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Disaster Recovery Agreements Require Tailored Force Majeure Clauses

In disaster recovery agreements, do not negate the purpose of the contract by including overly broad force majeure provisions. With the coronavirus pandemic, force majeure clauses, which allow parties to get out of contracts due to events they cannot control, have received more attention and become more scrutinized. A disaster recovery agreement is designed to activate and protect a company’s critical operations, including software and digital systems, when a company experiences what could be a devastating event. The paradox is that this is often the same type of event for which a force majeure clause would allow the vendor to terminate the contract. A broad force majeure clause would nullify the purpose of the disaster recovery provisions. Because of this, any agreement in which the vendor is required to provide disaster recovery and business continuity services should only include force majeure language tailored so the provision does not apply to problems for which the vendor should be providing recovery solutions. Look carefully at what events constitute a “disaster” and what events are included in the definition of force majeure, and make sure they are in sync for the purposes of the agreement.

Ned T. Himmelrich
410-576-4171 • nhimmelrich@gfrlaw.com

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