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Force majeure in Construction Claims

Dr. Franco Mastrandrea

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francomastrandrea@hka.com

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Whilst force majeure appears to be regarded as a basic concept in contract of broad, general, application in the civil law, it found no such place in the common law, where it early on earned a reputation as a vague and uncertain concept.

Force majeure provisions have nevertheless increasingly gained a firmer foothold in common law jurisdictions by way of a pragmatic response to the perceived historical rigidity/harshness/lack of commerciality there of the general law of contract.

The early common law of contract proceeded on the basis that, unless a limited exception recognised by the general law operated to the contrary, contractual obligations were absolute. That was because the parties were, through their contract, able to provide otherwise. It was therefore up to the contracting parties to look after their own interests, by making express provisions to avoid or limit liability. It thus worked to the advantage of the astute, and to the disadvantage of the weak and uninformed. In construction cases the focus, bolstered further by the later common law concept of entire contracts, tended to be on the contractor’s obligation to complete. The general rule was that the risk remained with the contractor until completion of the relevant works.

To that historical presumption of absoluteness there are at the present day several exceptions, the most important of which are where:

(a) upon a proper interpretation of the contract, the obligation is less than absolute; or

(b) the doctrine of frustration operates.

The common law, by contrast with the civil law which appears early to have recognised the unfairness of expecting contracting parties to achieve the impossible, latterly introduced the doctrine of frustration.

This came some two hundred years after Paradine v. Jane[1](1646) Al. 26, (1647) 82 ER 897. first laid down in clear terms the concept of absolute obligations. Frustration thus began to attenuate the harsh absoluteness rule. It did so by recognising that a post-contractual event not attributable to the contracting parties, rendering performance impossible or something radically different from that undertaken, discharged the contract.

But frustration proved insufficient in practice, particularly given its narrow ambit of operation: it applied only in extremely limited circumstances when post-contract supervening events beyond the control of the parties occurred. Further, and importantly, it automatically terminated further performance under the contract.

In the US, a more broadly-based liability exception emerged, first through the concept of impossibility, then, more leniently, of impracticability.[2]For a useful summary of the law on these two concepts in a construction case, see Conner Brothers Construction Company v. United States 65 Fed.Cl. 657 (2005). Even so, relief was typically hedged in, such as by the need to show first, that a contingency – something unexpected – must have occurred, second, that the risk of the unexpected occurrence must not have been contractually allocated, either by agreement or by custom, and finally, that the occurrence of the contingency must have rendered performance ‘commercially impracticable.’[3]See, for an example in the broader law, the United States Court of Appeals District of Columbia Circuit judgments in Transatlantic Financing Corp. v. United States 363 F.2d 312 (1966). This was more … Continue reading

Express force majeure provisions represent the modern preferred approach. Such provisions can better serve the will of the parties. Thus, the occurrence of the force majeure event need not result in termination of further performance under the contract. Experience nevertheless shows that force majeure provisions are, typically, concerned with occurrences beyond the control of the parties; the common thread tends to be that of the unexpected occurrence, something beyond reasonable human foresight and skill, leading to the temporary suspension, re-appraisal, re-configuration, and/or re-programming of the balance of works, rather than its termination.

The approach to the interpretation of these force majeure provisions can accordingly become of vital importance. It typically is no different from that adopted in relation to the construction of express contractual terms generally – having regard to the particular words used, and context. It therefore behooves the parties to avoid/reduce/manage disputes over meaning and scope, by expressly defining the term,[4]For an undefined such term, see for example, Clause 2.29.15 of the JCT 2016, With Quantities Standard Form of contract. such as was not the case in the Singapore case of Ser Kim Koi v. GTMS Construction Pte. Ltd.[5][2022] SGHC(A) 34. A more structured approach is to be seen in the (Clause 18) ‘Exceptional Events’ provisions (the term ‘force majeure’ is not used) of the FIDIC 2017 Edition of contracts. These set out a ‘not limited to’ list of events and circumstances that prevent or will prevent a party from performing any obligations under the contract (albeit a formulation which still leaves room for argument as to interpretation, scope, and application).

Even so, questions of burden of proof, whether financial relief is available (and if so, the measure of that relief, and how it is to be quantified), causation, and mitigation are likely to arise as common issues, and again are likely to benefit from some express contractual treatment.

In summary, the common law has found it hard to break away from its historical association with absolute contractual obligations. Frustration has not been a sufficient response to relieving liability, whether in its scope or in its refusal of a remedy which falls short of a wholesale throwing over of the original contract. Nor have the yet broader U.S. concepts of impossibility and impracticability been either sufficient or comprehensive. Express contractual force majeure provisions have accordingly, and increasingly, become the means by which those concerns are addressed in modern construction contracts. 

For a more detailed article on this topic, see The Rise and Rise of Force Majeure in Construction, expected to appear at [2025] The International Construction Law Review 4.

Franco Mastrandrea is a Chartered Quantity Surveyor and Chartered Arbitrator with over 40 years of experience in the construction industry. He has acted as expert on more than 50 international project management, delay and quantum-related disputes.

References

References
1 (1646) Al. 26, (1647) 82 ER 897.
2 For a useful summary of the law on these two concepts in a construction case, see Conner Brothers Construction Company v. United States 65 Fed.Cl. 657 (2005).
3 See, for an example in the broader law, the United States Court of Appeals District of Columbia Circuit judgments in Transatlantic Financing Corp. v. United States 363 F.2d 312 (1966). This was more recently considered in the construction case of Ames Construction, Inc. v. Clark County et al. 2020 WL 3488736, holding that whilst a contractor experienced significant delays due to flooding during construction, the risk of that occurrence had been contractually allocated to the contractor, rendering claims over the accuracy of a representation by the employer of the average flow of water at the project irrelevant, given the explicit assignment of the risk.
4 For an undefined such term, see for example, Clause 2.29.15 of the JCT 2016, With Quantities Standard Form of contract.
5 [2022] SGHC(A) 34.

This publication presents the views, thoughts or opinions of the author and not necessarily those of HKA. Whilst we take every care to ensure the accuracy of this information at the time of publication, the content is not intended to deal with all aspects of the subject referred to, should not be relied upon and does not constitute advice of any kind. This publication is protected by copyright © 2025 HKA Global Ltd.

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