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Civil Law #3
Zhanat Alimanov, assistant professor
Home assignment 1
12. Section 3 (Обязательственное право),
Sub-Section 1, Civil Code (General Part)
Terms
1. Unconscionable contract – кабальная сделка
2. Duress - принуждение
3. Fraud - обман
4. To repeal – признать недействительным
5. To void - признать недействительным
6. Rescission – расторжение
7. Voidance – недействительность
8. Malicious contract – злонамеренное соглашение
PLAN
V. Defenses to contract formation
V. Defenses to formation of Contract (art. 159)
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 (Consequences)
CONTRACT
FORM(форма договора,
articles 151, 152, 153)
Non Observance* of the Notarized form
DEFENSES(основания
недейств-сти, art. 159)
RestitutionNon Observance of theSimple Written Form
No Contract Contract
Restitution No witnesses
*несоблюдение
Example (Let’s assume..)
KZ factory Katel insured itsbuildings and equipment in KZagainst fire & other accidentswith the Golgans, Englishinsurance company.
Insurance fee was USD 10 mln.Value of assets insured amountsto USD 1 bln
The contract is governed by KZlaw.
Example (Let’s assume..)
Let’s assume that fire has
occurred.
Katel demands insurance.
Golgans says that there is no
contract as it was not aware of
licensing requirement of KZ
legislation.
Example (Let’s assume..)
Can Golgans repeal (признасть
недействительным) the contract?
What are the consequences of contract voidance?
What are the consequences of the validity of the
contract?
Example (Let’s assume..)
Can Golgans repeal the contract?
Art. 159
What are the consequences of contract rescission?
Art. 157, Restitution
What are the consequences of the validity of the contract? 1 bln.
Defense
1. NO LICENSE
Example 2Parents gave Malika, a 13 year old
girl, money to buy a coat.
Instead, Malika bought a golden
necklace, saying that she just turned
18.
Malika broke the necklace. Parents
would like to give back the necklace,
and take the money back.
Example 2
Can parents
repeal the contract
& take back the money?
Example 2
Can parents
repeal the contract
& take back the money?
Art. 159
Defense
2. NO DEED CAPACITY
Example 3
Aibek would like to sell his olddombra for KZT 7,000.
Masha, an antique expert, recognized dombra made by Stradivari, ancient Kazakh dombramaker. Approximate price of it isKZT 950,000 000.
She offered KZT 3,000, and Aibekagreed.
Example 3
Aibek recognizes his dombra andMasha on the TV. He learns abouthis mistake.
He brings action into the court.
Can Aibek repeal the contract?
Example 3
Aibek recognizes his dombraand Masha on the TV. Helearns about his mistake.
He brings action into the court.
Can Aibek repeal the contract? Art. 159
Example 4
Marusya rents an apartmentthinking that it is the cheapestoffer in the area.
However, the offer appearedto be one of the mostexpensive.
Can she repeal it because of significant mistake?
Example 4Marusya rents an apartmentthinking that it is the cheapestoffer in the area.
However, the offer appearedto be one of the mostexpensive.
Can she repeal it because of significant mistake?
Mistake in motives
Defense
3. SIGNIFICANT MISTAKE Not in motives
Example 4
Vika bought carpets in Iran, andnow have them transported to KZ.
The cargo costs USD 100 mln.
In KZ territorial waters, storm hitsher ship, and the ship starts tosink (тонуть).
Example 4
Aziz came to Vika’s SOSsignal.
Vika says, “Aziz save mycarpets!” Aziz replies, “Ican buy them for USD 1 mln.”
They made contract.
Example 4
Vika brings action to the court. Shewould like to repeal (признатьнедействительным) the contract.
Can Vika repeal the contract?
Example 4
Vika brings action to the court. Shewould like to repeal (признатьнедействительным) the contract.
1. Duress?
2. Is it unconscionable contract (кабальная сделка)?
Criteria to determine Duress
ILLEGALITY (противозаконность)*
Example 4
Michael sold it for 400,000 tenge.
Is it unconscionable contract (кабальная сделка)?
5. UNCONSCIONABLE CONTRACT
Did not have any choice = illegal pressure
Example 5Rustem sells a house. Thehouse is completely rotten withhuge hole in the walls.
He uses paper to stuff thewalls, and paints the houseall over.
Ainura would like to buy thehouse. Rustem says, “Lookat the house, it costs USD 500,000.
Example 5
Ainura buys the house. After 3 months, the house collapsesin front of Ainura’s eyes.
Ainura brings action to repealthe contract.
Is there a contract between Ainura & Rustem?
Example 5
Ainura buys the house. After 3 months, the house collapsesin front of Ainura’s eyes.
Ainura brings action to repealthe contract.
Is there a contract between Ainura & Rustem?
Art. 159
Criteria to determine Fraud
6. FRAUD*
includes action & inaction
Alternative => Breach
(art. 349)
Умысел – как критерий определения
Example 6
Madina is a bank employee. She is in
charge of sale of assets of bank’s
“stressed” debtors.
She knows that soon a nice car would
be on sale at the bank’s auction.
She arranges that notification about the
auction was made 1 day before the
auction, and she sold the car to her
brother for KZT 500,000.
Example 6
Can owner of the car or the bank
repeal the contract?
Умысел – как критерий определения от отсутствия опыта
Defense
7. MALICIOUS CONTRACT
Example 6
Madina is a bank employee.
She is in charge of sale of
assets of bank’s “stressed”
debtors.
She sells the car which costs
10 mln for 100 000.
Is this a malicious contract?
Defense
7. MALICIOUS CONTRACT
Умысел – как критерий определения от небрежности
III. Defenses to formation of Contract (art. 159)1. No license
2. No deed capacity
3. Significant Mistake
4. Duress
5. Unconscionable contract
6. Fraud
7. Malicious Contract
III. Defenses to formation of Contract (art. 159)
8. Mental disorder (душевное
расстройство) or dementia (слабоумие)
9. State when one could not
realize significance of his actions or have control over them.
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 (Consequences)
CONTRACT
FORM(форма договора,
articles 151, 152, 153)
Non Observance* of the Notarized form
DEFENSES(основания
недейств-сти, art. 159)
RestitutionNon Observance of theSimple Written Form
No Contract Contract
Restitution No witnesses
*несоблюдение
