Exploring Foreseeability and Force Majeure in Israel
The COVID-19 pandemic disrupted our day-to-day lives both here in Israel and globally, further demonstrating a phrase you may have heard quite often: “Force Majeure”. For those not fluent in legalese, its meaning may not be immediately obvious -- but we are here to explain.
Force Majeure is a concept in Contract Law that refers to situations in which one party in an Agreement is unable to perform part or all its obligations because of a situation beyond its control. In the case of Force Majeure, said party is not liable for the failure to fulfill its obligations in accordance with the Agreement. Instead, the party is entitled to suspend or is excused from performing the obligations.
You may have heard references to this concept with phrases like “Acts of G-d” to address floods, droughts, earthquakes, and natural disasters. However, the concept of Force Majeure is broader and many such clauses include events such as terror attacks, armed conflicts, actions taken by governments or public authorities, accidents, labor disputes, and pandemic diseases such as COVID-19.
Not all exigent circumstances qualify for the contractual defense of Force Majeure. However, certain dire circumstances that are unforeseen, lack preventability, and that the breaching party was unaware of at the execution of the Agreement may make the contractual obligations impossible for the breaching party to fulfill. The Israeli Court is very strict, and a heavy burden of proof exists for the Plaintiff when trying to assert Force Majeure as a defense to nullify a contract or delay the performance of contractual obligations.
Further, the Israeli government applies the Force Majeure doctrine more tightly to certain events than others. For example, because of the frequent occurrences of terrorism in Israel, the Israeli government offers limited Force Majeure protection for terror-related acts. Inherent foreseeability of certain events varies in different countries, and Aviv Lazar&Co offers exemplary advice on which circumstances may qualify under the doctrine of Force Majeure in your country.
In order to prevent future issues from arising, you should add a Force Majeure provision into contracts. This clause should delineate which contracting party or parties, if any, are still liable for fulfilling their contractual obligations in the case of unforeseeable circumstances. The terms of the Force Majeure clause should be written in a clear, concise manner and consulting an experienced attorney may be beneficial for you and your company to ensure that all relevant triggers for Force Majeure are incorporated. Here at Aviv Lazar&Co, we provide legal services explaining how you might activate a Force Majeure clause in a specific contract and can further help you draft your own Force Majeure clause tailored to the needs of your company.
We will eagerly help guide you to entrepreneurial success. We tailor our services to accommodate the business needs and provide personalized attention to our clients. Please feel free to contact us today for further consultation so we can take the next step toward limiting your liability in the occurrence of unforeseen, unpreventable circumstances.