The blockage has caused shockwaves across the economy. People`s ability to spend money is not what it used to be. This has also increased considerably on the relationship between owners and owners. While tenants` rental capacity has been affected, the profitability of landlords has also been disrupted. Tenants are asking for a rent waiver because they were unable to access their premises or because their income was affected. It is widely accepted that, in the absence of a force majeure clause, the appearance of COVID-19 can be regarded as an event that has made it impossible or unenforceable to carry out the obligations arising from the lease; the contract is therefore “frustrated” within the meaning of Section 56 of the Contracts Act. If included in a lease agreement, force majeure clauses are analyzed in accordance with the principles of interpretation in accordance with the contract. As a result, the courts have historically imposed the clear importance of the clause in the written form. In other words, the performance of contractual obligations, which are or are paid for, depends on the language of the clause. As with any other contractual provision, the courts seek to obtain the intent of the parties in the interpretation of the clause. However, the Pennsylvania jurisprudence has narrowly interpreted the force majeure clauses and even though the contracts contain such a clause, the party seeking protection bears the weight of the evidence that the event that led to non-compliance was beyond its control.
The Pennsylvania courts have required that the force majeure event be outside the party`s control area and not be attributable to misconduct or negligence by the non-compliant party. This may be a “heavy elevator” for tenants who have not paid rent, since the courts have generally found that non-performance, due to economic difficulties, alone is not sufficient to make a force majeure clause to excuse non-compliance. It is not surprising that in Pennsylvania there are more cases where alleged cases of force majeure are not covered by a force majeure clause than cases where it is established that a party is protected by such a clause. Force majeure clauses are also called “Act of God” clauses. You can excuse people or companies that make contracts to do what they promised, such as paying rent. The court, in light of this, refused discharge for a tenant who applied for the suspension of the rent because of COVID-19 and the resulting blockage. Rental facilities due to a force majeure event can only be used if such relief is expressly provided under the lease agreement. Generally, rental agreements excuse tenants from paying rent during a force majeure event, if damage or destruction of the property that leads to its unavailability for use by the taker, and they do not offer a lump sum waiver of rent payment in any force majeure event. Since force majeure is a contractual right, the explicit terms of the clause must be carefully considered and the lessor cannot legitimately invoke non-payment on the basis of force majeure in the absence of a maintenance clause and/or a specific waiver of the agreed lease. If the rental agreement provides for the cancellation of the rent or the suspension of all obligations during a period of force majeure without qualification or driver, the tenant should make immediate use of his right by sending a letter to the lessor on the basis of the force majeure event and ending his obligation to pay the rent during the period during which the force majeure event continues.