A force majeure clause in a commercial lease excuses a party from performing obligations it is prevented from performing by events outside its control, such as government orders, natural disaster, war or labor stoppage. In most US commercial leases it does not excuse rent, because the clause carves monetary obligations out. Whether yours does is a question of wording, and the wording varies more than people expect.
That last point is the one worth sitting with. Force majeure is not a doctrine that floats above the lease and applies uniformly. It is a negotiated paragraph, and courts in the United States enforce it as written. Two tenants in the same shopping center, hit by the same government shutdown on the same day, can get opposite answers because one lease listed "governmental action" and the other did not.
The 2020 shutdowns produced the first large body of American case law on this, and the results were not uniform. Most tenants lost. A few won. The ones who won had specific language on their side. Below is what that language looks like, what courts actually did with it, and what to pull out of the clause when you are abstracting a portfolio.
What is a force majeure clause in a commercial lease?
A force majeure clause suspends a party's obligation to perform for as long as a listed event prevents, delays or hinders that performance. It has three working parts: the list of triggering events, the scope of what is excused, and the carve-outs that survive no matter what. A typical clause runs a sentence or two and is buried in the miscellaneous provisions near the back of the lease, which is exactly why it goes unread until the week somebody needs it.
The clause matters more than the common law behind it. In most states a force majeure provision displaces the common law doctrines of impossibility and frustration of purpose for the events it addresses. Once the parties have written down how they allocate the risk of a hurricane or a government order, courts generally hold them to that allocation rather than importing a default rule.
The three parts, in plain terms
| Part of the clause | What it does | What to watch for |
|---|---|---|
| Triggering events | The enumerated list: acts of God, fire, flood, war, terrorism, strikes, shortages of labor or materials, governmental action, orders of government | Whether "governmental action" or "orders of government" appears at all, and whether the list ends with a catch-all for other causes beyond reasonable control |
| Scope of excuse | Which obligations are suspended, and for how long. Usually "only so long as" performance is prevented | Whether it is mutual (both parties) or one-sided, and whether it suspends or terminates |
| Carve-outs | What is never excused. Almost always the payment of rent, often stated as "lack of money shall not be grounds for force majeure" | Whether the carve-out names rent specifically or only says lack of funds. Those are not the same thing, and one case turned on exactly that difference |
Does force majeure excuse rent in a commercial lease?
Usually no. The great majority of US commercial leases carve monetary obligations out of the force majeure clause, so a tenant who cannot operate still owes rent. Courts have consistently enforced those carve-outs against sophisticated parties. But where the clause lists governmental action as a trigger and the carve-out only says lack of money is not force majeure, at least one court has held the tenant partially excused.
That case is worth knowing in detail, because it is the clearest American example of a force majeure clause actually reducing rent, and because the reasoning is transferable.
In re Hitz Restaurant Group: the clause that worked
In In re Hitz Restaurant Group, 616 B.R. 374 (Bankr. N.D. Ill. 2020), Judge Donald Cassling considered a Chicago restaurant lease whose force majeure clause read, in the court's own quotation of it:
Landlord and Tenant shall each be excused from performing its obligations or undertakings provided in this Lease, in the event, but only so long as the performance of any of its obligations are prevented or delayed, retarded or hindered by. . . laws, governmental action or inaction, orders of government. . . . Lack of money shall not be grounds for Force Majeure.
The tenant argued that Illinois Executive Order 2020-7, which suspended on-premises dining from March 16, 2020, triggered the clause. The landlord argued three ways around it. The court worked through each and reached four conclusions that are useful well beyond this one restaurant.
- March rent was still owed in full. The March payment became due on March 1, and the executive order took effect two weeks later. A force majeure clause excuses performance from the moment the event prevents it, not retroactively. Timing of the due date against the event date decides the first month.
- The order was governmental action, and it was the proximate cause. The court found the executive order "unquestionably constitutes both governmental action and issuance of an order as contemplated by the language of the clause," and that it hindered performance by prohibiting on-premises consumption. Illinois law requires the triggering event to be the proximate cause of the nonperformance, and here it was.
- The "lack of money" carve-out did not defeat the claim. This is the pivotal holding. The landlord argued the carve-out killed the whole argument, since the tenant's problem was that it lacked money. The court disagreed on a rule of construction: a lack of money could arise from any number of causes, while the specific provision about governmental orders addressed this exact situation, and the more specific provision prevails over the more general one. The court cited Aeroground, Inc. v. CenterPoint Properties Trust, 738 F.3d 810 (7th Cir. 2013) for that principle.
- The excuse was partial, and it was measured by square footage. The executive order permitted carry-out, curbside pickup and delivery. The tenant conceded that 25 percent of the restaurant's square footage, the kitchen, remained usable for those purposes. The court held the tenant still owed at least 25 percent of the rent for April, May and June 2020, and noted the figure was likely to rise as restrictions lifted.
Read that fourth point again, because it is the practical lesson. Force majeure is not binary. A court can prorate it against how much of the premises stayed usable. If you are the tenant, the square footage still in service is the number you will be arguing about. If you are the landlord, it is the number you want documented early.
Why did most tenants lose their force majeure cases?
Because their leases said rent was not excused. Where a commercial lease expressly states that force majeure does not relieve the tenant of the obligation to pay rent, courts have enforced that language as written, treating it as a deliberate allocation of financial risk between sophisticated parties. Hitz is the exception that proves the drafting point rather than a general rule that shutdowns abate rent.
The pattern across the 2020 and 2021 decisions is consistent. Where the clause was silent on money, tenants had an argument. Where the clause named rent, they did not. Where there was no force majeure clause at all, tenants fell back on impossibility and frustration of purpose and mostly lost those too, because the premises remained physically available and the tenant's business difficulty was not the same as impossibility of performance.
What is the difference between force majeure and a casualty clause?
A casualty clause deals with physical damage to the premises and typically provides for rent abatement while the space is untenantable, plus termination rights if restoration will take too long. A force majeure clause deals with events that prevent performance without necessarily damaging anything. A fire triggers both. A government shutdown order triggers only force majeure, because the building is fine.
This distinction gets blurred constantly, and blurring it costs money. A tenant whose space burned should be looking at the abatement machinery in the casualty and condemnation clause, which is written to handle exactly that and usually does abate rent. Force majeure is the wrong tool for that job and will generally produce a worse answer. Conversely, a tenant closed by government order has no casualty to point to and force majeure is the only clause in play.
| Force majeure | Casualty clause | Condemnation clause | |
|---|---|---|---|
| Trigger | Event preventing performance | Physical damage or destruction | Government taking of the property |
| Typical rent effect | Usually none, rent is carved out | Abatement while untenantable | Abatement or termination on a total taking |
| Termination right | Rare, and only in longer clauses | Yes, if restoration exceeds a stated period | Yes, on a total or substantial taking |
| Insurance behind it | None directly | Property and business interruption | The condemnation award |
What events are usually listed in a force majeure clause?
The standard American commercial lease list runs: acts of God, fire, flood, earthquake, war, terrorism, riot or civil disturbance, strikes and labor disputes, shortages of labor or materials, and governmental action, inaction or orders. Most clauses close with a catch-all for other causes beyond the reasonable control of the performing party. Post-2020 drafts increasingly add epidemic, pandemic, quarantine and public health emergency by name.
Two drafting details decide whether the list works. First, whether the catch-all is genuinely open or is narrowed by a phrase like "of a similar nature to the foregoing," which courts read as limiting the catch-all to the kinds of events already listed. Second, whether the clause requires notice, and how fast. A clause that says the affected party must give written notice within ten days of the event is a deadline that has to be tracked, and it is a deadline tenants have blown.
Does a force majeure clause require notice?
Many do. A common formulation requires the party claiming force majeure to give the other party written notice within a stated period, often five to thirty days after the event, describing the event and the obligations affected. Where notice is a condition of the excuse, missing the deadline can forfeit the claim entirely, regardless of how clearly the event fits the list.
This is the part that belongs in an obligation register rather than a file drawer. Notice periods for force majeure sit alongside renewal notice windows, termination option deadlines and estoppel response periods, and they have the same failure mode: nobody remembers a deadline that only becomes relevant during a crisis. When you abstract a lease, this date field is worth capturing even though most years it will never fire. Our lease critical dates checklist covers how the rest of that calendar gets built.
How should force majeure be handled during lease abstraction?
Capture five things: whether the clause exists at all, the enumerated events with attention to governmental action and pandemic language, whether rent is expressly carved out, whether notice is required and within what window, and whether the clause is mutual or runs only in the landlord's favor. Those five fields let you answer a portfolio-wide question in an afternoon instead of a month.
The portfolio-wide question is the one that matters. When something happens, the general counsel does not want to know about one lease. They want to know how many of the 340 leases have governmental action in the trigger list, how many carve out rent, and which ones have a notice deadline running right now. That is not a legal question, it is a data question, and it is only answerable if somebody extracted the clause text into a comparable field before the event. Reading 340 leases after the fact is how organizations discover they missed a notice window in lease 200-something.
Boilerplate provisions are exactly where manual abstraction gets lazy, because they look identical until they are not. An abstractor working through a stack under time pressure will read the rent schedule carefully and skim the miscellaneous section. That is understandable and it is also where the exposure hides. AI abstraction has an advantage here that has nothing to do with intelligence and everything to do with stamina: it reads the boilerplate in the four hundredth lease with the same attention as the first, and links each extracted field back to the clause it came from so a reviewer can confirm it in seconds.
What to record, and why
| Field | Values you will actually see | Why it matters |
|---|---|---|
| Clause present | Yes, no | Absence pushes the parties to impossibility and frustration, which are harder arguments |
| Governmental action listed | Yes, no, catch-all only | The single field that decided Hitz |
| Pandemic or epidemic named | Yes, no | Common in post-2020 leases, rare before |
| Rent carve-out | Rent expressly excluded, lack of money only, silent | "Lack of money only" is materially weaker than naming rent, which is the whole holding in Hitz |
| Notice requirement | Days, form, to whom | A condition precedent you can forfeit by missing |
| Mutual or one-sided | Both parties, landlord only | One-sided clauses are common and worth flagging in diligence |
What should a tenant negotiate into a force majeure clause?
Realistically, four things. Make the clause mutual so the landlord's construction and delivery obligations are covered by the same standard. Get pandemic, epidemic and public health orders named explicitly rather than relying on a catch-all. Push the notice window out to something a business in crisis can actually meet, twenty or thirty days rather than five. And if the landlord will not abate rent, negotiate a defined outside date after which extended force majeure gives either party a termination right.
Landlords resist the rent point hardest, and they usually win it, because the mortgage on the building does not pause. That is a real argument rather than a negotiating posture. Where tenants have had more success since 2020 is on the termination backstop: not rent relief during the event, but an exit if the event runs past a defined period. It is a narrower ask and it lands better.
One accounting footnote. If you do end up with a partial abatement of the kind Hitz produced, the tail is longer than the event. Months of rent charged at one figure and paid at another leave an aging schedule that somebody has to reconcile line by line against what actually cleared, and under ASC 842 a negotiated rent concession may be a lease modification requiring remeasurement rather than a simple credit. Decide which it is before the close, not during the audit.
Is force majeure the same as frustration of purpose?
No. Force majeure is a contract term the parties wrote. Frustration of purpose is a common law doctrine that can excuse performance when an unforeseen event destroys the fundamental purpose of the contract, and it applies only where the contract has not already allocated that risk. Because a force majeure clause is precisely such an allocation, its presence usually forecloses the common law argument for the events it covers.
Tenants without a force majeure clause tried frustration of purpose in 2020 and mostly lost, because courts held that a downturn in business, even a severe one caused by law, is not the same as the destruction of the lease's purpose when the premises remain available and the tenant retains possession. The doctrine is real but the bar is high, and it is not a substitute for having the clause.
Getting this into your lease data
Force majeure will not be the field that justifies an abstraction project. Rent, dates and options do that. But it is one of a handful of provisions where the cost of not having the data is concentrated into a few very bad weeks, and where the answer has to be portfolio-wide to be worth anything.
Leaseabstracts reads the executed lease and every amendment, extracts the clause set including the miscellaneous provisions most abstracts skip, and links each field to the page and clause it came from. If you want to see what that looks like on the clauses that carry more weight day to day, the guides on the assignment and subletting clause and the early termination clause work through the same exercise, and lease abstraction for law firms covers the diligence workflow these fields feed.