By Mark Lazarus -
Snapshot
- Since 2020, the instinct has been to make force majeure clauses longer and more specific. That instinct is misplaced; a force majeure clause allocates risk and allocating the risk of an event is precisely what stops the doctrine of frustration applying to it.
- In return, the clause does little more than suspend performance, and often excludes payment, the one obligation a commercial dispute is ever really about. A doctrine that can end the contract is given up for a clause that merely defers payment.
- These arguments are most often run not by the party directly affected, but by the one beside it: a guarantor or purchaser trying to leave a soured deal. The protection worth having is built at the drafting stage, by stating a principle rather than listing last year’s disasters.
A transport client comes in with a problem that has become familiar by 2026. Their goods once moved through the Red Sea; now the vessels take the long way around the Cape, the freight invoices have doubled and deliveries run weeks late. They want to know whether the force majeure clause in their supply contract releases them or buys some relief. The clause is a recently reviewed one with a long and careful list of events. It does almost nothing for them.
This experience is now common and it runs against the instinct the profession has followed since 2020: to make these clauses more specific with longer lists, more named events, COVID-19 written in by name. Each revision aimed to seal the contract more tightly against the next shock but it had the reverse effect. The more specific the clause became, the more of the common law backstop the client quietly gave away until, at the time of the 2026 disruptions, it is left doing little more than postponing an invoice.
