In light of the multiple weather events in Ireland since the start of 2025, force majeure provisions are warranting increased consideration in construction contracting.
In construction contracts, force majeure provisions are put in place to allow a party to be relieved of its obligations following the occurrence of an event that is unforeseeable, exceptional or beyond the control of contracting parties.
Force majeure in contracts
Force majeure has no legal meaning in common law. This means that it can be only claimed as a specific contractual right and cannot be implied into a contract as a matter of law. If a contract does not specifically include a force majeure clause, relief for force majeure cannot be claimed.
Where there is no force majeure clause in a contract, other contractual reliefs may be available to the parties, such as a variation, a change in law or suspension.
Force majeure events
The precise definition of force majeure will vary from contract to contract, but it is essentially the occurrence of an event beyond a party’s control. A force majeure clause will generally relieve the affected party of its obligations under a contract on the occurrence of an event which:
- is unforeseeable - usually an element of reasonableness is required;
- is outside the control of the party seeking to rely on the event of force majeure; and / or
- prevents / hinders / delays the works.
Not all of the above criteria will need to be satisfied but they are typical of what we usually see in contracts.
Often contracts will list examples of what may constitute an event of force majeure, such as war, terrorism, disease and extreme weather events.
On occasion, force majeure is included in a contract but not defined. For example, the delay events listed in the standard form The Royal Institute of the Architects of Ireland (“RIAI”) 2017 Building Contract includes where “the Works be delayed by force majeure”[1]. The Joint Contracts Tribunal suite of contracts take a similar approach.
It is difficult to state what will happen here, but the contract will be interpreted as a whole and take into account what the parties intended. In the absence of any contractual guidance, there is scope for argument to be made either way regarding the legitimacy (or not) of a claim for an extension of time for force majeure under such contracts. Claims under these types of contracts may lead to disputes between the parties and there is little court guidance to assist in interpreting force majeure.
In Coastal (Bermuda) Petroleum Ltd[2] the English Court of Appeal held that force majeure clauses should be interpreted by reference to the words used by the parties, rather than their general intention.
This decision aligns with the current position around exclusion clauses. As they seek to exclude a defaulting party from liability under a contract, force majeure clauses are exclusion clauses and a court generally interprets such clauses quite strictly. Exclusion clauses have come under scrutiny by the courts and statute. The current position is that for such a clause to be valid and enforceable it must meet the following criteria:
(i) the clause must be properly incorporated into the contract between the parties (i.e. contained in a signed contract); and
(ii) the clause, on its drafting, must exclude or limit the liability that has arisen.
Prevention
In some contracts, a force majeure clause may only be triggered when a party is prevented from fulfilling its contractual obligations. In the New Engineering Contract (“NEC”) suite of contracts, clause 60.1(19) states that a contractor may be entitled to a compensation event if an event occurs which “…neither Party could prevent…”.
It appears from case law that a party seeking to rely on clauses such as the NEC’s clause 60.1(19) would need to show that performance of its obligations is legally or physically impossible and not just more onerous or unprofitable.
In the UK (which is of persuasive influence), the English courts have decided that only events that prevent, rather than hinder or render more onerous, a contracting party’s performance are true force majeure events as a matter of English law.
In Thames Valley Power Ltd v Total Gas & Power Ltd[3], a force majeure clause in a gas supply contract provided for contractual obligations to be released in the event of inability to perform. Total sought to invoke the clause when gas prices rose dramatically. The High Court held that a force majeure clause will not apply where performance has merely become economically more burdensome, even where it has become dramatically more expensive. To constitute a force majeure event, there would have to be an event that would make Total unable to supply the gas.
The ECJ took a less strict approach in Internationale Handelsgesellschaft v Einfuhr-und-Vorratsstelle[4]. Here the ECJ regarded the concept of force majeure as not limited to cases of absolute impossibility. It said that force majeure could also be understood in the sense of unusual circumstances that were outside the control of the relevant party and the consequences of which, in spite of the exercise of due care, could not be avoided except at the cost of “excessive sacrifice”.
Where a contract requires a party to be prevented from fulfilling its contractual obligations, it cannot invoke force majeure where the obligations under the contract remains physically and legally possible to perform, even if it has become unprofitable or less profitable.
Some clauses may just refer to the obligations being “hindered” or “delayed” and so the threshold may not be as high. In the RIAI standard form contracts, on the occurrence of a delay event clause 30 requires a contractor to use best endeavours to prevent the delay and proceed with the works. While this is quite an onerous provision and requires a financial commitment on the part of the contractor, it does not go as far as the NEC.
Conclusion
The above caselaw highlights how crucial the wording of a force majeure provision is when seeking to rely on its relief. This should be of particular interest to those contracting in the construction industry, as construction projects generally rely on safe weather and road conditions, and thus are especially vulnerable to extreme weather events frustrating their timely completion.
If you wish to discuss in more detail please contact Construction and Engineering partners Rhona Henry and Alison Bearpark, or your usual Matheson contact.
[1] Sub-clause 30(a)
[2] [1993] 1 Lloyd’s Rep. 329
[3] [2005] EWHC 2208
[4] Internationale Handelsgesellschaft v Einfuhr-und-Vorratsstelle fur getreide und Futtermittel (Solange I) (Case 11/70) [1970] ECR 1125