Civil Law #4

Zhanat Alimanov, assistant professor

Remark

CONTRACT

Rescission* Termination** Voidance***

art. 401 art. 367 art. 159

Damages Restitution

& discharge of

obligations

*расторжение; **прекращение; *** признание недействительным

Home assignment

13. Section 1 (General Provisions), Labor Code

14. Section 2 (Employment Relationships), Labor Code

Find out what are the differences between Civil & Labor Codes (with references to articles).

Terms

1. To rescind – расторгнуть

2. Rescission – расторжение

3. Material Breach – существенное нарушение

4. Unilateral Refusal – односторонний отказ

Step 1 (Formation of Contract)

Is there an offer? (art. 393-5)

Is there an acceptance?

(art. 397)

If not, is there a counteroffer?

(art. 396)

If yes, there is a CONTRACT

Step 2 (How to avoid contract obligations?)

CONTRACT

FORM(форма,

articles 151, 152, 153)

DEFENSES(основания

недейств-сти, art. 159)

EXCUSES(Освобождение от

Ответ-ти, ст. 359, 374, 404)

No witnesses or

RestitutionRestitutionRestitution

PLAN

VI. Excuses from Liabilities

VII. Breach vs. Material Breach (Rescission)

VI. Excuses from Liabilities

Example 1

Andrei agreed to build a two storied

(двухэтажный) pub for Boris for

10 mln. They made contract.

When Andrei was digging foundation

of the pub. He found underground

waters which would 40 times

increase cost of the construction, up

to 400 mln.

Andrei says that it is impossible to

implement the contract.

Example 1

Is Andrei excused

(освобождается)

from his obligations?

Example 1

Is Andrei excused

(освобождается)

from his obligations?NO. Art. 359 (2) & 374

EXCUSE from Liability Art. 359 (2) & 374

2. Impossibility

Impossibility: must be real, not commercial

Example 2

Let’s assume that Andrei invested

heavily in foundation as well as tried

to divert the waters, but failed to

provide sufficiently solid foundation.

Given such foundation, Andrei

managed to build only one storied

(одноэтажный) pub. Besides, he

was one month late.

Boris sues for damages including

lost profit.

Example 2

1. Was Andrei in breach of contract?

2. What are consequences of the

breach?

3. Does Andrei have to pay damages?

Example 2

1. Was Andrei in breach of contract? Art. 349

2. What are consequences of the

breach? Art. 350

3. Does Andrei have to pay damages? NO. Art.

359.

EXCUSE from Liablity (articles 359, 404)

2. NOT GUILTY

Not Guilty: he did everything that he could to perform

properly

VII. Breach vs. Material Breach

Example 3

Let’s assume that Boris considersthis as material breach of contract.

He would like to rescind the contract.

A. What are the differences between

1. Material breach (Rescission);2. Breach?

B. What are the differences between consequences of:

1. Material breach (Rescission);2. Breach?

Consequences (art. 401, 403, 354)

BREACH

Material Ordinary

Rescission No Rescission

NO OBLIGATIONS OBLIGATIONS

Example 3

Let’s assume that Boris considers

this as material breach of contract.

He would like to rescind the contract.

What are the differences between consequences of:

(1) Material breach (Rescission); Boris does NOT have to pay money under the contract & right to damages

(2) Breach? Boris has to pay money, he has the right only to damages.

Step 1 (Formation of Contract)

Is there an offer? (art. 393-5)

Is there an acceptance?

(art. 397)

If not, is there a counteroffer?

(art. 396)

If yes, there is a CONTRACT

Step 2 (How to avoid contract obligations?)

CONTRACT

FORM(форма,

articles 151, 152, 153)

DEFENSES(основания

недейств-сти, art. 159)

EXCUSES(Освобождение от

Ответ-ти, ст. 359, 374, 404)

No witnesses or

RestitutionRestitutionRestitution

Step 3 (Consequences for Non-Compliance)

CONTRACT

BREACH(нарушение,

art, 359)

Damages (убытки)

MATERIAL BREACH

(сущест. нарушение, art. 401)

Damages (убытки) & Discharge of obligations

(Rescission*)

*расторжение => прекращение обязательств