FUNDAMENTAL BREACH OF CONTRACT UNDER THE UN CONVENTION ON CONTRACTS FOR THE INTERNATIONAL SALE OF GOODS

Authors

DOI:

https://doi.org/10.5937/ptp2304174T

Keywords:

breach, fundamental breach, contract, international sale of goods, detriment, damage, reasonable person, foreseeability

Abstract

The concept of fundamental breach of contract under the United Nations Convention on Contracts for the International Sale of Goods (CISG) of 1980 plays a pivotal role in determining the legal remedies available to the aggrieved party. It allows for contract termination only in instances where a breach is deemed fundamental. This paper delves into a comprehensive analysis of the institution of fundamental breach of contract and its characteristics, providing insight into how the Convention distinguishes between a fundamental breach and a non-fundamental breach. As a result, it assists in resolving potential uncertainties and dilemmas the aggrieved party might face concerning the choice of legal remedies. The analysis begins with an exploration of the background and drafting process of Article 25 of the Convention. The focus then shifts to an in-depth analysis of the institution of fundamental breach of contract. This covers how and why the distinction between a fundamental breach and a non-fundamental breach emerged, leading up to an intricate examination of all the conditions and features of a fundamental breach of contract, all with the aim of accurately defining this term in line with the provisions of the Convention. The study also encompasses a review of pertinent judicial and arbitral practices, aiding in a better understanding of the practical application and interpretation of the institution of fundamental breach of contract. Special attention is devoted to analyzing how the aggrieved party can be confident in its right to terminate the contract and how to sidestep potential hazards and consequences of an unjustified termination.

Through a detailed review of the Convention's provisions and both judicial and arbitral practices, this paper offers a succinct insight into the institution of fundamental breach of contract in the context of international sales of goods. It investigates how contracting parties can safeguard themselves and how they can act in accordance with the rights and obligations stipulated by the Convention.

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Published

2023-12-31

How to Cite

Tepavac, N. (2023). FUNDAMENTAL BREACH OF CONTRACT UNDER THE UN CONVENTION ON CONTRACTS FOR THE INTERNATIONAL SALE OF GOODS. Pravo - Teorija I Praksa, 40(4), 174–198. https://doi.org/10.5937/ptp2304174T