COVID-19 erupted in the United States without much warning. It is a classic case of what companies call a force majeure event, meaning an unforeseeable circumstance beyond the control of the company. How do you determine if an event(s) constitutes force majeure?
- An event must be beyond the reasonable control of the company
- An event must have impeded the company’s ability to execute its obligations
- A company should have tried to mitigate the consequences of the event
- A company should try to use a specific example, if possible, of a force majeure event, such as “An act of God”, An act of war”, or some other phrase