Which clause requires continued payments despite events like disasters or equipment failure?

Which clause requires continued payments despite events like disasters or equipment failure?

• A. Force majeure excuses payments during events.
• B. Payments are required to continue regardless of disasters or interruptions.
• C. Lease ends if equipment fails.
• D. Taxes are deferred until after repairs.

Answer: (B)

In a lease, there can be a covenant that keeps the rent coming no matter what happens to the equipment or due to a disaster. This kind of provision ensures the lessor receives the expected payments even if the asset is damaged or operations are interrupted. Force majeure would typically excuse performance during such events, not require it, so it doesn’t fit. A clause that ends the lease if the equipment fails would stop payments, not continue them, and deferring taxes has nothing to do with continuing rent. So the statement that payments are required to continue regardless of disasters or interruptions best matches the concept being tested.

In a lease, there can be a covenant that keeps the rent coming no matter what happens to the equipment or due to a disaster. This kind of provision ensures the lessor receives the expected payments even if the asset is damaged or operations are interrupted. Force majeure would typically excuse performance during such events, not require it, so it doesn’t fit. A clause that ends the lease if the equipment fails would stop payments, not continue them, and deferring taxes has nothing to do with continuing rent. So the statement that payments are required to continue regardless of disasters or interruptions best matches the concept being tested.