Covid-19 has created a global threat to the ongoing operations of many businesses. Several have been left at risk, unable to fulfil contractual obligations due to disruptions of their supply chain.
Osayaba Giwa-Osagie of our Nigerian member firm Giwa-Osagie & Co, co-authored an informative piece in Business Day outlining the doctrines of force majeure and frustration of contract which can provide relief to clients prevented or hindered from performing obligations under a commercial contract.
Simply put - frustration of contract puts an end to a contract, whereas force majeure only defers the performance of the contract until the supervening event abates or is no longer a factor.
To avoid a contract being found to have been frustrated, parties should apportion risks, by embedding a force majeure clause in the contract.
Click to read the full article in Business Day.