What Is an Impracticability Clause in a Contract?

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The legal doctrine of impracticability is typically used as a defense in a breach of contract case. Commercial impracticability is used for highly unusual situations in which both parties in the contract could not have reasonably expected to occur. Well-drafted contracts will include a force majeure clause, which essentially protects the risk of loss if performance agreed upon in the contract is hindered, delayed, or prevented because an unanticipated event. A great example of this is a pandemic. When COVID-19 occurred, several contracts could not be carried out due to various factors, such as closing of establishments or delays due to shortage of staff. This, of course, was an unexpected event for which no party to a contract could have predicted.

What Is the Difference Between Impossibility and Impracticability?

When an obligation is impossible to perform, as in it cannot be accomplished by any means, it is considered legally “impossible.” The Florida Court system generally has an interest in holding parties to the contract they sign, and the duties assigned under that contract, but when an obligation becomes impossible, then that is when a party can be relieved of this obligation. For example, if a music group is hired to perform at a specific venue, and the venue is burned down, it would be impossible for the music group to perform in the venue.

If the duty requires extreme and unreasonable difficulty, expense, injury, or loss, this is when it is considered “impracticable.” These are usually referred to as “acts of God” such as earthquakes, floods, fires, hurricanes, or pandemics that make the duty unreasonably difficult to pursue. In Florida, the scope of this clause is greater than the scope of impossibility. Unlike many states, Florida does not limit the impracticality clauses to only unforeseeable events.

How Can You Tell If the Event Is Impossible or Impractical?

Depending on ability to perform the obligation, the obligation will either be labeled as impossible or impractical. The triggering event that helps classify an obligation as impossible or impractical is that for a performance to be impossible, it cannot physically be performed. On the other hand, when an obligation is impractical, it can be performed, but it would be an extreme burden or come with a great expense to the performing party. For example, back to the music venue, if the venue completely burned down, it would be physically impossible for the music group to perform there. On the other hand, if the music venue had simply flooded, but the flooding ruined all the electrical outlets and lights, it would not be physically impossible to perform at this venue, but it would be extremely impractical as the music group could not properly perform without electricity. 

EPGD Business Law is located in beautiful Coral Gables, West Palm Beach and historic Washington D.C. Call us at (786) 837-6787, or contact us through the website to schedule a consultation.

*Disclaimer: this blog post is not intended to be legal advice. We highly recommend speaking to an attorney if you have any legal concerns. Contacting us through our website does not establish an attorney-client relationship.*

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