The Three Doctrines: An Overview
Force Majeure: The Contractual Doctrine
Force majeure — French for "superior force" — is a contractual provision (not a common law doctrine) that excuses one or both parties from performing specific lease obligations when a qualifying extraordinary event beyond their control prevents performance. The critical feature of force majeure is that its scope is entirely defined by the contract language. A force majeure clause in a lease says precisely: (a) what events qualify; (b) which obligations are excused; (c) what notice the claiming party must give; and (d) for how long the excuse applies before either party can terminate.
Because force majeure is contractual, courts interpret it according to its specific language. If the clause doesn't cover pandemics, pandemics don't qualify — regardless of how devastating they are. If the clause excuses landlord performance obligations but explicitly excludes tenant rent obligations, the tenant cannot claim FM rent relief even if their business is completely shut down by a government order. The contract text controls.
Frustration of Purpose: The Common Law Doctrine
Frustration of purpose is a common law doctrine that excuses contractual performance — even in the absence of a force majeure clause — when an unforeseen event so completely destroys the primary purpose of the contract that continued performance would be fundamentally unjust. The classic case is Krell v Henry (1903), where a tenant who paid for use of an apartment to view a coronation procession was excused from paying the remaining rent when the procession was cancelled due to the king's illness. The contract (use of apartment) was technically still performable — the apartment was available — but the entire purpose (viewing the procession) had been destroyed.
Frustration of purpose requires:
- The event must be unforeseen at the time of contracting
- The event must substantially frustrate the principal purpose of the contract (mere inconvenience or reduced profitability is insufficient)
- The frustrated party must not have assumed the risk of the frustrating event (either expressly in the contract or by the nature of the transaction)
- The purpose that is frustrated must have been known to both parties at contracting
Impossibility and Commercial Impracticability
Impossibility (and its modern variant, commercial impracticability) excuses performance when an unforeseen event makes performance objectively impossible — not merely more difficult or costly. Traditional impossibility required literal physical impossibility; the UCC and Restatement (Second) of Contracts expanded this to "commercial impracticability" — a standard that is satisfied when performance would impose an extreme and unreasonable burden that the parties did not contemplate. Both doctrines require that the claiming party did not assume the risk of the event and that the event was unforeseeable at contracting.
| Doctrine | Source | Trigger | Standard | Applies to Rent? |
|---|---|---|---|---|
| Force Majeure | Contract clause | Qualifying event listed in clause | Defined by contract language | Only if clause expressly includes rent |
| Frustration of Purpose | Common law | Primary purpose of contract destroyed | Purpose substantially frustrated, unforeseen, not assumed | Rarely — courts require near-total frustration |
| Impossibility | Common law | Performance made objectively impossible | Physical or legal impossibility | Almost never — paying money is always possible |
| Commercial Impracticability | Common law / UCC | Extreme unforeseen burden | Performance imposes unreasonable burden not assumed by party | Almost never in lease context |
COVID-19 as a Case Study: Why Most Tenants' Claims Failed
The Factual Setting
During the COVID-19 pandemic, state and local governments issued orders in March–May 2020 that required retail, restaurant, fitness, hospitality, and entertainment businesses to close entirely or dramatically curtail operations. Many commercial tenants — particularly in retail and hospitality — saw their revenues fall to near zero while their lease obligations (rent, CAM, insurance, taxes) continued to accrue. Tens of thousands of tenants attempted to invoke force majeure clauses, frustration of purpose, or impossibility to suspend or terminate their rent obligations.
The results were nearly uniformly unfavorable for tenants. Courts across the United States — with very limited exceptions — ruled that neither contractual force majeure nor common law doctrines excused commercial rent obligations during COVID-19.
Why Force Majeure Claims Failed for Tenants
Rent exclusions in FM clauses: The majority of pre-2020 commercial lease force majeure clauses contained explicit carve-outs excluding monetary payment obligations from coverage. Language like "notwithstanding the foregoing, Tenant's obligation to pay Base Rent and Additional Rent shall not be excused by any force majeure event" appeared in a substantial majority of leases. Tenants bound by this language had no FM claim for rent regardless of what the underlying event was.
Government order provisions were ambiguous: Many FM clauses listed "governmental action or order" as a qualifying event — but the question was whether a closure order affecting the tenant's business made performance of rent obligations impossible. Courts consistently held that: (a) a closure order made the tenant's use of the space impractical, but did not make the payment of money impossible; (b) the tenant could physically pay rent even if their business was closed; and (c) the FM clause covered the inability to perform specific acts, not the inability to generate revenue to fund those acts.
Foreseeability: Courts in some jurisdictions held that pandemics were foreseeable at the time of contracting (given SARS, MERS, H1N1, and other prior pandemic events), defeating FM claims that required unforeseeability.
Why Frustration and Impossibility Claims Failed
Frustration of purpose claims failed for two main reasons. First, courts generally held that the primary purpose of a commercial lease (having the right to use and occupy a specific space) was not totally frustrated by government closure orders — the tenant retained the legal right to enter and occupy the space; they were merely prevented from operating their particular business there. Second, courts held that business tenants assumed the risk of revenue disruption as part of the inherent risk of commercial enterprise — meaning the risk of a pandemic's economic impact was a risk the tenant bore, not an unforeseen risk that destroyed the contract's purpose.
Impossibility claims failed on the simpler ground that paying money is never physically impossible. A tenant may lack the funds to pay rent, but that is financial distress — not impossibility. Courts have consistently held, across generations of contract law, that financial hardship does not constitute impossibility.
The Real Dollar Stakes
Base rent: $50/sf/year
Monthly base rent: $20,833/mo
CAM/operating expenses: $15/sf/year = $6,250/mo
Total monthly obligations: $27,083/mo
3-MONTH FORCE MAJEURE EVENT:
3 months × $20,833/mo base rent: $62,500
3 months × $6,250/mo CAM: $18,750
Total obligations at stake: $81,250
WITHOUT FM RENT PROTECTION:
Tenant owes full $81,250 regardless of closure
Revenue during closure: $0 (full government shutdown)
Net loss from unprotected FM: $81,250 + lost revenue
WITH FM RENT ABATEMENT CLAUSE:
Base rent abated during FM event: $62,500 forgiven
CAM (if also abated): $18,750 forgiven
Total protection: $81,250
WITH FM RENT DEFERRAL CLAUSE (worse than abatement):
Rent deferred (not forgiven) — $81,250 owed later
Tenant still owes full amount, just on delayed schedule
Value of FM rent ABATEMENT vs. DEFERRAL on 3-month event: $81,250
What Events Actually Qualify
Force majeure event lists in commercial leases vary widely. Understanding which events typically qualify — and which don't — helps tenants assess whether their clause provides real protection:
| Event Type | Typically Qualifies? | Notes |
|---|---|---|
| Acts of God (earthquake, flood, hurricane) | Yes | Nearly universal in FM clauses |
| Acts of war, terrorism, civil unrest | Yes | Common; may require property damage in some clauses |
| Fire and explosion | Yes | Also covered by separate casualty provisions |
| Government closure orders (specific building) | Usually | Covers building condemnation, safety closures |
| Government public health orders (area-wide) | Disputed | COVID demonstrated courts may not apply to rent |
| Pandemic / infectious disease outbreak | No (unless specifically named) | Must be explicitly listed post-2020; often excluded |
| Labor strikes (building workers, unions) | Usually | Typically for landlord performance obligations |
| Utility failure (power grid, water) | Sometimes | Usually covered only for landlord-supplied utilities |
| Economic downturn, recession | No | Market risk; tenant assumed at signing |
| Supply chain disruption | No | Business risk; not a qualifying FM event |
| Inflation, increased costs | No | Economic risk; specifically excluded in most leases |
| Cybersecurity attack (building systems) | Rarely | Newer risk; not yet standard in FM clauses |
Negotiating Strong Force Majeure Protections
Explicitly Include Rent in FM Coverage
The single most important negotiating point is to include tenant rent obligations within the scope of FM protection. This requires affirmative language — the typical FM clause that covers "performance obligations" will be interpreted to exclude monetary payments unless rent is specifically mentioned. Negotiate language along the lines of:
"Notwithstanding any other provision of this Lease, Tenant's obligation to pay Base Rent and Additional Rent shall be abated for any period during which Tenant is prevented from operating its business at the Premises due to a Qualifying Force Majeure Event, for so long as such prevention continues, not to exceed [___] months in the aggregate."
Key features of this language: (a) it explicitly applies to rent; (b) it ties the abatement to the period of operational prevention (not just the FM event existing somewhere); (c) it caps total abatement duration; and (d) it uses "abated" (forgiven) rather than "deferred" (still owed later).
Expand the Qualifying Event List
Post-COVID, tenants should push for FM clauses that explicitly include:
- Pandemic, epidemic, or infectious disease outbreak declared by a governmental authority
- Public health emergency declared at the federal, state, or local level
- Government orders prohibiting or materially restricting the operation of businesses of the type conducted by Tenant at the Premises (not just orders affecting the building itself)
- Quarantine orders or mandatory evacuation orders affecting the area where the Premises are located
Notice Requirements
Force majeure notice requirements typically require the claiming party to deliver written notice within 10 to 30 days of the FM event beginning. This sounds straightforward, but in a rapidly developing crisis — like a pandemic that evolves over days — the notice deadline can slip past. Negotiate for:
- At least 30 days to give initial FM notice (not 10 days)
- The ability to give notice within 30 days of when the party knew or should have known that the FM event would affect their performance — not 30 days from when the event began
- Notice given by email (not just certified mail) to ensure timeliness during communication disruptions
Duration Limits and Termination Rights
Force majeure clauses typically include duration limits — the maximum period of FM protection before either party can terminate. Negotiate duration limits that reflect the realistic duration of the FM event type:
| FM Event Type | Typical Duration Limit | Recommended Minimum | Termination Right Holder |
|---|---|---|---|
| Natural disaster (localized) | 90–180 days | 180 days | Either party |
| Government closure order | 90–180 days | Duration of order + 30 days | Tenant only (landlord caused by FM) |
| Pandemic / public health emergency | 90–365 days | 365 days | Either party after 365 days |
| War / terrorism | 180–365 days | 365 days | Either party |
| Labor strike (landlord's contractors) | 90–180 days | 180 days | Tenant (if building is unusable) |
Abatement vs. Deferral: A Critical Distinction
The difference between FM rent abatement and FM rent deferral is enormous in practical terms. Abatement means the rent obligation is waived — the tenant owes nothing for the FM period. Deferral means the rent is postponed but still owed, typically with a repayment schedule tacked on to future months. For a tenant whose business generates zero revenue during a three-month government closure, deferral provides only a temporary cash flow benefit — they still owe the full $62,500 plus catch-up payments on top of resuming normal rent when the business reopens. Negotiate explicitly for abatement, not deferral.
6 Red Flags in Force Majeure Clause Language
🛑 Red Flag 1: Rent Explicitly Excluded from FM Coverage
A force majeure clause that contains language like "this provision shall not apply to Tenant's monetary obligations under this Lease, including Base Rent and Additional Rent" provides zero rent protection regardless of the FM event. This is the most common structure in standard commercial leases — and the reason COVID-19 FM claims mostly failed. Any tenant who wants FM rent protection must negotiate affirmative removal of this exclusion or insertion of explicit abatement language covering rent during qualifying events.
🛑 Red Flag 2: Event List Does Not Include Pandemics or Public Health Orders
A force majeure clause that lists only "acts of God, war, fire, earthquake, flood, or labor strikes" without mentioning pandemics, epidemics, infectious disease outbreaks, or public health emergency orders provides no protection against the most economically damaging type of FM event demonstrated in living memory. Post-2020, any FM clause that doesn't explicitly include pandemic-type events has learned nothing from COVID-19. Insist on explicit language for public health emergencies and government orders prohibiting or restricting business operations.
🛑 Red Flag 3: Notice Period Under 10 Days
Some force majeure clauses require the claiming party to give notice within 5 or 10 days of the FM event — an almost impossibly short window during an actively developing emergency. A pandemic declaration, hurricane, or civil unrest event may require immediate operational response that doesn't leave time for careful lease review and notice drafting. Negotiate for at least 30 days notice, measured from when the party knew or should have known that the FM event would affect lease performance.
🛑 Red Flag 4: FM Protection Is Deferral Only (Not Abatement)
A force majeure clause that defers rent rather than abating it leaves the tenant with a growing rent obligation during the FM period that must be repaid on top of normal rent resumption. For a business that generates zero revenue during a 90-day government closure, deferring $81,250 of rent obligation provides only temporary liquidity relief — the tenant will owe $81,250 plus interest when operations resume. Negotiate for abatement (forgiveness) of rent during qualifying FM events, not deferral.
🛑 Red Flag 5: FM Clause Only Protects Landlord Performance Obligations
Many standard commercial lease FM clauses are drafted entirely from the landlord's perspective — they excuse the landlord from construction delays, maintenance failures, and service delivery failures, but contain no tenant-side FM provisions at all. If the FM clause is entirely one-directional (landlord-benefiting), the tenant has no contractual basis for any FM relief. The absence of tenant-side FM protection is not a drafting oversight — it is a deliberate structure that tenants must actively negotiate to correct.
🛑 Red Flag 6: Short Duration Limit Forces Termination Too Quickly
A force majeure clause with a 30- or 60-day duration limit — after which either party may terminate the lease — may force the tenant into an involuntary termination before the FM event has resolved. During a pandemic or extended natural disaster, 60 days may not be long enough for government orders to lift or for the tenant to assess whether their business can resume at the location. Negotiate for duration limits of at least 180 days for physical FM events and 365 days for public health or government-order FM events, to give the situation time to resolve without forcing a permanent lease termination.
✅ 12-Item Force Majeure Clause Negotiation Checklist
- Explicitly include Tenant's rent obligations (Base Rent and Additional Rent) within FM coverage — do not accept an FM clause that excludes monetary obligations from the scope of protection.
- Negotiate abatement (forgiveness) of rent during qualifying FM events — not deferral (postponement). Deferred rent still accrues as a liability; abated rent is eliminated.
- Explicitly list pandemics, epidemics, infectious disease outbreaks, and public health emergencies in the qualifying event list — do not rely on "catch-all" or "acts of God" language to cover government public health orders.
- Include government orders prohibiting or materially restricting business operations of the type conducted at the premises — not just orders affecting the physical building.
- Negotiate at least a 30-day notice period measured from when the party knew or should have known the FM event would affect lease performance — not from the moment the event began.
- Confirm FM protection applies to both parties — the clause should excuse both landlord performance obligations and tenant rent obligations during qualifying events, not only one party.
- Set duration limits appropriate to the FM event type — at least 180 days for physical events, 365 days for public health/government order events, before termination rights activate.
- Define "prevention" broadly — FM protection should apply when the tenant is prevented from operating their business at the premises, not only when physical access to the space is impossible.
- Require FM protection to track the actual duration of the FM event — abatement should last as long as the event prevents operations, up to the duration cap, not for a fixed period regardless of actual duration.
- Address partial business restriction (not just full closure) — if government orders reduce capacity to 25% or 50%, negotiate proportional rent reduction (not binary all-or-nothing relief).
- Confirm FM notice can be given by email — certified mail-only notice requirements create compliance risk during emergency conditions when postal services may be disrupted.
- Specify that economic downturn, supply chain disruption, and financial hardship do NOT constitute FM events — this protects the tenant if the landlord tries to invoke FM to excuse its own maintenance or delivery obligations due to budget constraints.
Frequently Asked Questions
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