Acts of God

Acts of God January 10, 2020

In legal usage, “Acts of God” are natural hazards outside human control, such as an earthquake or tsunami. Acts of God are often cited as an exception in liability contracts. The phrase is called a “term of art” in law; a combination of words that has a particular meaning. Another phrase that has the same meaning is force majeure, which is French for “superior strength.” A better description than either of these would be “Acts of Nature,” or how about just natural disasters?

The legal precedent dates back to at least 1581 when an English court ruled that the death of one party in a contract was sufficient to nullify the obligations of that party because it was an “Act of God.” Since then, the meaning of the phrase has expanded considerably and is often used by businesses to evade contractual obligations, especially in the case of insurance policies and product warranties, but it is often included in the fine print of other kinds of performance contracts.

What events qualify as an Act of God? It varies considerably. My homeowner’s insurance policy specifically excludes damage from earthquakes, but wind and fire damage are covered, both of which could conceivably be considered the deity’s doing. It’s a catchall phrase that can mean whatever the contract or policy writer wants it to mean. I doubt if most people read the fine print in their contracts closely, so this is a handy backdoor exit for unethical service providers.

Why are we still using an archaic reference to a deity in the legal language of business contracts? Good question. I would love to see one of the many consumer advocacy groups take this on as a cause celebre, publicizing abuses of it, and making consumers aware of the danger it represents. It should be replaced with language that clearly describes the conditions under which contracts and insurance policies will not be honored.

An additional bonus is that it will eliminate one more inane reference to a nonexistent deity in our language. References to superstitious beliefs have no place in business contracts.

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