How Force Majeure Clauses Affect Lease Agreements

2 June 2025

In the world of real estate, legal clauses can be a bit of a mystery, right? One of the most misunderstood (and often overlooked) clauses in lease agreements is the "Force Majeure" clause. If you're a landlord or tenant—or even just someone curious about lease agreements—you should definitely stick around. This article will break down what force majeure is, why it matters in lease agreements, and how it directly impacts both landlords and tenants, especially when life throws curveballs like pandemics or natural disasters.

Let’s dive in and untangle this legal jargon in a simple, conversational way.

What Is a Force Majeure Clause?

First things first—what on earth is a "force majeure"? The term "force majeure" is French for "superior force," which sounds fancy, doesn’t it? In simpler terms, it refers to unexpected events or disasters that are beyond anyone’s control. Think earthquakes, hurricanes, wars, pandemics—basically, the kind of stuff you can't predict or prevent no matter how well you plan.

A force majeure clause essentially says, "Look, if something totally unforeseen and unavoidable happens, neither party should be held accountable for not fulfilling certain obligations of the lease." It's like the “get out of jail free” card in Monopoly, but not exactly free because there’s still a lot of fine print to follow!

Why Are Force Majeure Clauses Included in Lease Agreements?

Imagine this: You’re renting out a commercial space to a trendy coffee shop, and suddenly a hurricane sweeps through the city, leaving the building inoperable for months. Or maybe a global pandemic shuts everything down, forcing that coffee shop to close its doors temporarily. Who’s responsible for the rent during this time?

That’s where the force majeure clause comes into play. It provides a legal framework to determine whether the tenant still needs to pay rent, whether the landlord is required to make accommodations, or if the lease can be paused or even terminated.

Without this clause, landlords and tenants could end up in heated legal battles, and trust me, no one wants that drama.

How Does a Force Majeure Clause Work?

1. Defining Applicable Events

The clause will specifically outline what counts as a "force majeure" event. It’s not a one-size-fits-all list—it depends on how the lease is negotiated. For instance, it might include:
- Acts of God (natural disasters)
- Government actions (lockdowns, regulations, martial law)
- Wars, riots, or terrorism
- Strikes or labor disputes
- Health crises (think COVID-19)

If the event isn’t mentioned in the clause, it probably won’t be covered. So, if aliens invade Earth tomorrow and that’s NOT in the clause? Welp, that might be a legal gray area!

2. Relief Options

Once a force majeure event occurs, the clause kicks in. But what happens next depends on what’s written in the lease. Common relief options include:
- Temporary suspension of rent payments
- Reduced rent for the affected period
- Termination of the lease if the event lasts for an extended time

It’s kind of like a safety net, but it’s not guaranteed to save the day every time.

3. Burden of Proof

Here’s where things get tricky. The party invoking the force majeure clause—whether it’s the landlord or tenant—usually has to prove that the event meets the criteria outlined in the lease. This means showing evidence that the event directly prevented them from meeting their obligations.

For example, if the tenant claims they can’t pay rent because of COVID-19 but their business is fully operational online, a court might not agree that the force majeure clause applies.

Impact on Tenants

So, how does a force majeure clause affect tenants specifically? In a nutshell, it can be a lifesaver—or a source of frustration.

1. Relief from Rent Payments

If a force majeure event makes the rental property unusable (say, due to flooding), the tenant may be excused from paying rent for the duration of the event. But not all clauses allow this! Some are very landlord-friendly and still require rent, no matter what.

2. Flexibility in Operations

For commercial tenants, especially small businesses, force majeure clauses can provide much-needed breathing room during tough times. Imagine having to shut down indefinitely due to a government lockdown—without such a clause, you’d still owe rent while bringing in zero revenue. That’s a nightmare scenario!

3. Negotiation Power

Tenants can negotiate the terms of the force majeure clause before signing the lease. This is your chance to add specific events (like pandemics) or clarify how rent obligations will be handled during such times. Think of it as customizing your safety net.

Impact on Landlords

Now, what does this mean for landlords? Spoiler alert: It’s a mixed bag.

1. Interrupted Cash Flow

Force majeure clauses can directly impact a landlord’s income stream. Imagine owning multiple rental properties and suddenly half of your tenants invoke the force majeure clause to stop paying rent due to a natural disaster. That’s a major dent in your bottom line!

2. Property Maintenance Obligations

Landlords often have maintenance obligations under the lease. If a force majeure event damages the property, the clause may require landlords to repair it before rent payments resume. This could involve significant out-of-pocket expenses.

3. Legal Disputes

Let’s face it, anything involving legal clauses can lead to disputes. If a tenant invokes the force majeure clause and the landlord disagrees, things can get messy. Legal battles are time-consuming, expensive, and—let’s be real—emotionally draining.

The COVID-19 Pandemic: A Real-World Example

We can’t talk about force majeure without mentioning COVID-19. The pandemic brought this once-obscure clause into the spotlight as businesses and landlords scrambled to make sense of lockdowns and closures.

For some tenants, the force majeure clause provided relief from rent payments during the shutdowns. For others, landlords argued that the pandemic didn’t make their properties "unusable" and therefore didn’t qualify as a force majeure event.

The results? Tons of lawsuits, renegotiated leases, and a renewed focus on the wording of these clauses. It was a wake-up call for everyone in real estate.

Tips for Negotiating a Solid Force Majeure Clause

Whether you’re a landlord or tenant, negotiating a well-rounded force majeure clause is crucial. Here are some quick tips:

1. Be Specific: Clearly define what events qualify as force majeure. Don’t leave room for ambiguity!
2. Address Rent Obligations: Spell out whether rent is suspended, reduced, or still due during a force majeure event.
3. Include Notice Requirements: Require the affected party to notify the other as soon as a force majeure event occurs.
4. Set Time Limits: Specify how long the clause applies before either party can terminate the lease.
5. Consult a Lawyer: Don’t DIY your lease agreement—get professional advice to ensure your interests are protected.

Final Thoughts

Force majeure clauses might sound like boring legal mumbo-jumbo, but they play a huge role in lease agreements. They’re the unsung heroes (or villains, depending on your perspective) that determine what happens when life throws unexpected challenges your way.

If there’s one thing the pandemic taught us, it’s that unexpected events WILL happen. Whether you’re a landlord or a tenant, understanding—and negotiating—a solid force majeure clause can save you a lot of headaches down the road.

So, the next time you’re reviewing a lease agreement, don’t gloss over that strange French term. It might just be the safety net you didn’t know you needed!