<abstract xmlns="http://www.w3.org/1999/xhtml"><p>In the context of the conclusion of contracts between entrepreneurs under the Czech Civil Code, it is a relatively common arrangement that the parties disclaim any and all liability for damage arising from non-compliance with contractual obligations, if they can prove that this failure was due to an obstacle independent of their will. This circumstance excluding liability for the damage is called <italic>force majeure</italic> by the theory. In many countries this circumstance is ruled upon directly by the legislation (<italic>höhere Gewalt, vis major</italic>). The Czech regulations represented by the new Civil Code of 2012 (CivC), however, contains only a framework provision that mentions discharging reasons. The paper deals with the – rather disputable – issue that the <italic>force majeure</italic> does not affect the obligation to pay a contractual penalty under the new rules of the CivC. It should be therefore reflected in the arrangements for contractual penalties <italic>inter partes</italic>. To this effect the paper analyses the concepts of contractual penalties and <italic>force majeure</italic> in civil law legislation. Afterwards it compares their mutual relationship and impact on the obligations of the Contracting Parties. Finally, it draws recommendations for practice from the perspective of the contracting process.</p></abstract>

In the context of the conclusion of contracts between entrepreneurs under the Czech Civil Code, it is a relatively common arrangement that the parties disclaim any and all liability for damage arising from non-compliance with contractual obligations, if they can prove that this failure was due to an obstacle independent of their will. This circumstance excluding liability for the damage is called force majeure by the theory. In many countries this circumstance is ruled upon directly by the legislation (höhere Gewalt, vis major). The Czech regulations represented by the new Civil Code of 2012 (CivC), however, contains only a framework provision that mentions discharging reasons. The paper deals with the – rather disputable – issue that the force majeure does not affect the obligation to pay a contractual penalty under the new rules of the CivC. It should be therefore reflected in the arrangements for contractual penalties inter partes. To this effect the paper analyses the concepts of contractual penalties and force majeure in civil law legislation. Afterwards it compares their mutual relationship and impact on the obligations of the Contracting Parties. Finally, it draws recommendations for practice from the perspective of the contracting process.

Contractual Penalty and the Right to Payment for Delays Caused by Force Majeure in Czech Civil Law under the New Civil Code

Department of Law and Social Sciences, Faculty of Business and Economics, Mendel University in Brno, Zemědělská 1, 613 00 Brno, Czech Republic

DANUBE

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.

In the context of the conclusion of contracts between entrepreneurs under the Czech Civil Code, it is a relatively common arrangement that the parties disclaim...

Contractual Penalty and the Right to Payment for Delays Caused by Force Majeure in Czech Civil Law under the New Civil Code

Published Online: Jan 06, 2016

Page range: 259 - 269

DOI: https://doi.org/10.1515/danb-2015-0016

Keywords
Circumstances Excluding Liability, Contractual Penalty, Delay in Contract Performance

© 2015 Martin Janku, published by De Gruyter Open

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.

Contractual Penalty and the Right to Payment for Delays Caused by Force Majeure in Czech Civil Law under the New Civil Code

Published Online: Jan 06, 2016

Page range: 259 - 269

DOI: https://doi.org/10.1515/danb-2015-0016

KeywordsCircumstances Excluding Liability, Contractual Penalty, Delay in Contract Performance

© 2015 Martin Janku, published by De Gruyter Open

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.

Keywords
Circumstances Excluding Liability, Contractual Penalty, Delay in Contract Performance