Force Majeure

Who gets the blame?

It is common for companies to incorporate “Force Majeure clauses” in their business contracts.

Force Majeure is French for “greater force.” American companies refer to the events covered by these clauses as “Acts of God.”

In order to limit liability in the face of catastrophic events, companies seek to lay blame on God as the cosmic culprit for their inability to meet their obligations. No doubt things like earthquakes, floods, tornadoes and hurricanes can have disastrous effects and that these are not within a company’s control.

But is it ironic that capitalist firms are willing to acknowledge the will and power of an Almighty God in order to protect their interests? Would they be just as quick to acknowledge God for their successes and the basis of their profits?

I’ve negotiated enough contracts to know that stuff happens and you can’t control for every contingency and that it’s prudent planning to protect yourself from the uncontrollable events that can disrupt your business. But it sure would be fun to figure out how to negotiate a clause that said something like this,

“If, in the execution of this contract, actual performance exceeds the goal by 10% or greater, both firms agree to give 10% of the excess benefit to God.”

Now, that would be a contract of greater force.