The state contract with the sole supplier did not fix the condition of a penalty — the courts did not recover it

24 May 2023, Wednesday

Based on the results of small purchases, two contracts were concluded with a single supplier. Transactions were terminated by agreement due to improper execution. Later, the customer went to court to collect a fine from the counterparty.

Appeal and cassation denied the claim:

• the contracts agreed only on the general condition that the parties are responsible for improper performance according to the law. The grounds for calculating the fine and the procedure for calculating it have not been fixed. This excludes collection;

• the disputed situation does not contradict Federal Law No. 44. Some types of transactions with a single supplier may not contain a number of mandatory conditions, including the liability of the parties.

Note that in practice there is an example when a legal penalty was collected from the customer, although it was not fixed in the contract with the sole supplier. The courts decided: the parties did not specify that the norms of Federal Law No. 44 would not apply to their agreement.

 

Document: Resolution of the Arbitration Court of the Ural District of 04.05.2023 in case N A34-4975/2022

SUBSCRIBE FOR NEWS
All content on this site is licensed under
Creative Commons Attribution 4.0 International