Force Majeure in Contracts in South Africa: What You Need to Know.

In the world of contract law, force majeure is an important concept that can help protect parties from the unforeseen and uncontrollable events that can disrupt business operations. In South Africa, force majeure clauses are often included in contracts to help manage risk and mitigate the impact of unexpected events. In this article, we will explore the basics of force majeure in contracts in South Africa, including what it is, how it works, and what businesses need to know to protect themselves.

What is Force Majeure?

Force majeure is a legal term that refers to unforeseeable and unavoidable events that are beyond the control of parties to a contract. A force majeure clause is a common clause in contracts which typically excuses one or both parties from liability or performance of the contract in some way following the occurrence of a force majeure event. Its underlying principle is that on the occurrence of certain events which are outside a party's control, that party is excused from or entitled to suspend performance of all or part of its obligations. That party will not be liable for its failure to perform the obligations, in accordance with the clause.

Examples of force majeure events can include natural disasters, war, strikes and pandemics.

What is Supervening Impossibility?

Supervening impossibility is a common law defence in South African law. You would typically rely upon this common law defence where a contract does not contain a force majeure clause.

How Does Force Majeure Work in South Africa?

In South Africa, force majeure is a recognized concept in contract law. However, force majeure clauses are interpreted strictly by the courts and must be drafted clearly and specifically to be enforceable. The party seeking to rely on a force majeure clause must prove that the event in question was beyond its control and that it has taken reasonable steps to mitigate the impact of the event.

What Businesses Need to Know

To protect themselves from the impact of force majeure events, businesses in South Africa should include force majeure clauses in their contracts. These clauses should be drafted clearly and specifically to cover the types of events that could reasonably be expected to occur.

Businesses should be aware of the limitations of force majeure clauses and the importance of taking steps to mitigate the impact of force majeure events. This may include developing contingency plans, obtaining appropriate insurance coverage, and communicating with other parties to the contract.

Businesses should also take note of supervening impossibility and the potential for it to arise even when a force majeure clause is not included in the contract. In such cases, businesses should take steps to communicate with other parties to the contract and seek legal advice to ensure that they are protected from liability.

Conclusion

Force majeure is an important concept in contract law that can help protect businesses from the unforeseen and uncontrollable events that can disrupt business operations. By including clear and specific force majeure clauses in their contracts, businesses can manage risk and mitigate the impact of unexpected events. With the right approach, businesses can protect themselves from liability and ensure that their contracts are enforceable in the event of a force majeure event.

If you need assistance with a force majeure event, contact our offices today to schedule a consultation with one of our specialist contract law attorneys.