Will this force majeure clause excuse performance in Illinois?
For a seller of goods, Illinois has the uniform statutory excuse, which by its opening line applies 'Except so far as a seller may have assumed a greater obligation and subject to the preceding section on substituted performance': delay or non-delivery is not a breach if performance as agreed has been made impracticable by the occurrence of a contingency the non-occurrence of which was a basic assumption on which the contract was made, or by compliance in good faith with any applicable foreign or domestic governmental regulation or order 'whether or not it later proves to be invalid', provided the seller allocates production fairly among customers and seasonably notifies the buyer (810 ILCS 5/2-615). No Illinois decision construing a force majeure CLAUSE is quoted here. The "preceding section" it yields to requires a commercially reasonable substitute to be tendered and accepted where agreed facilities, carriers or the manner of delivery fail (810 ILCS 5/2-614(1)); its second subsection is a payment rule a force majeure clause rarely reaches, for if the agreed means or manner of payment fails because of domestic or foreign governmental regulation the seller may withhold or stop delivery unless the buyer provides a commercially substantially equivalent substitute, and once delivery has been taken payment in the manner the regulation provides discharges the buyer "unless the regulation is discriminatory, oppressive or predatory" (§ 2-614(2)); and the section after it gives the buyer the election, by written notification to the seller as to any delivery concerned, and, where the prospective deficiency substantially impairs the value of the whole contract under the installment-contract provisions (§ 2-612), as to the whole: on notice of a material or indefinite delay or an allocation, to terminate the unexecuted portion or take the quota in substitution; silence for a reasonable time not exceeding 30 days lapses the affected deliveries; and that section "may not be negated by agreement" except where the seller has assumed a greater obligation (810 ILCS 5/2-616).
The trap
Section 2-615 is a default for sellers, not a reading of the parties' clause (its own text yields where the seller 'may have assumed a greater obligation'), and it comes with duties the clause usually omits: fair and reasonable allocation among customers, and seasonable notice of the delay and of the buyer's estimated quota. Outside Article 2 the Illinois rule is unread rather than absent, and the honest statement is a measured one: across Illinois case law 17 opinions contain the phrase force majeure in lower case and 3 more contain it capitalised (the capitalised-first-word spelling returns none), and every one of the nine the scan listed by name is an Appellate Court decision, among them 55 Jackson Acquisition v. Roti Restaurants (2022), Wermers Floorcovering v. Santanna Natural Gas (2003) and Schawk v. Donruss Trading Cards (2001). Not one of the twenty has been read, so how an Illinois court construes a force majeure list, a catch-all naming causes and then adding others of the same kind, or an epidemic or government-order clause is not stated here; what cannot be said is that there is nothing to find.
5 authorities
- statute810 ILCS 5/2-615enactment date not established
The words that state the rule
Except so far as a seller may have assumed a greater obligation and subject to the preceding section on substituted performance: (a) Delay in delivery or non-delivery in whole or in part by a seller who complies with paragraphs (b) and (c) is not a breach of his duty under a contract for sale if performance as agreed has been made impracticable by the occurrence of a contingency the non-occurrence of which was a basic assumption on which the contract was made or by compliance in good faith with any applicable foreign or domestic governmental regulation or order whether or not it later proves to be invalid.
- statute810 ILCS 5/2-615enactment date not established
The words that state the rule
(b) Where the causes mentioned in paragraph (a) affect only a part of the seller's capacity to perform, he must allocate production and deliveries among his customers but may at his option include regular customers not then under contract as well as his own requirements for further manufacture. He may so allocate in any manner which is fair and reasonable. (c) The seller must notify the buyer seasonably that there will be delay or non-delivery and, when allocation is required under paragraph (b), of the estimated quota thus made available for the buyer.
- statute810 ILCS 5/2-614enactment date not established
The words that state the rule
(1) Where without fault of either party the agreed berthing, loading, or unloading facilities fail or an agreed type of carrier becomes unavailable or the agreed manner of delivery otherwise becomes commercially impracticable but a commercially reasonable substitute is available, such substitute performance must be tendered and accepted.
- statute810 ILCS 5/2-616enactment date not established
The words that state the rule
(1) Where the buyer receives notification of a material or indefinite delay or an allocation justified under the preceding section he may by written notification to the seller as to any delivery concerned, and where the prospective deficiency substantially impairs the value of the whole contract under the provisions of this Article relating to breach of installment contracts (Section 2-612), then also as to the whole, (a) terminate and thereby discharge any unexecuted portion of the contract; or (b) modify the contract by agreeing to take his available quota in substitution. (2) If after receipt of such notification from the seller the buyer fails so to modify the contract within a reasonable time not exceeding 30 days the contract lapses with respect to any deliveries affected. (3) The provisions of this Section may not be negated by agreement except in so far as the seller has assumed a greater obligation under the preceding section.
- statute810 ILCS 5/2-614enactment date not established
The words that state the rule
(2) If the agreed means or manner of payment fails because of domestic or foreign governmental regulation, the seller may withhold or stop delivery unless the buyer provides a means or manner of payment which is commercially a substantial equivalent. If delivery has already been taken, payment by the means or in the manner provided by the regulation discharges the buyer's obligation unless the regulation is discriminatory, oppressive or predatory.
“Defective” means that reading found something to correct. What you are reading is the rule as it stands after that reading.