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Post Reply: Navigating Contractual Disruptions: The Case for Implied Force Majeure in Common Law Jurisdictions

<blockquote><div class="quotetitle">Quote from <a class="profile-link highlight-moderator" href="https://lawguide.co.ke/understanding-law/legal-forum/profile/lawyer/">Lawyer</a> on July 14, 2025, 1:00 pm</div><div id="pl-6951"  class="panel-layout" ><div id="pg-6951-0"  class="panel-grid panel-no-style" ><div id="pgc-6951-0-0"  class="panel-grid-cell"  data-weight="1" ><div id="panel-6951-0-0-0" class="so-panel widget widget_sow-editor panel-first-child panel-last-child" data-index="0" data-style="{&quot;background_image_attachment&quot;:false,&quot;background_display&quot;:&quot;tile&quot;,&quot;background_image_size&quot;:&quot;full&quot;,&quot;background_image_opacity&quot;:&quot;100&quot;,&quot;border_thickness&quot;:&quot;1px&quot;}" ><div
			
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	<p dir="ltr">The COVID-19 pandemic, a global crisis that emerged in early 2020, disrupted commercial and contractual relationships on an unprecedented scale. Lockdowns, supply chain failures, and shifting market conditions left many businesses unable to fulfill their contractual obligations through no fault of their own. This situation exposed a critical question in contract law: how should legal systems address the impact of such extraordinary events on contractual performance? In common law jurisdictions like Kenya and South Africa, the absence of explicit contractual provisions for unforeseen events often leaves parties reliant on the rigid doctrine of frustration, which may not adequately address modern global crises. This article explores the distinctions between force majeure and frustration, examines their application in common law jurisdictions, and argues for the adoption of an implied force majeure doctrine to provide equitable relief in exceptional circumstances.</p>
<h2 dir="ltr"><span style="text-decoration: underline;">Understanding Force Majeure and Frustration</span></h2>
<h3 dir="ltr">Force Majeure: A Contractual Mechanism</h3>
<p dir="ltr">Force majeure, originating from the French Civil Code of 1804, is a contractual mechanism designed to allocate risk for extraordinary events beyond the control of the contracting parties. These events, such as natural disasters, pandemics, or government actions, must be explicitly outlined in a contract's force majeure clause to excuse non-performance. The doctrine allows flexibility, enabling parties to suspend or modify obligations when unforeseen events render performance impossible or impracticable. In civil law systems, force majeure often applies as a default statutory principle, but in common law jurisdictions, it requires explicit inclusion in the contract. This contractual nature allows parties to tailor the clause to their specific needs, making it a versatile tool for managing risk.</p>
<h3 dir="ltr">Frustration: A Common Law Doctrine</h3>
<p dir="ltr">In contrast, frustration is a common law doctrine that applies when no force majeure clause exists. Established in the English case of Taylor v. Caldwell (1863), frustration addresses situations where performance becomes objectively impossible or radically different from what was originally contemplated. Unlike force majeure, frustration does not require a contractual provision and operates as a legal safety valve to discharge obligations entirely. However, its application is narrow, requiring three stringent criteria: objective impossibility, no fault of the invoking party, and a fundamental alteration of the contract's purpose. These requirements make frustration a high bar to meet, often leaving parties bound to perform despite significant disruptions.</p>
<h3 dir="ltr">Key Differences</h3>
<p dir="ltr">The primary distinction between force majeure and frustration lies in their flexibility and threshold for invocation. Force majeure clauses can be drafted to cover a range of scenarios, allowing relief when performance is significantly burdensome, not necessarily impossible. Frustration, however, demands that performance be objectively impossible or fundamentally altered, making it less adaptable to situations where performance is merely difficult or commercially impractical. This rigidity poses challenges in addressing modern crises like pandemics, where disruptions are severe but may not meet the strict impossibility standard.</p>
<h2 dir="ltr"><span style="text-decoration: underline;">The Impact of COVID-19 on Contractual Obligations</span></h2>
<p dir="ltr">The COVID-19 pandemic highlighted the limitations of traditional contract law doctrines. Government-mandated lockdowns, supply chain disruptions, and economic downturns rendered many contracts impossible or impractical to perform. Businesses faced financial strain, yet in common law jurisdictions, the absence of force majeure clauses often left them reliant on frustration, which proved inadequate. For instance, economic hardship alone does not satisfy the frustration doctrine's strict criteria, leaving parties obligated to perform despite extraordinary circumstances.</p>
<h2 dir="ltr"><span style="text-decoration: underline;">Case Studies: </span></h2>
<h3 dir="ltr">Kwanza Estates Ltd v. JKUAT</h3>
<p dir="ltr">In the Kenyan case of Kwanza Estates Limited v. Jomo Kenyatta University of Agriculture and Technology (2024), the Supreme Court addressed whether COVID-19 constituted a frustrating event for a commercial lease agreement. The university argued that government-imposed lockdowns and financial strain made it impossible to fulfill its obligations. The Court rejected this argument, emphasizing that frustration requires objective impossibility or a radical change in the contract's nature, not merely economic difficulty. Additionally, the absence of a force majeure clause in the lease agreement meant that no contractual relief was available. This decision underscores the rigidity of frustration in common law jurisdictions and the necessity of explicit force majeure provisions.</p>
<h3 dir="ltr">EDF v. Total Direct Energie</h3>
<p dir="ltr">In contrast, a French case involving Electricité de France (EDF) and Total Direct Energie (TDE) demonstrated the flexibility of civil law systems. TDE invoked force majeure to suspend obligations due to COVID-19, despite the absence of a specific pandemic clause in the contract. The Paris Commercial Court ruled in TDE's favor, recognizing the pandemic as an unforeseen, irresistible event under France's liberal force majeure framework. This ruling highlights how civil law systems can imply force majeure for extraordinary events, offering a more adaptable approach than common law jurisdictions.</p>
<h2 dir="ltr"><span style="text-decoration: underline;">The Case for Implied Force Majeure</span></h2>
<h3 dir="ltr">Addressing Global Crises</h3>
<p dir="ltr">The COVID-19 pandemic exposed the need for a more flexible approach to contractual disruptions in common law jurisdictions. Unlike frustration, which requires objective impossibility, an implied force majeure doctrine would allow courts to excuse performance when extraordinary events, such as pandemics or government restrictions, fundamentally disrupt contracts without rendering them entirely impossible. The pandemic's global impact, characterized by unforeseeable lockdowns and market breakdowns, fits the criteria for force majeure: it was beyond the parties' control, unforeseen at the time of contracting, and significantly disrupted performance.</p>
<h3 dir="ltr">Judicial Flexibility</h3>
<p dir="ltr">Adopting an implied force majeure doctrine would enable courts to balance commercial reality with legal certainty. The strict requirements of frustration often fail to address situations where performance is technically possible but commercially impracticable. Implied force majeure would allow courts to consider the broader context of global crises, providing relief when performance is unreasonably difficult. To ensure fairness and prevent abuse, the doctrine should be applied with clear criteria:</p>
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<p dir="ltr">The event must be unforeseeable at the time of contracting.</p>
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<p dir="ltr">The event must be beyond the control of the affected parties.</p>
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<p dir="ltr">The event must fundamentally disrupt performance, though not necessarily make it impossible.</p>
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<p dir="ltr">These standards maintain contractual integrity while offering equitable relief in exceptional circumstances.</p>
<h3 dir="ltr">Balancing Commercial Reality and Legal Certainty</h3>
<p dir="ltr">Contracts provide predictability and security for commercial relationships, but rigid adherence to their terms during unforeseen crises can lead to unfair outcomes. Implied force majeure offers a balanced solution, allowing courts to modify or suspend obligations when global disruptions make performance impracticable. This approach preserves the sanctity of contracts while acknowledging the realities of modern global challenges, ensuring that businesses are not unfairly penalized for events beyond their control.</p>
<h2 dir="ltr"><span style="text-decoration: underline;">Conclusion</span></h2>
<p dir="ltr">The COVID-19 pandemic revealed significant gaps in common law contract doctrines, particularly in jurisdictions like Kenya and South Africa. The doctrine of frustration, with its high threshold of objective impossibility, is often inadequate for addressing contemporary global crises. In contrast, force majeure provides a more flexible mechanism but is limited by its contractual nature. By adopting an implied force majeure doctrine, common law jurisdictions can offer a fairer, more adaptable solution for extraordinary disruptions. This approach would allow courts to provide relief when unforeseen events fundamentally disrupt performance, balancing commercial reality with legal certainty. As global integration increases the likelihood of unexpected crises, contract law must evolve to remain relevant and equitable, ensuring that businesses can navigate disruptions without undue penalty.</p>
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