Second Circuit - Force majeure clause: JN Contemporary Art LLC. V. Phillips Auctioneers LLC

Daily Record Staff//June 10, 2022//

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United States Court of Appeals for the Second Circuit

Force majeure clause

COVID-19 – Breach of contract

JN Contemporary Art LLC. V. Phillips Auctioneers LLC

21-32-cv

Judges Pooler, Raggi, and chin

Background: The defendant invoked the force majeure clause to terminate its agreement to sell a painting on behalf of the plaintiff, citing COVID-19 pandemic and state government orders requiring nonessential businesses to cease in-person operations. The plaintiff commenced a cause of action alleging breaches of contract, implied covenant of good faith and fair dealing, and fiduciary duty. The plaintiff appealed from the dismissal of its claim.

Ruling: The Appellate Division affirmed. The court held that the pandemic constituted a circumstance beyond the parties’ reasonable control as contemplated by their agreement.

Russell I. Zwerin and Aaron Richar Golub, of Esquire LLC, for the plaintiff-appellant; Luke Nikas, of Quinn Emanuel Urquhart & Sullivan, for the defendant-appellee.