l v. LPB Commc’ns, 513 F. Supp. 2d 107, 120, n.8 (D.N.J. 2007); See

Wisconsin Elec. Power Co. v. Union Pac. R. Co., 557 F.3d 504, 507 (7th Cir. 2009) (Posner,

J.); Mitsubishi Int’l Corp. v. Interstate Chem. Corp., No. 08-cv-194, 2008 WL 2139137, at *3

(S.D.N.Y. May 20, 2008)

[13] Watson Labs. v. Rhone-Poulenc Rorer, 178 F. Supp. 2d 1099, 1111–14 (C.D. Cal.

2001). See also TEC Olmos v. ConocoPhillips Co., 555 S.W.3d 176, 183–84 (Tex. App.

2018); but see Perlman v. Pioneer Ltd., 918 F.2d 1244, 1248 (5th Cir. 1990); Sabine Corp. v.

ONG W., Inc., 725 F. Supp. 1157, 1170 (W.D. Okla. 1989).

[14] See Hemlock Semicondutor Corp. v. Kyocera Corp., No. 15-CV-11236, 2016 WL

67596, at *7 (E.D. Mich. Jan. 6, 2016); Great Lakes Gas Transmission Ltd. v. Essar Steel

Minnesota, 871 F. Supp. 2d 843, 852 (D. Minn. 2012).

[15] See, e.g., Gulf Oil Corp. v. F.E.R.C., 706 F.2d 444, 453-55 (3d Cir. 1983); In re Old

Carco, 452 B.R. 100, 119–20 (Bankr. S.D.N.Y. 2011).

[16] While Indian la provides for frustration of contracts under Section 56 of the Indian

Contract Act, 1872, the same is distinguishable from ‘force-majeure’

[17] David Contractors Ltd. Vs. Fareham Urban District Counsel; (1956) 2 AllER 145

[18] Energy Watchdog Vs. Central Electricity Regulatory Commission & Ors., (2017) 14

SCC 80

[19] Ibid; Also see – Bank Line Ltd. Vs. Arthur Capel & Co, (1919) A.C. 435; Kel Kim

Corp. v. Cent. Mkts., Inc., 70 N.Y.2d 900, 902 (1987) (holding that force majeure defense is

narrow and excuses nonperformance “only if the force majeure clause specifically includes

the event that actually prevents a party’s performance”).

[20] See RICHARD A. LORD, 30 WILLISTON ON CONTRACTS § 77:31 (4th Ed.)

(“What types of events constitute force majeure depend on the specific language included in

the clause itself.”)

[21] Draft Standard Power Purchase Agreement as provided by the Ministry of Power, Union

of India on its official website https://powermin.nic.in/en/node/5167 While there may be

other force-majeure clauses which may not specifically provide for terms such as ‘epidemic’

or ‘natural calamity’ used in it and only provide for ‘act of god’. Such clauses would have to

be scrutinized and examined to understand the scope and extent.

[22] P. Ramanatha Aiyar’s Advanced Law Lexicon, 5th Edition; @ Pg. 1789

[23] O ice Memorandum No. F. 18/4/2020-PPD, dated February 19, 2020 of the Government

of India, Ministry of Finance, Department of Expenditure, Procurement Policy Division

[24] P. Ramanatha Aiyar’s Advanced Law Lexicon, 5th Edition; @ Pg. 707

[25] Gulf Oil Corp. v. F.E.R.C., 706 F.2d 444, 452 (3d Cir. 1983)

[26] 1954 SCR 310

[27] Supra Note 12

[28]

https://www.cnbc.com/2020/03/06/coronavirus-impact-china-invokes-force-majeure-to-prote

ct-businesses.html ; https://www.xinhuanet.com/english/2020-02/17/c_138791495.htm;