Understanding Force Majeur
A major healthcare association convention opened at the Hynes Convention Centre two days after the Boston Marathon Bombings.
What if it had been your meeting?
Two days after the Boston Marathon bombings – and before the suspects had even been publicly identified – a 2,000-attendee healthcare association convention opened at the Hynes Convention Centre.
The question is: What if they had to cancel? That’s where force majeure clauses come into play.
Force majeure is a legal concept that excuses a party for not performing to the letter of a contractual obligation when an occurrence beyond its control prevents or hinders performance.
The principle is embedded in the common law of contracts, so it is not necessary to add a force majeure provision to a contract. In fact, force majeure clauses proposed in many meeting-related contracts are often more restrictive than general legal principles.
A typical convention centre provision states that the contract may be terminated without liability if the centre is not available. But beware if a centre is able to remain open, but you are unable to get your delegates there, should the area be inaccessible? Contract language trumps general principles, so you might be out of luck.
Standard hotel force majeure clauses allow termination if a listed series of events renders performance “illegal or impossible.” It wasn’t illegal or impossible for the healthcare group to get to Boston.
It probably wasn’t “commercially impracticable” either, that being a generally recognised legal term essentially meaning “very difficult,” which many planners suggest being used in addition to the stricter hotel-proposed alternatives.
The term “inadvisable” is sometimes proposed by planners, but many hotels push back out of concern that this ill-defined term may just be an excuse for “we don’t want to go ahead with our meeting.”
It’s important to realise that the typical hotel-proposed force majeure provision takes an “all or nothing” view; that is, the planner must either terminate or go ahead, and possibly get hit with an attrition fee.
A well-written provision should allow for the organisation to partially perform its obligations—perhaps bring some but not all of its attendees—without liability.
Sometimes, it’s better to have no specific force majeure clause rather than being saddled with an overly restrictive provision.
In Addition to Your Contract…
Most planners incorporate basic risk management into their events – but what about crisis plans? A good plan should consider everything that could go wrong, prioritize the likelihood of something unexpected happening, outline reactions, specify triggers to invoke the plan, and detail which staff member does what and when.
There should be a written plan for each event in the case that the person who developed the plan becomes ill or there is an accident.
Tragic occurrences like the Boston Marathon bombing could never be anticipated, but good contractual and risk management planning can minimise their impact on meetings and events.
Source : James M. Goldberg, author of The Meeting Planner’s Legal Handbook.
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