Lesson 8

Question 1

What is a force majeure clause?

Answer 1

A contract provision that excuses or suspends a party’s obligations when performance becomes impossible due to unforeseeable events beyond their control.

Question 2

What are common categories of force majeure events?

Answer 2

Natural disasters, war, terrorism, strikes, pandemics, legal bans (e.g., export restrictions), infrastructure breakdowns.

Question 3

What are the typical legal prerequisites for force majeure?

Answer 3

• Impossibility of performance
• Unforeseeability
• No fault in prevention

Question 4

What are the legal remedies under a force majeure clause?

Answer 4

Suspension of obligations, termination of contract, or reallocation of loss depending on the clause wording.

Question 5

What is hardship in contract law?

Answer 5

A situation where performance becomes excessively burdensome (but not impossible), often due to economic changes.

Question 6

How is hardship typically addressed in contracts?

Answer 6

Through clauses that allow for renegotiation, adjustment of terms, or termination if no agreement is reached.

Question 7

What is the difference between force majeure and hardship?

Answer 7

• Force majeure = impossibility of performance.
• Hardship = extreme difficulty or economic imbalance, but performance is still possible.

Question 8

What legal approach does common law take toward force majeure?

Answer 8

It generally does not recognize force majeure unless contractually agreed. The default doctrine is frustration, which is rarely applied.

Question 9

What was the court’s decision in Standard Retail Pvt Ltd v GS Global Corp (India, 2020)?

Answer 9

The buyer could not invoke the force majeure clause because it applied only to the seller, and market collapse due to COVID-19 was insufficient.