In contrast to America’s financialized economy, China has shown how natural it is for society simply to acknowledge that debts, rents, taxes and other carrying charges of living and doing business cannot resume until economic normalcy is able to resume. Their aim was to restore economic normalcy after major disruptions. And even less extreme weather events, like abnormally cold weather, can meet the definition if they are unusual and unexpected. Labor was the scarcest resource, so a precondition for survival was to prevent creditors from using debt leverage to obtain the labor of debtors and appropriate their land. A natural phenomenon can be an act of God So cancelling debts to restore normalcy was simply pragmatic, not utopian idealism as was once thought.

Hammurabi did this on four occasions. That is why every successful society since the Bronze Age has been a mixed economy. The foregoing is especially true with our hardest hit industry: hospitality (restaurants, bars, hotels and motels, event planning, transportation, cruise lines, and airlines). And believe it or not, even as a litigator, I encourage that,” she said. Individualistic economies cannot do that.

Meanwhile, parties seeking to enforce contracts or impose liability may seize on the economic fallout of the outbreak and argue that the actual hindering force was not the coronavirus, but its economic effects. Automobile debt is needed to buy a car to drive to the job, and credit-card debt must be run up to pay for living costs beyond what one is able to earn. In April, the Canadian Transportation Agency said exceptions within force majeure clauses may affect travellers' ability to receive refunds from airlines forced to cancel flights.

While not all states recognize impracticability as a common-law doctrine, the Uniform Commercial Code has codified it at U.C.C.

Something that is probably common to all of these contracts is a force majeure clause. Atlantic Contracting and Material Co., Inc. v. Ulico Cos. Co., 380 Md. A related term is force majeure (French for superior force), which may also excuse the performance of a contractual obligation when the unexpected event prevents one of the parties from keeping a material promise.

A typical such amnesty occurred if the lamb, ox or ass was eaten by a lion, or if an epidemic broke out. Because the occurrence of an act of God potentially extinguishes liability for a party in breach of a contract.

Several departments of the government have invoked Force Majeure provisions and have included Covid-19 incident as part of Force Majeure extending time for the performance of the contract. “I’m seeing most companies, hotels and banquet facilities giving refunds. The Parties are articulating that the delay or non-performance of the contract is completely unintended and involuntary, making them eligible to avoid immediate performance or any other liability arising from the contractual obligations. For a pandemic to be included under the clause of Act of God, it has to be proved that it was originated from nature and without any human intervention. Breaches of contract will be rife during these unprecedented times, with litigation likely to soon follow if the parties cannot come to a resolution before a lawsuit is filed.

Western civilization distinguishes itself from its Near Eastern predecessors in the way it has responded to “acts of God” that disrupt the means of support and leave debts in their wake. America is seeing the end of the home ownership boom that endowed its middle class with property steadily rising in price. In some situations, however, the parties will not be able to do so and legal action will need to be taken. Money can be created to finance the material economy, labor and industry, construction and agriculture.

§48 of Hammurabi’s laws proclaim a debt and tax amnesty for cultivators if Adad the Storm God had flooded their fields, or if their crops failed as a result of pests or drought. Canada and many European governments are subsidizing businesses to pay up to 80 percent of employee wages even though many must stay home. It can suspend scheduled debt service, taxes, rents and public fees from having to be paid by troubled areas of its economy, because China’s government is the ultimate creditor.

It really does come down to the agreement.”. Such external forces can be termed as "ACT OF GOD" (Vis Major/Superior Force).

These outcomes are not necessary. But of course there is, and always has been. This is because both parties are attempting (or should be) attempting to word the clauses to be as beneficial as possible, within the confines of the appropriate legal limitations, to them and their business.

Maryland courts follow the objective law of contracts. You can also contact information@pklaw.com for assistance. COVID-19 may fall squarely into a force majeure clause, which might include certain events beyond any of the party’s control like pandemics, epidemics, and quarantines, but the analysis does not end there. “They have to leave flexibility for what we can’t even contemplate,” she said. A moratorium on evictions put them off until August or September 2020. Having given $10 trillion dollars to support financial and mortgage markets, neoliberals in both the Republican and Democratic parties announced that the government had created so large a budget deficit as a result of bailing out the banking and landlord class that it lacked any more room for money creation for actual social spending programs. However, COVID-19 is not an act of God in the legal sense because human forces (interaction with others) have caused the worldwide spread of the virus. The ale woman likewise was freed from having to pay for the ale she had received from palace or temples for sale during the crop year. This is a question about interpreting terms of a contract. Past government policy would have restored prosperity by public spending programs to rebuild the roads and bridges, trains and subways that have fallen apart. § 13-4-21, specifically invoking “act of God” in the statutory language: “[i]f performance of the terms of a contract becomes impossible as a result of an ‘act of God,’ such impossibility shall excuse nonperformance, except where, by proper prudence, such impossibility might have been avoided by the promisor.”  Such excuse shall be continued so long as the condition constituting force majeure continues.

The impracticability defense is similar to the impossibility defense but is invoked when an unanticipated circumstance has made performance of the contractual promise vitally different from what should reasonably have been within the contemplation of both parties when they entered into the contract.

From the palace’s point of view as tax collector and seller of many key goods and services, the alternative would have been for debtors to owe their crops, labor and even liberty to their creditors, not to the palace.