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Force majeure: Difference between revisions
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An [[Act of God]]. | {{g}} | ||
===Tricks for young players=== | |||
[[Force majeure]] addresses unpredictable external contingencies that make practical performance of the contract impossible — floods, hurricanes, the catalogue of amusing vicissitudes that are set out below. But the concession [[force majeure]] offers is ''time bound'': eventually, you must get up, dust yourself off and get on with the business of performing your contractual obligations. You can’t blame your delinquency on Cyclone Rudolph for ever — unless the obligation suspended itself were time-bound, and has no value by the time the disaster conditions have lifted. (If I have rented my room overlooking the Lord Mayor’s Parade for the day to a fellow who wants to watch it, an earthquake that demolishes my room the night before the parade is going to be pretty conclusive<ref>Okay, okay — if there is an earthquake the parade may be delayed. I get that. But imagine it wasn’t. Most analogies don't bear close examination, right?</ref> | |||
So if, for example, the force majeure event is the catastrophic failure of your hedge counterparty to deliver you securities you had on-sold to a client, a[[force majeure]] in your client contract might excuse you from performance on the day, but only for so long as it took you to find another source of the securities in question. To absolve you ''absolutely'' from your obligation to your client, you would need something stronger: a [[limitation of recourse]]. Something like that. That is to say, a [[force majeure]] ''delays'' the inevitable; it does not [[extinguish]] it. | |||
===General concepts=== | |||
An [[Act of God]]. In these godless days, contracting folk are sanguine and insert dull generalities (such workmanlike prose as “an event outside a party's control which it could not reasonably have avoided and by dint of which the contract is impossible to perform”), but there was a time — a better, gentler, happier time — in which [[force majeure]] was a lawyer’s one chance to really stretch his literary wings. The [[Jolly Contrarian]] went quite mad with it: | |||
:''{{ultimate force majeure}}'' | :''{{ultimate force majeure}}'' | ||
{{seealso}} | {{seealso}} | ||
*[[Limited recourse]] | |||
*[[Force Majeure Event - ISDA Provision]] | *[[Force Majeure Event - ISDA Provision]] | ||
*[[Force Majeure - GTMA Provision]] | *[[Force Majeure - GTMA Provision]] | ||
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{{c2|egg|Astrophysics}} | {{c2|egg|Astrophysics}} | ||
{{published}} | {{published}} | ||
{{ref}} | |||