Impact of COVID-19 on Contracts - Force Majeure as a Tool to Save from Frustration?

Abstract

COVID-19 has taken the commercial world by storm as its rising spread has led to global border closure, halt in trade and commerce which has further led to a massive disruption of the existing supply chain. Owing to these events, commercial contracts have been affected significantly whereby the performance of obligations is hit by impossibility. Through this paper, the author delves into the Indian legal scenario specifically to analyse the remedies for a contract that is suffering from nonperformance due to the outbreak of COVID-19. The author scrutinizes on the concept of Contingent contracts and, ‘Force Majeure’ as a tool to save contracts from frustrating under The Indian Contract Act, 1872. Lastly, this paper also discusses in brief Government contracts in the current scenario apart from the intricacies involved in invoking Force Majeure as a valid excuse of non-performance, for COVID-19 being considered as a Global Pandemic beyond human control.

Keywords: Force Majeure India, Contract Act 1872 force majeure