Civil Law #3
Zhanat Alimanov, assistant professor
Home assignment 1
12.
Section 3
(Обязательственное
право),
Sub-Section 1, Civil
Code (General Part)
Terms
1.
2.
3.
4.
5.
6.
7.
8.
Unconscionable contract – кабальная сделка
Duress - принуждение
Fraud - обман
To repeal – признать недействительным
To void - признать недействительным
Rescission – расторжение
Voidance – недействительность
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
DEFENSES
(форма договора,
articles 151, 152, 153)
(основания
недейств-сти, art. 159)
Non Observance* of the
Notarized form
Non Observance of the
Simple Written Form
No Contract
Contract
Restitution
No witnesses
*несоблюдение
Restitution
Example (Let’s assume..)
KZ factory Katel insured its
buildings and equipment in KZ
against fire & other accidents
with the Golgans, English
insurance company.
Insurance fee was USD 10 mln.
Value of assets insured amounts
to USD 1 bln
The contract is governed by KZ
law.
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 2
Parents 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 old
dombra for KZT 7,000.
Masha, an antique expert,
recognized dombra made by
Stradivari, ancient Kazakh dombra
maker. Approximate price of it is
KZT 950,000 000.
She offered KZT 3,000, and Aibek
agreed.
Example 3
Aibek recognizes his dombra and
Masha on the TV. He learns about
his mistake.
He brings action into the court.
Can Aibek repeal the contract?
Example 3
Aibek recognizes his dombra
and Masha on the TV. He
learns about his mistake.
He brings action into the court.
Can Aibek repeal the
contract? Art. 159
Example 4
Marusya rents an apartment
thinking that it is the cheapest
offer in the area.
However, the offer appeared
to be one of the most
expensive.
Can she repeal it because of
significant mistake?
Example 4
Marusya rents an apartment
thinking that it is the cheapest
offer in the area.
However, the offer appeared
to be one of the most
expensive.
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, and
now have them transported to KZ.
The cargo costs USD 100 mln.
In KZ territorial waters, storm hits
her ship, and the ship starts to
sink (тонуть).
Example 4
Aziz came to Vika’s SOS
signal.
Vika says, “Aziz save my
carpets!” Aziz replies, “I
can buy them for USD 1 mln.”
They made contract.
Example 4
Vika brings action to the court. She
would like to repeal (признать
недействительным) the contract.
Can Vika repeal the contract?
Example 4
Vika brings action to the court. She
would like to repeal (признать
недействительным) the contract.
1.
2.
Duress?
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 5
Rustem sells a house. The
house is completely rotten with
huge hole in the walls.
He uses paper to stuff the
walls, and paints the house
all over.
Ainura would like to buy the
house. Rustem says, “Look
at the house, it costs
USD 500,000.
Example 5
Ainura buys the house. After
3 months, the house collapses
in front of Ainura’s eyes.
Ainura brings action to repeal
the contract.
Is there a contract between
Ainura & Rustem?
Example 5
Ainura buys the house. After
3 months, the house collapses
in front of Ainura’s eyes.
Ainura brings action to repeal
the 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
DEFENSES
(форма договора,
articles 151, 152, 153)
(основания
недейств-сти, art. 159)
Non Observance* of the
Notarized form
Non Observance of the
Simple Written Form
No Contract
Contract
Restitution
No witnesses
*несоблюдение
Restitution