With the advent of COVID-19 and the direct disruptions of Colorado and national businesses caused by the crisis, many businesses and individuals are suddenly struggling with contractual obligations due to these unforeseen circumstances. Colorado contract law may afford relief.
Some contracts have force majeure clauses that describe a series of events that can excuse performance if an event covered by the clause occurs. Whether or not an event triggers a force majeure clause will depend on the specific language in the clause. Some courts have required the clause to specifically include the event preventing the party’s performance.
If your contract does not have a force majeure clause, the doctrine of impossibility may still excuse performance if an event has occurred which 1) was not reasonably foreseeable, and 2) the unforeseen event makes the promise vitally different from what the parties should have reasonably expected when they entered into the contract. Whether these doctrines apply depend on the specific contract language and circumstances, and an event that simply makes performance more expensive or unprofitable will typically not establish impossibility. For more information, contact Thomas P. Howard, LLC for a free consultation.