January 2020 saw the global outbreak of the coronavirus (“COVID-19”). The rapid spread of COVID-19 has caused worldwide fear and anxiety which in turn is having a significant impact on the global economy as it increasingly disrupts production, supply chains and travelling. With the disruption of COVID-19 in mind, businesses have to consider how to contractually protect themselves, with one such option the use of force majeure.

What is force majeure?

Force majeure, under international contract law, refers to a situation where performance becomes impossible due to a superior force and/or an unforeseeable event outside the control of either party to the contract. These unforeseeable events are called force majeure and/or acts of God, and often includes, storms, floods, strike, acts of war, terrorism, epidemics and pandemics or any change in law or order or any circumstances arising.

With the focus placed on commercial contracts, a force majeure clause is often included to release the parties to the contract of their obligations and to relieve them of any loss or damage to the extent that the non-performance is due to any force majeure event.

Can force majeure be triggered as a result of COVID-19?

In the event that an agreement contains a force majeure clause regulating the consequences of such event, one must consider the contractual wording in order to ascertain whether a force majeure clause can be triggered as a result of COVID-19. It is important to note that the provisions of the agreement will take precedence over those in the common law. Firstly, the force majeure clauses must be detailed and specifically list the force majeure events that both the parties agree will suspend their performance and obligations. Secondly, the force majeure event must not have been a possibility when the contract was entered into by the parties. The party triggering the force majeure clause will also have to prove that its non-performance is not just a failure to perform but that it was occasioned due to COVID-19, that such event was outside of its control, and that all reasonable steps were taken and no alternative means for performing its obligations exist.

However, should the agreement contain no force majeure clause to regulate the consequences of such an event, we turn to South African case law, and more specifically the Peters, Flamman & Co v Kokstad Municipality 1919 AD 427 case, in which Solomon JA held that legislation making performance objectively impossible or illegal will constitute a force majeure and as a result the agreement should therefore be terminated. This is known as the common law principle of

supervening impossibility of performance’. What this all means is that if it becomes objectively impossible or illegal for either party to perform its obligations under an agreement, that party may not be held liable for such non-performance. The party seeking to rely on the supervening impossibility of performance principle must however show that the performance is objectively impossible or illegal and not just difficult, burdensome or economically onerous.


In Hersman v Shapiro & Co 1926 TPD 367, Stratford J held: “Therefore, the rule that I propose to apply in the present case is the general rule that impossibility of performance does in general excuse the performance of a contract, but does not do so in all cases, and that we must look to the nature of the contract, the relation of the parties, the circumstances of the case, and the nature of the impossibility invoked by the defendant, to see whether that general rule ought, in the particular circumstances of the case, to be applied.”

It’s clear that the declaration of force majeure must be considered on a case by case basis. Businesses affected by COVID-19 are advised to review their contractual agreements, or seek legal guidance where there is uncertainty, to ascertain whether a force majeure clause is applicable, and should it be, carefully consider the implications of invoking it. If, upon review of their contractual agreements, these businesses find that no provision has been made for the inclusion of a force majeure clause, this COVID-19 pandemic acts as a prime example of why future agreements should always include such a clause.


Published: 07 May 2020