UK Supreme Court Judgment on ‘Force Majeure Clause’

14 June 2024 No.1278

The UK Supreme Court, in a case concerning the application of a ‘force majeure clause’ containing the words ‘reasonable endeavours’, held that a party's obligation to use reasonable endeavours to overcome a force majeure event does not oblige it to accept an offer of non-contractual performance unless the contract contains specific wording to that effect.


The case is an interesting one in which a London arbitral tribunal’s decision was overturned by the English courts in the first instance, the first instance decision was overturned by the Court of Appeal and a further Court of Appeal decision was overturned by the Supreme Court. Please find the article on this judgment written by our Senior Legal Adviser William Turner.


The owners MUR Shipping BV and the charterers RTI Ltd signed a COA for the carriage of bauxite. The COA stipulated that the freight was to be paid in USD. The COA contained a ‘force majeure clause’, which provided that an event or state of affairs did not qualify as force majeure unless it could not be overcome by ‘reasonable endeavours’. During the performance of the COA, the charterers' parent company became subject to US sanctions and the charterers could no longer pay the freight in USD. The charterers offered to pay in EUR, but the owners refused to accept this and suspended the performance of the COA under a‘force majeure clause’. The charterers disputed that the owners could not rely on the ‘force majeure clause’because they had failed to make ‘reasonable endeavours’ to overcome the force majeure situation.