The COVID-19 global pandemic is novel and unprecedented, yet it is forcing us all to pay close attention to somewhat archaic and “boilerplate” provisions in our contracts in order to evaluate what options may be available if COVID-19 requires that your event be cancelled. Most contracts contain a force majeure clause, a legal doctrine dating back to the 1800s, which excuses the contracting parties from performing their obligations under the contract if they are prevented from doing so by an “Act of God.”
Until recently, this type of clause was rarely an issue that business attorneys addressed in their daily practice. Because of this, there is little case law that provides attorneys with guidance when navigating their clients’ rights when a contract is cancelled due to COVID-19.
Not all force majeure clauses are created equal and the plain, unambiguous language of the contract is controlling for both parties. Many force majeure clauses are as broad as to simply state that “Act of God” will allow force majeure to apply and release the parties from their obligations. However, many of these clauses specifically spell out which “Acts of God” will trigger the force majeure clause. Some clauses specify, for example, that an “Act of God” includes tornadoes, hurricanes, earthquakes, war or insurrection, and rarely: pandemics.
If the scope of the force majeure clause in your contract is broad enough to cover COVID-19 as an “Act of God,” the question remains whether you are entitled to a partial or full refund of any previously paid deposits. Again, the plain and unambiguous language of the contract governs the parties. If your contract includes a provision specifying that deposits are retained regardless of an “Act of God,” you may not be entitled to a refund. However, sometimes businesses will issue a refund as an act of good faith, regardless of the language of the contract.
If your wedding or event was cancelled due to the COVID-19 pandemic, it is best to have an attorney evaluate your contract and determine what options may be available to you. Call Triangle Law Group to schedule a consultation to speak with an attorney to find out what recourse you may have.