THE ROLE OF CONTRACTUAL REGULATION OF THE MECHANISM FOR PROVING A MATERIAL CHANGE IN CIRCUMSTANCES

Abstract

The article identifies the problems which arise in the process of proving a material change of circumstances in the context of law enforcement, and establishes that the current priority is to form a clearly defined, effective institution of a material change of circumstances and to adapt legal approaches to its regulation to new challenges. It is stated that the institute of a material change of circumstances is not new to Ukrainian legislation and was formed under the influence of international law, which is better known as, in particular, the principle of “hardship”. However, today it is still quite controversial due to its lack of legal certainty. This problem is evident in the practical implementation of Article 652 of the Civil Code of Ukraine, in particular, the vast majority of court decisions are quite critical of evidence of a significant change in circumstances that the parties could not have foreseen when entering into the agreement (contract). Therefore, it becomes quite burdensome to balance the property interests of the parties in the event of a material change of circumstances, and the provisions of Article 652 of the Civil Code of Ukraine in its current wording do not sufficiently clearly define the mechanisms for proving it, which leads to legal disputes and legal uncertainties. It is shown that the absence of this mechanism has a negative impact, which is manifested in the following aspects: complication of protection of the interests of the parties to the contract, legal uncertainty, reduction of trust in the legal system, delay in the dispute resolution process, abuse of the right to amend or terminate the contract in case of a material change in circumstances. Instead, the establishment of a mechanism to prove the existence of a material change in circumstances that the parties could not have foreseen when entering into the agreement (contract) will contribute to the transparency of contractual relations, improve contractual discipline, reduce legal risks, fairly resolve disputes, and facilitate litigation. And to ensure compliance with the principle of freedom of contractual relations, it is important to legislate the obligation of the parties to determine such a mechanism in the contract.