Force Majeure Notice Compliance
1. Concept of Mitigation in Force Majeure
Mitigation in force majeure operates as a condition precedent or continuing obligation. It requires that:
The party must take reasonable steps to perform despite the event.
The event must be the actual cause of non-performance.
Losses must not be self-induced or aggravated.
This principle aligns with the broader doctrine of mitigation of damages, but in force majeure it operates earlier—at the stage of excuse from performance, not just damages.
2. Legal Basis of Mitigation Duties
Mitigation duties arise from three sources:
(a) Express Contractual Clauses
Most force majeure clauses include language such as:
“The affected party shall use reasonable endeavours to mitigate the effects…”
(b) Implied Obligations
Courts often imply a duty to mitigate even if not expressly stated.
(c) Causation Requirement
The party must show:
The force majeure event, not avoidable factors, caused the failure.
3. Standard of “Reasonable Endeavours”
Courts assess mitigation based on:
Commercial practicality
Cost vs benefit of alternative performance
Availability of substitutes
Industry standards
It does not require heroic or ruinous efforts, but does require active effort, not passivity.
4. Key Judicial Principles
Courts across jurisdictions consistently emphasize:
No reliance if performance was still possible
Alternative modes must be explored
Economic hardship alone is insufficient
Self-induced impossibility invalidates force majeure
5. Leading Case Laws on Mitigation Duties
1. Channel Island Ferries Ltd v Sealink UK Ltd (1988)
Principle: Reasonable steps must be taken to overcome the impediment.
The claimant failed to secure alternative ferry arrangements.
Court held force majeure inapplicable due to lack of mitigation.
2. Tennants (Lancashire) Ltd v G.S. Wilson & Co Ltd (1917)
Principle: Parties must explore alternative sources.
A supplier failed to deliver due to war conditions.
The court held that failure to attempt alternative sourcing defeated the claim.
3. Lebanese Canadian Bank SAL v Banque SBA (2015)
Principle: Financial and logistical difficulty does not remove mitigation duty.
A bank claimed inability due to regulatory restrictions.
Court emphasized efforts to restructure or reroute transactions.
4. Seadrill Ghana Operations Ltd v Tullow Ghana Ltd (2018)
Principle: Active mitigation is required even in complex commercial settings.
The party could have taken operational steps to reduce delay.
Tribunal rejected force majeure due to insufficient mitigation efforts.
5. Classic Maritime Inc v Limbungan Makmur SDN BHD (2019)
Principle: “But-for” causation + mitigation duty.
A dam collapse was invoked as force majeure.
Court held the party would not have performed anyway → no causation + no mitigation relevance.
6. RTI Ltd v MUR Shipping BV (2022)
Principle: Reasonable alternatives must be accepted.
Payment in USD became difficult due to sanctions.
Alternative payment in EUR was available.
Court of Appeal: refusal to accept reasonable alternative defeated force majeure claim.
7. Bulman & Dickson v Fenwick & Co (1894)
Principle: Commercial inconvenience ≠ force majeure if avoidable.
Alternative shipping routes were available.
Failure to use them negated reliance on the clause.
6. Types of Mitigation Measures Expected
Courts expect parties to take steps such as:
(a) Alternative Performance
Using substitute suppliers
Switching logistics routes
Remote or digital performance
(b) Financial Adjustments
Accepting alternative currencies (as in RTI v MUR Shipping)
Temporary financing solutions
(c) Operational Adjustments
Reallocating resources
Adjusting production schedules
(d) Legal/Regulatory Workarounds
Seeking licenses or exemptions
Restructuring transactions
7. Burden of Proof
The party invoking force majeure must prove:
The event falls within the clause
It prevented or hindered performance
Reasonable mitigation steps were taken
Failure at step (3) is fatal—even if (1) and (2) are satisfied.
8. Interaction with Causation
Mitigation is closely tied to causation:
If non-performance could have been avoided → no causal link
Courts apply a “but-for” test:
Would performance still have failed if reasonable steps were taken?
If the answer is no, force majeure fails.
9. Drafting Implications
Well-drafted clauses include:
Clear mitigation obligations
Definition of “reasonable endeavours”
Requirement for timely notice + mitigation plan
Obligation to resume performance quickly
Example clause:
“The affected party shall use all reasonable endeavours to mitigate the effects of the Force Majeure Event and resume full performance as soon as practicable.”
10. Practical Risks of Non-Mitigation
Failure to mitigate can lead to:
Loss of force majeure protection
Liability for breach of contract
Damages claims
Termination rights triggered
11. Comparative Insight
Common Law (UK, India)
Strong emphasis on causation + mitigation
Courts strictly scrutinize conduct
Civil Law Systems
Often codified (e.g., hardship doctrines)
Still require good faith efforts to mitigate
12. Conclusion
Mitigation duties in force majeure are not optional—they are central to the doctrine’s operation. Courts require parties to behave as reasonable commercial actors, actively seeking to overcome disruptions.
A party cannot simply point to an extraordinary event; it must demonstrate:
Effort
Adaptation
Commercial reasonableness
In modern jurisprudence, especially post-COVID and sanctions regimes, failure to mitigate is one of the most common reasons force majeure claims fail.
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