Tours, festivals and one-off shows are cancelled for an indeterminable period worldwide. As a result, artists, sponsors, venues and insurance companies have their respective lawyers analyzing who is liable due to the pandemic. If the agreement follows California law, the argument is over the interpretation of the force majeure clause, which its a staple in most contracts. The principle underlying the doctrine of force majeure is set forth in Cal. Civ. Code § 3526: “No man is responsible for that which no man can control.” Generally, a force majeure clause is triggered when the occurrence of a force majeure event, sometimes generally referred to as an “act of God,” ultimately renders performance so impracticable that it is excused.
In California, where the parties’ written agreement evidences an intent to address specific contingencies, those terms will generally control and be enforced by courts. The specification of any force majeure event necessarily precludes other force majeure events from being included within the definition. For example, if strikes, labor or fire or other casualty are listed, but not a viral pandemic, then the pandemic may not subject to the force majeure provision. Moreover, when no applicable force majeure language exists, contract law has a long history of recognizing and accommodating a party whose contractual performance is made impracticable or impossible by intervening forces, notwithstanding language in the contract. In fact, Cal. Civ. Code § 1511(2), states that the performance of an obligation is excused “when it is prevented or delayed by an irresistible, superhuman cause, or by the act of public enemies of this state or of the United States, unless the parties have expressly agreed to the contrary.” California applies this equitable principle broadly, holding that “force majeure…is not necessarily limited to the equivalent of an act of God.” The test for whether a force majeure/act of God situation is present is “whether…there was such an insuperable interference…as could not have been prevented by the exercise of due diligence.” Id. While the genesis of COVID-19 is currently unknown, it’s spread is clearly man-made (not an act of God) despite the diligent efforts of scientist and health professionals worldwide. It’s fury continues an insuperable interference with daily life and commerce worldwide.