As explained above, the force majeure that prevents the buyer from taking the goods is one of the common deductions to the amount of TOP, thus eliminating any obligation to take or pay for that specified quantity. While this is the case in LNG sales contracts and certain gas sales contracts (which generally have fulsomer and more expensive provisions), it is surprising that many on-demand payment contracts, which cover electricity, water and other raw materials, are lacking. In the absence of specific treatment on the impact of force majeure on the buyer`s obligation to take or pay, the seller and buyer may test the effectiveness of the contractual dispute settlement clause if a force majeure event occurs and the parties have differing views as to whether the payment is still due. Liability limitations are used to manage contract risks. In the absence of a statute of limitations, there is no financial limit on the damages that a party can claim. Parties wishing to reduce the risk of a contract should include an explicit limitation of liability clause. A significant risk zone for take-and-pay contracts appears at the beginning of deliveries. If the buyer is delayed in commissioning the facilities necessary to supply the goods, the seller still expects that the obligation to take or pay begins on the first delivery date of the contract: deliveries cannot begin, but the commitment to take-or-pay begins. However, the seller must be able to prove that the seller is available, despite the buyer`s delay, to provide the goods for delivery. Otherwise, the buyer can prove that the seller cannot complete the delivery, he can possibly argue that the amount of TOP is reduced, eliminating the delimitation of the take or payment. When faced with this problem, the seller still has to do all his power to demonstrate his ability to deliver the goods.
In practice, this meant that vendors completed wells and completely occupied production facilities, when it was clear that their buyer would be put into service several months or years too late. It is interesting to note that neither the English nor the American courts have defended the position that the existence of a right of make-up is a precondition for the implementation of a take-or pay clause. In some U.S. cases, the courts have ruled that if a right to makeup exists, but the buyer is not able to take such amounts of makeup in the future the buyer is not excused from his obligation to fulfill the contract in its entirety.