Knock on effects of Covid: force majeure and other contract sports
18 February 2022
European Professional Club Rugby sued RDA Television for the alleged wrongful repudiation of a contract to broadcast the 2018-22 European Rugby Champions Cup and the European Rugby Challenge Cup.
The force majeure clause in the contract provided that a party was not liable for delay or failure to perform its obligations caused by a “Force Majeure Event”, provided it used all reasonable endeavours to mitigate the delay or failure. The clause also entitled the unaffected party to terminate the contract if the Force Majeure Event prevented or delayed performance of the other party’s obligations for a continuous period of over 60 days. A Force Majeure Event was “any circumstance beyond the reasonable control of a party affecting the performance [...] of its obligations” including an “epidemic”. The parties agreed this included the Covid-19 pandemic.
Due to Covid-19 restrictions, many 2019-2020 ruby matches were postponed until the 2020-2021 season. In June 2020, 75 days after the first match was postponed, RDA notified EPCR it was terminating the contract under the force majeure clause.
EPCR claimed this was a repudiatory breach because RDA was affected by the same Force Majeure Event and therefore was required to use reasonable endeavours to mitigate its impact.
The court held that RDA could validly terminate the contract under the force majeure clause. The provision requiring a party to mitigate a Force Majeure Event’s impact did not affect the provision entitling a party to terminate. Further, the fact that RDA was affected in a general sense by the same Force Majeure Event did not prevent them from terminating. It would be commercially absurd to deprive RDA of the benefit of the termination provision where the contract only referred to a failure or delay in performance of the other party’s obligations.