Under precedential authority set forth by Florida Courts,\na party will be excused from performance under a contract when an Act of God\nrenders the ability to perform a contractual obligation impossible. An \u201cAct of\nGod\u201d is one which is so extraordinary and unusual that human foresight could\nnot have adequately predicted its occurrence. See,<\/em> Seaboard Air Line\nRy. Co. v. Mullin<\/em> 70 So. 467 (Fla. 1915). Typically, under a common law\ntheory, performance must be impossible.<\/em> That said, the common law theory\nof force majeure is strict in its application. The very performance of the\ncontractual obligation must be impossible\u2014such as destruction of a home by\nTornado which is the subject of a valid contract for sale. Coronavirus is\ndifficult to fit in the common law scheme as most contracts are not made impossible<\/em>\nto perform because of it, with exception. Specifically, a party would not be\nexcused from contractual obligations arising under any type of purchase\ncontract simply because that party lost their job. It would make it difficult\nfor the party to perform, but not impossible. An obligation under a contract is\nnot terminated solely because it became burdensome for one party to perform. On\nthe other hand, a restaurant which faces government-mandated closures, which is\nunable to fulfill a catering order because of the closure, would be excused\nfrom performance because it is impossible for the business to operate given the\ngovernmental regulation. Similarly, if a\ntitle company were to close, for example, a buyer or seller may be excused from\ncertain performances because the Buyer\u2019s funds are held in the account of the\nclosed title company. As such, common law force majeure is dependent upon the\nfacts and circumstances attending each case and depends upon impossibility\nof performance<\/em>. <\/p>\n\n\n\n Contractual Force\nMajeure<\/em><\/strong><\/strong><\/p>\n\n\n\n <\/strong>Some contracts, in their own\nlanguage, contains provisions relating to force majeure and acts of god. In\nthis instance, the contractual terms itself can expand upon the common law\nrequirement of impossibility<\/em>. In that instance, the terms of the\ncontract control, and supplement the common law force majeure. <\/p>\n\n\n\n Florida Real Estate Contracts and Force\nMajeure: <\/em><\/strong><\/p>\n\n\n\n <\/strong>The FR\/BAR \u201cAS IS\u201d (\u201cContract\u201d)\ncontains a force majeure provisions which provides as follows: <\/p>\n\n\n\n <\/strong>This\nSection contains various items of note: <\/p>\n\n\n\n Q: WHAT HAPPENS IF THERE\nIS A DELAY OR DISRUPTION SUBJECT TO THE FORCE MAJEURE PROVISION? <\/strong><\/p>\n\n\n\n A: The deadline for\nperformance will be extended a reasonable time up to seven (7) days, after\nthe Force Majeure no longer prevents performance, but in no event more than\nthirty (30) days after the Closing Date\u2014at which point either party can cancel,\nand the buyer would be entitled to a return of the deposit. <\/p>\n\n\n\n Q: DOES FORCE MAJEURE ALLOW FOR THE\nINSPECTION TO BE DELAYED?<\/strong><\/strong><\/p>\n\n\n\n A. Force\nMajeure is governed by Standard G of the Contract. Force Majeure means:\nhurricanes, floods, extreme weather, or other acts of God\u2026which\nby exercise of reasonable, diligent effort, the nonperforming party\nis unable in whole or in part to prevent or overcome. If it\u2019s determined that Force\nMajeure applies, the Parties shall not be required to perform any obligation\nunder the Contract so long as performance or non-performance or the\navailability of services or required approvals essential to Closing cannot\nreasonably or diligently be procured. Under this standard, the Closing Date\nwill be extended a reasonable time up to seven (7) days, after the Force\nMajeure no longer prevents performance. So, for example, a lack of power\nto the Property which would enable an inspection, would likely prevent\nperformance under the Contract and would likely constitute a Force Majeure. <\/p>\n\n\n\n Q: WHAT IF THE BUYER REQUESTS TO EXTEND\nTHE INSPECTION PERIOD UNDER FORCE MAJEURE?<\/strong><\/strong><\/p>\n\n\n\n A. If\nthe services necessary to perform the inspection are able to be procured by the\nBuyer through reasonable, diligent efforts, (i.e. inspector), there would not\nbe any delay or extension of the Inspection Period; if a Buyer states that\nhis\/her inspector is suspending business, this is not force majeure, as the\nBuyer could find another inspector. <\/p>\n\n\n\n Q. WHAT IF A LENDER REFUSES TO CLOSE AFTER\nISSUING A LOAN APPROVAL? <\/strong><\/strong><\/p>\n\n\n\n A. If\na Lender flat out refuses to close any loans for which approvals have been\npreviously granted, and shuts down its lending operations, force majeure would\nnot kick in. The flat-out refusal of a lender to close a loan transaction would\nnot constitute a \u201cdelay or disruption\u201d of services essential for closing.\nHowever, if a Lender, rather than canceling files, simply says they are suspending\n<\/em>lending operations for a set period of time, then force majeure may be\ntriggered to delay closing. Given the ambiguity in the wording of Standard G on\nthe FR\/BAR Contract, the failure to obtain financing might be subject to\nmultiple, varying interpretations insofar as standard G is concerned. This\nrequires a case-by-case analysis of the facts applicable to each case. <\/p>\n","protected":false},"excerpt":{"rendered":" Since the COVID-19 situation has developed, our office has fielded questions from real estate agents, business owners, brokers, and clients as to how the pandemic will affect certain contractual rights and obligations. Force Majeure is a concept in contractual law which allows for the non-performance of certain contractual obligations. Specifically, force majeure enables a party […]<\/p>\n","protected":false},"author":6,"featured_media":2606,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_seopress_robots_primary_cat":"none"},"categories":[37,1],"tags":[87,85,86,88,13,53],"yoast_head":"\n![\"\"](\"http:\/\/barrymillerlaw.com\/stagingv3\/wp-content\/uploads\/2020\/03\/Picture1-1.png\")
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