What is a "force majeure" clause in lease agreements?

A "force majeure" clause in lease agreements is a provision that addresses unforeseen events that are beyond the control of the parties involved, which may prevent them from fulfilling their contractual obligations. These events typically include situations such as natural disasters, war, terrorism, strikes, or other catastrophic occurrences. When such an event occurs, the force majeure clause allows the affected party to be relieved from liabilities or penalties that would typically arise due to their inability to perform as agreed.

This clause is essential for providing clarity and protection to both landlords and tenants regarding the expectations and responsibilities in the face of unpredictable circumstances. By including a force majeure clause, the lease agreement recognizes that sometimes parties may genuinely be unable to meet their obligations due to circumstances outside their control, thus offering a fair and understandable solution.

Other options, such as a penalty for a lease default, extending the lease term, or requirements for additional insurance coverage, do not accurately capture the essence of a force majeure clause. These subjects pertain to specific obligations, extensions, or risk management in a lease, rather than offering a safeguard against extraordinary events that disrupt normal leasing activities.