Wisconsin Electric Power Co. v. Union Pacific Railroad Co.

Union Pacific (defendant) hauled coal for WEPCO (plaintiff) and, under a force majeure clause, was entitled to charge more if prevented from backhauling iron ore in the empty return cars; after the steel mill it had been backhauling to closed, Union Pacific invoked the clause and raised its rate. WEPCO sued for breach and bad faith, arguing Union Pacific hadn't given required notice and had a broader duty to mitigate by finding something else to haul; the district court granted Union Pacific summary judgment.

Whether a force majeure clause in a contract may be used to justify a price increase.