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PO Box 161 Kempsey NSW 2440

T 02 6562 3300

DIY Conveyancing

Are you nervous about your house contract completing because of COVID-19?

You could be concerned about how COVID-19 might impact on you buying or selling property. You could be thinking: Is now the right time to buy? Will my contract protect me if I buy a house today?

During these times, with lives lost and job losses, it is normal to feel worried and anxious. Throw in buying or selling a house on top, and you’ve got yourself even more worry, confusion and stress.

Or do you? What if there was something that protected you and allowed you to buy or sell that house with added security and peace of mind? You will be pleased to know that there are two things which could protect you.


There are two things which could be used to give you more peace of mind when buying or selling property during these COVID-19 times:

1. Force Majeure

A force majeure clause is a clause which can be added to a contract which can be used to excuse parties to a contract from their obligations when a defined ‘event’ occurs outside of the parties control which prevents performance. A force majeure clause can also provide a contract termination right. It all depends on how the clause is drafted.

A force majeure event has been defined in contracts to include:

  • An ‘act of God’ such as an earthquake, flood, fire, pandemic, or natural disaster;
  • Acts of terrorism, war, or certain acts of government;
  • Work strikes or other labour disputes.

Could the COVID-19 pandemic be a force majeure event? It depends on whether the force majeure clause is included in the contract and whether the contract has a definition of the types of events that constitute a force majeure event. To find out whether a contract can be terminated due to a force majeure event the contract would need to be examined carefully to see if the event falls within the terms of the contract.

2. The Doctrine of Frustration

The doctrine of frustration is a concept which can be applied to end a contract in situations where an event occurs that is not the fault of either party, and it would make it impossible and/or unjust for the parties to be held to the obligations under the contract. Examples of this could be:

  • A change in law which would make performance of the contract illegal;
  • Physical destruction of the subject matter of the contract – such as the house on the property burning down before settlement.

An example of when a contract is unlikely to be found to be frustrated could include hardship or inconvenience.


If you need advice regarding your contract or if you want a force majeure clause inserted into your contract before exchange, you can contact our team of solicitors and we can help.

If you think an event has happened which has made it impossible for you to complete what you need to do under the contract, you can contact our office and we can provide you with advice.