Actual Problems of
Economics and Law




DOI: 10.21202/1993-047X.11.2017.1.98-107

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Authors :
1. Aleksandr V. Padiryakov, Head of projects in the sphere of legal support of international activities
"Rostekh" State Corporation

2. Roman V. Barabash, Chief Legal Advisor – expert
"Rostekh" State Corporation

Frustration of contracts, signed in compliance with law of England, as a probable consequence of EU sanctions against Russian companies

Objective: comprehensive analysis of the doctrine of the frustration of contracts, signed in compliance with law of England, and the practice of its application for the Russian companies.

Methods: dialectical approach to cognition of social phenomena, allowing to analyze them in historical development and functioning in the context of the totality of objective and subjective factors that determined the choice of the following research methods: systematic-structural, formal-legal, comparative-legal, legal modeling method.

Results: due to the introduction of the EU sanctions, there is the risk of foreign counterparties’ refusal to execute contracts with Russian companies on the legal basis of frustration of treaties. The essence of the frustration doctrine is that the contract obligations may be terminated if, after their signing, such events occur, which make their fulfillment impossible or unlawful. When signing international agreements under English law, the lawyers of Russian companies should include provisions governing the relationships of the parties in case of impossibility of the contract execution due to the occurrence of an event that caused the treaty frustration, in particular, the imposition of sanctions. It is recommended to specify in the contract how the losses, arising from the inability to execute the contract, will be distributed between the parties.

Scientific novelty: for the first time, basing on court practice review, the definition of the frustration of contracts according to the law of England is formulated, the legal implications of the recognition of the contract frustrated are discussed, and the legal conditions are proposed that should be provided for in the text of a contract to avoid the problem of uncertainty in the allocation of losses of the parties in case of occurrence of external events, including sanctions.

Practical significance: the main provisions and conclusions of the article can be used in scientific and law-enforcement activity, when dealing with the doctrine of the frustration of contracts in compliance with the law of England, and the practice of its application in relation to Russian companies.

Keywords :

Civil law; Frustration of treaty; Frustration; Sanctions; EU; Court practice; Russian companies

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Citation :

Padiryakov A. V., Barabash R. V. Frustration of contracts, signed in compliance with law of England, as a probable consequence of EU sanctions against Russian companies, Actual Problems of Economics and Law, 2017, vol. 11, No. 1, pp. 98–107 (in Russ.). DOI: 10.21202/1993-047X.11.2017.1.98-107

Type of article : The scientific article

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