one with collateral, often used in contracts between traders, is the exclusion of liability for failure to perform or improper performance of the contract in the event of force majeure. How can we understand it in law?
In a global pandemic, governments of individual countries at risk of epidemics introduce a number of changes to reduce the spread of the virus SARS-CoV-2.
The Polish government decided to close schools, shopping malls, cinemas or theatres, and encourage to undergo social quarantine, in the so-called meantime preparing their system solutions to help entrepreneurs. The introduction of restrictions affected relations between entrepreneurs.
Trying to minimize the losses caused by the epidemic, they seek legal solutions to safeguard their interests. one of them is recourse to the force majeure clause.
In literature and judicature, it is accepted that the rebus clause sic stantibus is no exception to the pacta sunt servanda principle (i.e. that the agreements must be kept), or actually strengthens this principle
The concept of force majeure
Under the Civil Code, the concept of force majeure has not yet reached a legal definition. In practice, a higher force is assumed to be an external event, impossible to predict and impossible to prevent. In science, events involving force majeure, grouped in third categories: catastrophic nature action (e.g.
tsunamis, hurricanes), acts of legislative and executive authority (e.g. nationalisation of private enterprises) and certain disturbances in collective life (e.g. riots, terrorist attacks).
Often in such contracts, the entrepreneur, in order to safeguard his interest as much as possible, publishes an open catalogue listing events which are treated on an equal basis with a higher force (Lac. vis Maior).
Given the constraints and limitations imposed by the government, which have a real impact on many industries, the current situation may be classified as a force majeure, especially as the government has officially introduced a state of edpidemia.
Contractual liability a vis maior
In a sector such as catering, it will be much easier for entrepreneurs to demonstrate that the lack of performance of the contract is due to force majeure, than to entrepreneurs from the IT industry, for example, whose employees, following government guidelines, work in their homes remotely.
When we want to refer to the exception of force majeure, we must remember that contractual liability is based on the principle of presumption of guilt. This means that the burden of proving that non-execution or improper performance of the contract is a consequence of force majeure lies with the party that does not perform its obligation.
It is also important to demonstrate that there is a causal link between non-execution or improper performance of the contract and the state of force majeure. In every case, the occurrence of an event such as the coronavirus epidemic will have an objective effect on the inability to perform or properly execute the contract.
Force majeure and Civil Law
The provisions of the General Civil Code on contractual liability do not apply to force majeure. Responsibility for failure to perform or improper execution under the Civil Code is generally based on guilt. This means that contractual liability can be attributed to the party to the contract, only if the damage was caused by the failure or improper performance of the contract due to its fault.
Online training: Coronavirus and the rights and obligations of the employer and employee
Despite the lack of a force majeure clause in the agreement, general principles resulting from the Civil Code can be invoked. According to Article 471 the civil code of the debtor is obliged to make good the damage resulting from the default or breach of the obligation, unless the failure or improper execution is due to circumstances for which the debtor is not liable.
It is also worth mentioning in the context of the impact of coronavirus on the ongoing activity with an emergency change clause (rebus sic stantibus) envisaged under Article 3571 a civil code according to which, if due to an exceptional change in relations, the fulfilment of the benefit would be linked to excessive difficulties or would threaten one of the parties a gross loss which the parties did not foresee in the conclusion of the contract, the court may, after consideration of the interests of the parties, in accordance with the principles of social coexistence, determine the manner in which the undertaking is carried out, the amount of the benefit or even the termination of the contract. When terminating the contract, the court may, where necessary, rule on the settlement of the parties, following the principles laid down in the preceding sentence.
In literature and judicature, it is accepted that the rebus clause sic stantibus is no exception to the pacta sunt servanda principle (i.e. that contracts should be kept), or actually strengthens this principle.
one the principle of will autonomy and the principle of equality, which, in principle, gives the parties the freedom to shape civil relations between themselves. The emanation of this principle is freedom to shape the content of the agreement, as well as freedom to choose the parties to the agreement.
A Party that makes a reasonable decision on the conclusion of a given contract, in its own interest, shall act on the basis of calculated risks that can be predicted at the time of the conclusion of the contract.
The occurrence of all exceptional circumstances which are not foreseeable before the conclusion of the contract will, in a way with retroactive effect, render the freedom with which the contracting party was guided.
The uncertainty caused by the current situation, both social and business, leads to often unfavorable decisions that may have adverse effects in the coming months.
A cool analysis and support of experienced advisors who effectively juggle, among other things, the concept of vis maior in law, will help to mitigate the consequences of chaos, which, so far, is based on global mathematical calculations.
Only by eating knowledge and experience are we able to take the right steps to get out of the situation with a dry foot.