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Force Majeure in Mississippi

What many states call a “force majeure” clause is often called an “Act of God” clause in Mississippi. In contracts for services and contracts for real estate, contractual force majeure/Act of God clauses are enforceable, but there is no Act of God defense absent a contractual clause.

This is not the case for contracts for the sale of goods. Unlike with other states, Mississippi’s version of the Uniform Commercial Code (UCC or the Code) specifically addresses force majeure. Mississippi Code § 75-2-617 provides:

Deliveries may be suspended by either party in case of Act of God, war, riots, fire, explosion, flood, strike, lockout, injunction, inability to obtain fuel, power, raw materials, labor, containers, or transportation facilities, accident, breakage of machinery or apparatus, national defense requirements, or any cause beyond the control of such party, preventing the manufacture, shipment, acceptance, or consumption of a shipment of the goods or of a material upon which the manufacture of the goods is dependent. If, because of any such circumstance, seller is unable to supply the total demand for the goods, seller may allocate its available supply among itself and all of its customers, including those not under contract, in an equitable manner. Such deliveries so suspended shall be cancelled without liability, but the contract shall otherwise remain unaffected.

Importantly, this provision applies only to the seller — not the buyer — of goods. So even if a contract for the sale of goods does not contain a force majeure clause, Mississippi law reads one into the contract for the seller.

There are no Mississippi cases interpreting whether a pandemic is an Act of God or a “cause beyond the control” of the seller. In fact, there are only three cases addressing this Code section at all. Two applied the statute, one to drought and another to machinery breakage. Sellers may have a good argument that this pandemic was at least as beyond their control as a machine breaking. But in the third case, the court refused to apply Mississippi’s force majeure statute to a take-or-pay contract, holding that parties contracted to allocate the risk by making the contract take-or-pay. This case may give a party looking to avoid the effects of Mississippi Code § 75-2-617 an argument that the parties’ contractual risk allocation should control over the statute.

Mississippi, like other states, has enacted UCC § 2-615 and § 2-616 on impracticability of performance, a concept similar to force majeure. There is no case law in Mississippi on either: given Mississippi’s direct force majeure statute, Mississippi businesses have relied on it rather than impracticability.

Unprecedented times are why force majeure clauses exist. For sellers of goods in Mississippi, the UCC may protect sellers even if the contracting parties did not include a force majeure clause in their contract.

© 2020 Jones Walker LLP

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About this Author

Adam Stone, Business and Commercial Litigation Attorney, Jones Walker, Law firm
Partner

Adam Stone is a partner in the firm’s Business & Commercial Litigation Practice Group and practices from the firm’s Jackson office. Mr. Stone has represented lenders, financial institutions, mortgage servicers, insurers, and trusts in a variety of class actions, state and federal suits, and arbitrations involving TILA, RESPA, FDCPA, UCC warranty claims, wrongful foreclosure claims, bad faith, and state law lender-liability claims, and he has presented on RESPA compliance issues to the Mississippi Bankers’ Compliance Task Force. Through his representation of these...

601-949-4717
Kaytie Pickett, Business and Commercial Litigation Attorney, Jones Walker, Law Firm
Partner

Kaytie Pickett is a partner in the firm's Business & Commercial Litigation Practice Group and practices from the Jackson office. Ms. Pickett focuses her practice in the areas of commercial litigation, real property litigation, construction law, and appellate law. Before joining the firm, she served as a law clerk to the Honorable Rhesa H. Barksdale of the U.S. Court of Appeals for the Fifth Circuit.

Ms. Pickett is a 2009 graduate of the Mississippi College School of Law, where she received her juris doctor degree, summa cum laude, served as Articles Editor of the Mississippi College Law Review, and received Best Oralist and Best Brief awards at the ABA Regional Appellate Advocacy Competition. She received numerous academic awards in law school, including the Dean’s Special Achievement Award, as well as American Jurisprudence awards for the highest grade in 17 classes.

Ms. Pickett is a 2002 graduate of Tulane University, where she received her Bachelor of Arts in English, cum laude. She is also a 2003 alumna of Teach for America. Ms. Pickett has served as a professor of Appellate Advocacy at the Mississippi College School of Law.

601-709-3344