Attorney Brian Tilker quoted in Hawaii Business Magazine article regarding impact of COVID-19 outbreak on business contracts

What is a force majeure clause? According to attorney Brian Tilker at Torkildson, Katz, Hetherington, Harris & Knorek, Attorneys at Law, it's a provision included in business contracts that exempts businesses from contractual obligations for reasons pertaining to unavoidable, catastrophic circumstances.

We are currently experiencing an unavoidable, catastrophic circumstance. The novel coronavirus (COVID-19) has had such a devastating economic impact in Hawaii that many businesses may not be able to meet their contractual obligations.

Attorney Tilker discusses how businesses can take advantage of a force majeure clause and other major contractual defenses during the COVID-19 crisis in a Hawaii Business Magazine article. While pandemics and economic hardship may not be adequate enough to trigger such a clause, the actions taken by state and federal government may be.

He explained in an email to Hawaii Business Magazine:

“Hawaiʻi businesses that have been deemed nonessential by the government may have a viable argument that a force majeure event has occurred.”

Attorney Tilker adds that during a pandemic such as COVID-19, a force majeure clause may need to be determined on a case-by-case basis by analyzing the following:

  • The specific provision in a contract
  • The contractual obligations
  • The factual circumstances that impede a business's ability to fulfill its contractual obligations

If you're a business operating in Hawaii, contact our law firm for any questions regarding laws pertaining to non-essential businesses. You can also visit our COVID-19 resource library for more information.

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