1. IS THE WAR IN UKRAINE A FORCE MAJEURE EVENT?
A contract party does not incur liability if the non-performance of its contractual obligation is caused by an event of “force majeure” 1. Under general contract law (which may be deviated from in a force majeure clause (question 2)), conditions to invoke force majeure are:
- An extraneous event – The event may not be imputable to the contract party invoking it. The Ukraine war clearly meets this condition.
- An unforeseeable event – The condition of the event being unforeseeable when entering the contract is generally applied in a flexible way. The war in Ukraine should meet this condition with respect to contracts entered into before the Russian invasion.
- Impossible performance – The event must prevent the performance of the obligation of the contract party invoking force majeure.
Even if one may expect that case-law will use the flexible criterion of what is reasonably or humanly impossible, the condition of impossible performance will still not be met easily, apart from the cases where international trade prohibitions (question 3) and actual shortage of raw materials (without alternatives) make performance impossible. In most cases the war in Ukraine will not prevent contractual performance but render it more onerous or difficult, which does not suffice to qualify as force majeure but could fall under a hardship clause (question 4). Mere delays (question 7) are more likely to be excused by force majeure.
If the impossibility to perform is temporary, the contract will not be terminated, but the prevented obligation is suspended until its performance becomes possible again. In the meantime, the reciprocal obligations of the other party are suspended as well. If the impossibility to perform is permanent (or if its delayed performance will be useless) the contract is automatically terminated and both parties are definitively relieved from their obligations.
