Moratorium Definition and Legal Meaning
On this page, you'll find the legal definition and meaning of Moratorium, written in plain English, along with examples of how it is used.
What is Moratorium?
(n) Moratorium is the declaration of deferment of any or all activity till a future date or happening of a future event or conclusion of the present state of affairs which warranted such a moratorium. Eg. Moratorium passed prohibiting tax collection from public during the period of famines
History and Meaning of Moratorium
Moratorium is a legal term that originated from the Latin word "moratorius," which means "delaying." It is a declaration by a government or authority that postpones or temporarily suspends a specific activity or obligation for a particular period.
The purpose of a moratorium can be to provide relief to individuals or entities that are unable to meet their obligations due to unforeseen circumstances. Moratoriums are often implemented to provide protection to those facing financial difficulties, such as during an economic crisis or natural disasters.
Examples of Moratorium
Here are some examples of when a moratorium might be put in place:
- A city may declare a moratorium on new building permits to evaluate their impact on traffic and infrastructure.
- A government may impose a moratorium on evictions to provide temporary relief to tenants during a pandemic.
- A lender may grant a moratorium on loan payments to homeowners impacted by a natural disaster.
- A company may place a moratorium on hiring new employees until they reassess their current workforce needs.
- A utility provider may implement a moratorium on service disconnections for customers who cannot pay their bills due to financial distress.
Legal Terms Similar to Moratorium
Here are some legal terms that are closely related to the concept of a moratorium:
- Stay - An order issued by a court that temporarily suspends the proceedings in a case.
- Reprieve - A delay of a punishment or sentence in criminal law.
- Suspension - An interruption or pause in a legal process or activity.
- Hold - A legal term used to describe the temporary delay of a proceeding or activity.
- Freeze - A temporary suspension of a financial account or asset.