Insights
March 06, 2026
Enforcing Force Majeure in the UAE: Practical Implications for Commercial Contracts and Property Transactions
The doctrine of force majeure safeguards the interests of contracting parties when events beyond their control materially affect contractual performance. It applies where performance becomes impossible due to unforeseen circumstances, often described as “Act of God,” reflected in the maxim Actus Dei nemini facit injuriam, meaning, no one should be held legally responsible for losses caused by natural or inevitable events that could not reasonably have been foreseen or prevented.
Contracting parties enjoy significant autonomy in defining how unforeseen events may impact obligations. Through carefully drafted provisions, they may specify circumstances under which obligations may be suspended, modified, or terminated. While such clauses provide flexibility, they remain subject to the overarching framework of the law and cannot override substantive legal principles.
Typically, force majeure clauses contain two key elements: (i) a definition of events that constitute force majeure, and (ii) the legal consequences, including suspension, extension of time, or termination. A well-drafted clause clarifies the scope of events, notification requirements, and remedies, reducing uncertainty and providing legal certainty when unforeseen events occur.
This becomes particularly relevant in real estate, property, and commercial transactions, where contractual commitments often involve significant financial obligations and strict timelines. Sale and Purchase Agreements (SPAs), Reservation Agreements, and Form F Contracts typically impose clear obligations on buyers and sellers to complete the transaction within a specified period. In circumstances where unforeseen events affect the ability of a party to complete the transfer, make payment, or fulfil conditions precedent, questions frequently arise as to whether such events can legally justify suspension or termination of the transaction.
Statutory Framework Under the UAE Civil Code:
While contracts often contain express force majeure clauses regulating the consequences of unforeseen events, the legal framework governing such circumstances in the UAE is also rooted in the Federal Law No. 5 of 1985 On the Civil Transactions Law of the UAE (“Civil Code”) . These statutory provisions form part of the broader legal regime governing contractual obligations. Contractual provisions operate alongside, and must be interpreted consistently with, the Civil Code, which may influence the legal consequences of events affecting contractual performance.
Article 273: Impossibility of Performance- One of the key statutory provisions addressing force majeure is Article 273 of the Civil Code:
“Article (273)
In contracts binding on both parties, if force majeure supervenes which makes the performance of the obligation impossible, the corresponding obligation shall cease, and the contract shall be automatically cancelled.
In the case of partial impossibility, that part of the contract which is impossible shall be extinguished, and the same shall apply to temporary impossibility in continuing contracts, and in those two cases it shall be permissible for the obligee to cancel the contract provided that the obligor is so aware.”
Article 273 essentially establishes that where an event of force majeure renders the performance of a contractual obligation impossible, the reciprocal obligation ceases and the contract may be automatically terminated. The provision further recognises that impossibility may be total, partial, or temporary in continuing contracts. In cases of partial or temporary impossibility, only the affected part of the contract may be extinguished.
Judicial Tests for Invoking Force Majeure:
It is important to note that Article 273 does not operate as a blanket exemption from contractual obligations. Courts generally apply certain legal tests before recognising a claim of force majeure.
In particular, the party invoking the provision must demonstrate that:
the event has resulted in a genuine impossibility of performance, rather than mere difficulty or increased cost;
that the event arose from circumstances beyond its control.
The party must also establish a clear causal link between the event and the inability to perform.
Where the impossibility is partial or temporary, the contract may continue to operate in respect of obligations that remain capable of performance.
Accordingly, force majeure cannot be relied upon merely as a mechanism to avoid contractual accountability or commercial risk. The burden of proof lies squarely on the party seeking to invoke force majeure to demonstrate compliance with the requirements of the Civil Code.
In addition to Article 273, Article 287 of the Civil Code addresses liability in circumstances where loss arises due to causes beyond a party’s control. It provides as follows:
“Article (287) - If a person proves that the loss arose out of an extraneous cause in which he played no part such as a natural disaster, unavoidable accident, force majeure, act of a third party, or act of the person suffering loss, he shall not be bound to make it good in the absence of a legal provision or agreement to the contrary.”
This provision reinforces the principle that liability for damages may be excluded where a party demonstrates that the loss was caused by an external factor over which it had no control. Once again, the burden lies on the party invoking this defence to establish that the loss resulted solely from such extraneous cause.
It is also important to distinguish force majeure from the concept of “exceptional circumstances of a public nature”, which is addressed under Article 249 of the Civil Code. Unlike force majeure, which requires impossibility, exceptional circumstances of a public nature apply when performance remains possible but becomes excessively onerous. Courts may adjust obligations reasonably, balancing the interests of all parties.
Practical Considerations for Contracting Parties:
Over time, judicial practice in the UAE has demonstrated the careful application of these provisions. During periods of major disruption, including the COVID-19 pandemic, Courts examined whether circumstances resulted in total, partial, or temporary impossibility of performance before determining the appropriate legal outcome.
This distinction has proven particularly relevant in property and real estate disputes, where parties frequently attempt to rely on force majeure in order to withdraw from Sale and Purchase Agreements, avoid contractual penalties, or justify delays in financing, regulatory approvals, construction timelines, or other transactional milestones. The UAE courts have consistently examined whether the circumstances genuinely rendered the transaction impossible, or whether the situation merely made the transaction commercially inconvenient or financially burdensome.
These provisions therefore operate as important safeguards within the UAE law, though they must be applied cautiously and, on a case-by-case basis. Even where a contract contains an express force majeure clause, its interpretation must remain consistent with the overarching principles of the Civil Code.
Given the complexity and case-specific nature of force majeure under UAE law, parties are advised not only to include well-drafted provisions in their contracts but also to seek expert guidance to assess enforceability. The outcome depends on the specific facts, the applicable statutory framework, and the interaction between contractual terms and Civil Code principles — making professional advice essential in navigating these issues.