Due to the Corona pandemic or the Ukraine war, the concept of force majeure has gained prominence in business law. However, not everything can be justified by force majeure.
Crises like the Corona pandemic or the Ukraine war have a significant impact on the economy. In addition, there are further issues that cause delivery bottlenecks or supply chain disruptions. As a result, it is becoming increasingly difficult for many companies to fulfil their contractually assured services. This is often justified with force majeure, but not every delivery bottleneck also means force majeure, says lawyer Michael Rainer, law firm MTR Legal.
Force majeure generally arises in the case of unforeseeable and unavoidable events that are beyond the control of the contracting party and cannot be avoided even with reasonable and acceptable means. However, this is by no means a free pass for the parties to fail to fulfil their contractual obligations. This is also demonstrated by a ruling of the Berlin Court of Appeal from May 24, 2022 (File No.: 21 U 156/21).
In the case at hand, a property developer committed to delivering an apartment ready for occupancy to the buyer by June 30, 2018, as per the notarized developer agreement. In actuality, the apartment was handed over to the buyer almost two years later, on July 6, 2020. Due to the delayed completion of the apartment, the buyer had to move into a rental apartment and demanded compensation for the incurred costs from the developer.
The property developer partially denied responsibility for the delayed handover at least to some extent. Due to the Corona pandemic, foreign construction workers were unable to enter Germany between March and July 2020. Additionally, there were delivery bottlenecks during this time, and construction materials could not be delivered.
The Berlin Court of Appeal did not accept this argumentation. The property developer must specifically demonstrate which serious and unforeseeable circumstance impacted the construction project to cause the delay. He must illustrate how and for what duration the workflows were disrupted. He must also consider construction-time favoring circumstances, such as bringing forward services. A general appeal to force majeure is insufficient. As the developer could not meet these requirements, the court ruled him liable for damages.
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