Legal Definitions - murder clause

A murder clause refers to a specific provision within a contract that places extremely burdensome, and often unfair or impractical, requirements on one of the parties involved. These clauses can make it exceedingly difficult, if not impossible, for that party to fulfill their contractual duties without incurring significant losses, facing severe penalties, or even jeopardizing their business viability.

Here are some examples illustrating how a murder clause might appear in different contexts:

• Construction Project: Imagine a small excavation company signs a contract to prepare a site for a new building. The contract includes a clause stating that the excavation company is solely responsible for all costs and delays arising from any subsurface conditions encountered, regardless of whether these conditions were discoverable through standard pre-construction surveys or were entirely unexpected (e.g., discovering an ancient, unmapped underground river or a massive, unrecorded utility line). The clause also specifies that the company must complete the work by the original deadline, even with such discoveries, or face substantial daily fines.

  Explanation: This is a murder clause because it places an unreasonable and potentially catastrophic financial and logistical burden on the excavation company. They are made responsible for risks that are often beyond reasonable foresight or control, effectively forcing them to absorb costs and manage delays for issues that are typically shared or accounted for as unforeseen conditions in more balanced contracts. The strict deadline and severe penalties amplify the onerous nature of the obligation.

• Software Development Agreement: A freelance web designer is hired to create and maintain a website for a client. The contract specifies that the designer must fix any "critical bugs" within two hours of notification, 24 hours a day, 7 days a week, with a penalty of 10% of the total contract value for each missed deadline. However, the contract allows the client sole discretion to define what constitutes a "critical bug," even for minor aesthetic issues, and the designer is not compensated for the on-call availability or rapid response time.

  Explanation: This clause is a murder clause because it imposes an extremely onerous and potentially unmanageable obligation on the designer. The client's unilateral power to define "critical" combined with an unrealistic, uncompensated response time and severe penalties creates an unreasonable risk for the designer, making it nearly impossible to meet the terms without constant stress and potential financial ruin.

• Manufacturing Supply Contract: A small manufacturing company agrees to supply custom components to a larger corporation. A clause in the supply agreement states that if the larger corporation's production line experiences any downtime due to a defect in the supplied components, the manufacturer is liable for all lost profits of the corporation during that downtime, even if the defect was minor, quickly rectifiable, or only partially contributed to the shutdown. There is no cap on this liability.

  Explanation: This is a murder clause because it imposes a disproportionate and potentially ruinous liability on the small manufacturer. The manufacturer's liability is not capped or reasonably related to the value of the components supplied, but instead extends to the much larger entity's entire lost profits, which could be astronomical and far exceed the manufacturer's capacity to pay, effectively "killing" their business.