Meeting Mentor Magazine

June 2019

Is It Force Majeure If the Hurricane Doesn’t Hit After All?

Meeting industry attorney Joshua Grimes, Grimes Law Offices, hears this question a lot: Say a severe weather event, such as a hurricane or big blizzard, is being forecast for your upcoming meeting destination. People start canceling in the days leading up to your event, and it’s starting to look like it will be a washout. Then the weather clears, and it’s sunny skies ahead for your meeting — except for the fact that most of your attendees have canceled their plans to attend. What’s a planner to do?

The worst thing you can have in this sort of situation is a standard force majeure clause that only allows cancellation for illegality or impossibility, said Grimes. He cited an example of a meeting host that didn’t want to cancel a meeting in New Orleans in the days leading up to Hurricane Katrina because the clause didn’t allow cancellation before the hurricane actually hit. While the organization did get a reprieve when the government declared a mandatory evacuation of the area, you don’t want to depend on something like that happening.

“This is the reason why a good force majeure/excuse of performance clause should include the right to cancel not only because it’s impossible or illegal to hold the event, but also if it’s inadvisable or impractical,” said Grimes. “Using that type of language will allow a party to cancel if the threat of impending severe weather makes it impractical for the event to go forward, either because suppliers are not able to guarantee performance or because a certain predetermined number of attendees have canceled their registration.” You also would want to predetermine what level of cancellation would trigger the clause, he added. “It could be 30 percent, or it could be up to 50 percent. It’s whatever you negotiate.”

He also warns planners to watch for common clauses in force majeure provisions that put a time limit on when they can cancel without liability. “For example, it may say that, in order to exercise the force majeure right to cancel without liability, the party must act to exercise its right within, let’s say, 20 days of the date of the force majeure event. However, if a hurricane hits today, but your meeting is next June, that would mean the meeting party would have to cancel in December for an event that’s six months away.” As we have seen, when hurricanes powerful enough to knock out hotels and airports have hit destinations such as Puerto Rico and Cabo San Lucas, the venues frequently can come back on line within a few months. “If your clause requires you to cancel within a few days of the force majeure event, it forces you to make a decision without being able to determine if the hotel can come back in time to hold the meeting after all. That doesn’t do anyone any good,” said Grimes.

Would this apply in the case of, say, the deadly wildfires that ripped through parts of California this fall? Most likely the answer would be no, said Grimes, unless your meeting destination was directly affected by the fires. “The fire that decimated the Paradise community in northern California doesn’t necessarily mean you can’t meet in San Francisco,” he said. While your attendees may look at the news and think the entire state is on fire, the reality is, although “it might rise to the level of inadvisability if half your attendees want to cancel, it would be a very tough row to hoe. While the fires in Malibu were horrible, it would be hard to argue how it affects your ability to hold a meeting at the Staples Center or the Los Angeles Convention Center.” — Sue Pelletier

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About ConferenceDirect
ConferenceDirect is a global meetings solutions company offering site selection/contract negotiation, conference management, housing & registration services, mobile app technology and strategic meetings management solutions. It provides expertise to 2,500 corporations and associations through our 325 Associates globally. www.conferencedirect.com

About MeetingMentor
MeetingMentor, the leading publication for senior meeting planners, is circulated to the clients, prospects and sales associates of ConferenceDirect, which books more than 3.87 million room nights. www.meetingmentormag.com

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