In the wake of the Russian invasion of Ukraine and economic sanctions imposed by countries around the world in response, supply chain disruptions and the resulting scarcity of construction have resulted in price escalation that threatens construction project budgets. To allocate the risk of these sorts of cost increases, project owners and contractors may use targeted contract provisions like material price escalation clauses. But more common is the “force majeure” clause, which generally addresses the assignment of risk due to unforeseeable events beyond the parties’ control. In my first column for the Daily Journal of Commerce, I explore some of the considerations for owners and contractors assessing whether war-driven cost increases may qualify as force majeure events. You can read the full article here.
Originally published as an Op-Ed by the Oregon Daily Journal of Commerce on May 19, 2022.