Picture this. A flood disrupts your supply chain. A nationwide strike delays performance. A government directive makes it impossible to fulfil contractual obligations. A fire destroys the premises from which a business operates.
The immediate reaction may be: "Surely, this is force majeure."
But is it?
The terms force majeure, frustration, and act of God are often used interchangeably in commercial conversations and, unfortunately, sometimes even in contracts. While these concepts overlap, they are not legally identical. Relying on vague boilerplate language can leave a business exposed precisely when contractual protection is needed most.
At D. Otunga & Associates, we believe a good contract should not merely record an agreement. It should anticipate risk, allocate responsibility, and provide a clear roadmap for what happens when things do not go according to plan.
Force Majeure
Force Majeure: Your Contract Says What Counts
Force majeure, meaning "superior force," generally refers to an event beyond the reasonable control of the contracting parties that prevents, delays, or makes contractual performance impracticable.
Such events may include natural disasters, floods, earthquakes, wars, riots, strikes, epidemics, government restrictions, supply-chain disruptions, or other extraordinary circumstances.
However, there is a crucial point: force majeure is primarily contractual.
Whether a party can rely on force majeure will largely depend on the actual wording of the contract. What events are covered? Must performance be impossible, or is a serious delay enough? How soon must notice be given? Must the affected party take steps to mitigate the consequences? Does the event merely suspend obligations, or can it eventually lead to termination?
A clause that states "Neither party shall be liable for force majeure events" may sound protective. In reality, it may create more questions than answers.
Frustration
Frustration: When the Law Steps In
Frustration is different. It is a legal doctrine that may apply when an unforeseen event after contract formation renders performance impossible, unlawful, or fundamentally different from what the parties originally contemplated.
Unlike force majeure, frustration does not depend entirely on an express contractual clause. It arises by operation of law.
However, the threshold is generally high. A contract does not become frustrated simply because performance has become more expensive, inconvenient, delayed, or commercially unattractive.
This is precisely why businesses should not assume that the doctrine of frustration will rescue them from a poorly drafted agreement. Where risks could have been anticipated and expressly allocated in the contract, relying on frustration after a dispute arises may be an uncertain and costly strategy.
Act of God
An Act of God: Nature, Not Every Unforeseen Event
An act of God traditionally refers to an overwhelming and unavoidable event caused exclusively by natural forces, such as an earthquake, an exceptional flood, a hurricane, or a tornado.
This makes it narrower than force majeure.
While force majeure may encompass both natural events and human-caused disruptions such as strikes, riots, wars, or government action, an act of God is generally confined to exceptional natural phenomena that could not reasonably have been prevented or avoided through due care and foresight.
The distinction matters. A contract that makes reference to only acts of God may fail to protect parties from civil unrest, industrial action, political disruption, cyber incidents, or government restrictions.
Three words can therefore make the difference between contractual protection and expensive exposure.
The Real Risk
The Real Risk Is Ambiguity
Consider a supplier whose contract states that performance may be excused due to "force majeure or circumstances beyond the party's control."
What exactly does that mean?
Does it cover a shortage of raw materials? A transport strike? A cyberattack? Failure by a subcontractor? A government ban? A prolonged power outage? What if performance is still technically possible but has become dramatically more expensive?
Without precise drafting, both parties may interpret the same clause differently. And once that happens, what began as a drafting problem can quickly become a commercial dispute.
The uncomfortable truth is simple: ambiguity is rarely harmless. Someone usually pays for it.
Drafting Guidance
What Should a Well-Drafted Force Majeure Clause Address?
A commercially sound clause should be tailored to the transaction rather than copied blindly from a generic template. Depending on the nature of the agreement, it should clearly address:
Specific events
List the qualifying events – natural disasters, strikes, government action, etc.
Exhaustive or illustrative
Clarify whether the list is exhaustive (closed) or illustrative (open to similar events).
Impact required
Define the threshold: prevention, delay, impracticability, or material adverse effect.
Notice requirements
Set clear timelines and procedures for giving notice of the event.
Mitigation obligation
Does the affected party have a duty to mitigate the consequences?
Suspension vs termination
Specify whether obligations are suspended or if the clause can lead to termination.
Cost allocation
Who bears the costs arising during the disruption period?
Prolonged force majeure
Set a time limit after which either party may terminate the agreement.
Termination rights
Define the circumstances under which either party may walk away.
The right clause for a construction contract may be entirely unsuitable for a technology services agreement. A supply contract, lease, employment-related agreement, shareholder agreement, and cross-border commercial transaction each carries different risks.
Copy-and-paste contracts are cheap, until they become expensive.
Long-term thinking
Contracts Should Be Drafted for the Bad Days Too
The objective is not to predict every possible disaster. That would be impossible. The objective is to create sufficient clarity, flexibility, and risk allocation so that an unexpected event does not automatically become an expensive legal crisis.
Final Take
Don't Let Ambiguity Become Your Biggest Contractual Risk
At D. Otunga & Associates, we assist businesses, SMEs, entrepreneurs, organizations, and individuals with drafting, reviewing, and negotiating clear, commercially practical, and risk-conscious contracts.
We do not believe contracts should merely sound legal. They should work.
Whether you are entering into a supply agreement, service contract, partnership arrangement, commercial lease, consultancy agreement, or another commercial transaction, careful drafting can help identify risks before they become disputes.
Before you sign, ask yourself: Does your contract clearly explain what happens when the unexpected happens?
If the answer is "I think so," that may be exactly the ambiguity you need to address.
Disclaimer
D. Otunga & Associates
Clear contracts. Better risk allocation. Stronger business relationships.
This article is intended for general informational purposes only and does not constitute legal advice. Legal advice should be sought based on the specific facts and circumstances of each matter.