Force Majeure – A Contractual Decoration Yet to Be Seen in My Court Practice

It is one thing for a contract to have that famous "force majeure" clause on its last page—as almost any contract does—and quite another to understand its true purpose;

Right from the start, it must be stated that force majeure, in its classic definition, is not found in the Georgian Civil Code. What exists is similar, but it does not serve as a ground for exemption from performing an obligation. "The contract must be performed" (Pacta sunt servanda) — this is the foundational thesis upon which the entire Georgian Civil Code stands. Consequently, when this thesis collides with force majeure, the latter takes a step back;

Force majeure does not mean that a party should be released from performing their obligations. The Civil Code does not recognize complete exemption from performance; moreover, it is full of provisions stating the exact opposite. In a scenario where force majeure contradicts a specific provision of the law, which one prevails? The answer is straightforward: court practice so far indicates that victory belongs to the law;

1. What does force majeure mean in its classic sense? - Not every circumstance can be considered force majeure. Furthermore, it only encompasses objective circumstances that do not depend on the will of the contracting parties and cannot be influenced by them. Such circumstances may include war, pandemics, epidemics, natural disasters, etc. During a force majeure event in the classic sense, the contracting parties do not perform their assumed obligations until these circumstances are over or until they no longer prevent either party from performing. Force majeure, meaning the deferral of the performance, is generally confined to a specific period and applies only to that timeframe;

2. What does force majeure mean under the Georgian Civil Code?
2.a) Article 398 of the Civil Code: The Georgian Civil Code does not directly recognize the concept of force majeure; rather, it is embodied in various theses within the Code's articles. Article 398 does not use this exact term but refers to it as the "Adaptation of the contract to changed circumstances," especially in its second part, which states: "If the circumstances that became the basis for the conclusion of the contract have significantly changed after its conclusion, and the parties would not have concluded this contract or would have concluded it with a different content had they taken these changes into account, then adaptation of the contract to the changed circumstances may be demanded. Otherwise, taking individual circumstances into account, strict adherence to the unmodified contract cannot be demanded from a party". Whether to "strictly adhere" or not is an evaluative category, and without factual context, its assessment remains purely theoretical. As for concluding the contract with "different content," this implies objective circumstances that occurred independently of the parties' will. The second and third parts of the article go further, equating a party's perceptions to a change in circumstances, and obliging the parties to adapt the contract to these new conditions. If adaptation is impossible, they have the right to refuse the contract. Here, too, the main thesis of the Civil Code is evident: the contract must be performed. Added to this is a secondary thesis—the Civil Code favors remaining in the contract rather than terminating or withdrawing from it.

2.b) Article 401 of the Civil Code: This article specifies that: "The term shall not be deemed overdue if the obligation was not performed due to circumstances not caused by the debtor's fault." This should not be misunderstood to mean that any minor issue excuses a missed deadline. Here, too, the Code emphasizes objective circumstances rather than just dry facts. Even this article speaks not of complete exemption from performance, but only of forgiving the delay for a specific period. Consequently, this concerns not the primary obligation itself, but the means of securing it. Specifically, it is presumed that lost income or penalties should not be imposed on the debtor if they can prove that exceptional circumstances took place (e.g., war, pandemic, natural disaster). Thus, a circumstance complicating performance does not remove the obligation to perform, but it extinguishes its accompanying penalties;

3.) Force Majeure and the Chamber of Commerce and Industry - In Georgia, there is the Law on the Georgian Chamber of Commerce and Industry. Article 3, paragraph 'l' of this law states that the Chamber certifies force majeure circumstances. Accordingly, determining whether force majeure circumstances existed or exist is solely the prerogative of the Chamber of Commerce and Industry. It is noteworthy that this law does not make a reservation regarding the Civil Code, nor does the Civil Code reference the Law on the Chamber of Commerce and Industry. While this might cause minor confusion, it gives the court full scope to define the existence or non-existence of force majeure through its practice. Whether the consent of the Chamber of Commerce and Industry is strictly necessary when applying the aforementioned articles of the Civil Code is a question that court practice must resolve. (It is worth noting that the only direct reference to "irresistible force" is found in Article 666, although it is not discussed here as it applies exclusively to tourism services, not the general section);

4.) Instead of a Summary - For the purposes of this article, the history, significance, and specific characteristics of force majeure have not been fully expanded upon. However, one thing is clear: force majeure in its classic meaning does not exist in the Georgian Civil Code. If a variation of it exists, it relates not to exemption from the performance of the obligation, but to its deferral or adaptation;