The doctrine of force majeure is a legal principle that allows for the suspension or termination of a contract when an extraordinary event or circumstance beyond the control of the parties, such as a natural disaster or pandemic, prevents them from fulfilling their obligations under the contract. This doctrine is often included in contracts to provide a way for the parties to address unforeseen events that may affect their ability to perform their obligations. The specific events or circumstances that are considered to be force majeure events are typically listed in the contract or are of a similar nature to events that are listed. If a force majeure event occurs, it may allow the parties to extend deadlines or terminate the contract without liability for non-performance. Many have wondered if the COVID-19 pandemic constitutes force majeure.

From the 1st District Court of Appeals, we have an answer: No.

This case involved a contract for the sale of a 154-acre undeveloped parcel of land between Dwight Griffis and Richard Griffis (the sellers) and Apex Group, LLC (later assigned to Rockwell at Amelia Landing, LLC, the buyer). The contract included a force majeure clause that allowed either party to extend deadlines or terminate the contract if performance was prevented by an act of God or force majeure, such as a pandemic. In March 2020, a public health emergency was declared due to the COVID-19 pandemic, and the buyer argued that the pandemic should be considered a force majeure event, allowing it to extend deadlines. The sellers disagreed and argued that the buyer was not prevented from closing on the property by the pandemic.

The court ruled in favor of the sellers, finding that the force majeure clause did not apply to the facts of the case because the emergency occurred during the buyer’s inspection period, and buyer was not unable to notify the sellers of the property’s unacceptability. Furthermore, while the buyer’s efforts at obtaining development approvals were impacted by the pandemic, their ability to close was not. The court also noted that the sixth addendum to the contract, which extended the contract’s deadlines, was signed after the COVID-19 pandemic had been declared and did not specifically mention the pandemic as a force majeure event.

This case makes clear that the mere existence of the pandemic, or even the declaration of a state of emergency by the authorities, will not by itself excuse a party from performance. It also emphasizes the need for clear communication between parties and the importance of understanding the potential impacts of events such as pandemics on real estate transactions, and the need to carefully tailor real estate contracts to the specific needs of each transaction.