Since 2020, when the world faced the COVID-19 pandemic, and especially after February 24, 2022, the concept of «force majeure» has transformed from an abstract legal term into a widespread reality and a problem for thousands of Ukrainian companies. War, destruction of infrastructure, occupation of territories, blackouts, and logistical collapses have made the fulfillment of numerous contractual obligations impossible.
At the same time, a dangerous yet false misconception has spread within the business community regarding force majeure as a universal «indulgence» from performing any contracts. Many believe that the mere fact of war is sufficient not to fulfill their contractual obligations or to be released from liability for non-performance. However, judicial practice, in particular the final conclusions of the Supreme Court, demonstrates a significantly stricter and more pragmatic approach.
The purpose of this article is to provide a clear, structured, and practical guide on force majeure issues. Drawing on the analysis of key legislative provisions and current Supreme Court case law, we will debunk common myths, explain how to properly prove force majeure, what legal consequences to expect, and offer a step-by-step algorithm of actions to protect interests.
So, what is force majeure and what is it not
Before applying the force majeure tool, it is necessary to clearly understand its legal nature and limits. In fact, many in the business community have somewhat misconceptions about the application and essence of force majeure.
Legal frameworks
Legislation defines force majeure (circumstances of insuperable force) as extraordinary and unavoidable circumstances that objectively make the fulfillment of obligations impossible. The detailed definition of force majeure circumstances is contained in Part 2 of Article 14-1 of the Law of Ukraine «On Chambers of Commerce and Industry in Ukraine.» In turn, the Supreme Court (for example, case no.910/1779/23in his practice, consistently distinguishes four key features that must be present simultaneously:
- Emergency nature:The circumstances are not typical for this field of activity, and the parties could not reasonably have expected their occurrence when concluding the contract.
- Inevitability:The party could not prevent the occurrence of the circumstances or their consequences, even by exercising all reasonable efforts.
- Independence from the will of the parties:The cause of the circumstances is external and is not related to the actions or omissions of either party to the contract.
- Objective impossibility of performance:This is a key criterion. Force majeure makes the fulfillment of an obligation not simply difficult or economically disadvantageous, but impossible in principle under the given conditions.
That is, the characteristics of force majeure circumstances are their objective and absolute effect, as well as unpredictability (Resolution of the Grand Chamber of the Supreme Court dated May 8, 2018, in case No. 910/7495/16).
Common mistakes and the court's position (What is NOT force majeure)
Case law has developed clear answers to common business attempts to expand the concept of force majeure to ordinary commercial risks.
Myth 1: «Lack of money is a force majeure.».
This is one of the most common mistakes. The Supreme Court is categorical in its position regarding these circumstances: a financial crisis, the devaluation of the hryvnia, the lack of funds for the debtor or on the market in general do not constitute force majeure. This is considered an ordinary business risk that a party bears on its own. For example, in the case № 912/3323/20 The court clearly stated that the tenant's lack of funds to pay rent does not exempt them from liability, even under quarantine conditions.
Myth 2: «My counterparty let me down, therefore, I have a force majeure.».
Failure of counterparties (suppliers, carriers, or other partners) to fulfill obligations is generally not considered force majeure for you. Courts proceed from the premise that a party bears the risk of choosing its counterparties. In the case № 910/17079/23 The court did not recognize the problems faced by the Ukrainian supplier's Bulgarian partner as force majeure. An exception is possible only when the counterparty's non-performance was caused specifically by force majeure circumstances and there were no alternatives whatsoever on the market. However, such circumstances also require thorough proof.
Myth 3: «I couldn't get a permit/license.».
Administrative hurdles, delays by state authorities, and failure to obtain necessary licenses or permits are not qualified as force majeure. This is part of the predictable risks of conducting business activity. In the already mentioned case № 912/3323/20 The court explicitly stated that the failure to obtain a license for pharmacy activities cannot be considered a case of force majeure for the tenant.
Therefore, in matters of applying force majeure, judicial practice is quite unequivocal: force majeure is a tool for extraordinary and uncontrollable events, not for resolving commercial difficulties.
WAR AS FORCE MAJEURE: why is the general fact not enough?
Since the start of the full-scale invasion, many entrepreneurs have decided that the mere fact of martial law automatically releases them from all contractual obligations. This is not the case. The Supreme Court consistently emphasizes on the presence of a causal link.
The party invoking force majeure is obliged to prove not only the fact of the existence of the circumstance (war, hostilities), but also a direct, immediate, and insurmountable connection between this circumstance and the impossibility of performance specific obligations under specific contract. That is, the impossibility of fulfilling the obligation must be caused specifically by a force majeure circumstance, and not by circumstances the risk of occurrence of which is borne by the participant in the legal relationship.
It is not enough to say «there is a war in the country.» It is necessary to prove, for example: «due to the occupation of the city of Melitopol, where our only production workshop is located, we objectively cannot manufacture and deliver the ordered equipment.» In the case № 910/8580/22 The Supreme Court emphasized that martial law exempts from liability only if the circumstances related to it specifically made the fulfillment of the obligation impossible.
Using the example of two court cases, let us briefly demonstrate what courts mean by a causal link:
- Force majeure has been recognized:in case No. 686/16312/22 The grain elevator where the plaintiff's specific batch of grain was stored was seized by the armed forces of the Russian Federation. The court recognized this as force majeure, since the physical occupation of the facility made the return of this exact grain impossible. The cause-and-effect relationship was direct and obvious.
- Force majeure has been denied:in case No. 903/573/22 The fuel supplier cited the impossibility of supplies from the Mozyr Oil Refinery in Belarus due to the war. The court questioned this argument, noting that the supplier failed to prove why the blocking of a single supply channel made it impossible to fulfill the contract as a whole. The court essentially indicated that the party should have explored alternative sources on the market.
Practice shows that this approach by the courts effectively establishes an obligation for businesses to make efforts to minimize losses. Even in conditions of war, a party must demonstrate that it has taken all reasonable measures to find alternative ways of fulfilling its obligation. It is necessary to prove not only that the main path of fulfillment was blocked, but also that no reasonable alternative existed.
PROVING FORCE MAJEURE
Proper documentation and proving force majeure circumstances is crucial for a successful defense in court. The central element in this process is the certificate of the Ukrainian Chamber of Commerce and Industry (CCI), but let us consider whether the mere presence of the CCI certificate or another document will be sufficient for the effective application of force majeure.
The Law of Ukraine «On Chambers of Commerce and Industry in Ukraine» defines the CCI as the authorized body for certifying force majeure circumstances. For a long time, the CCI certificate was considered almost indisputable evidence.
However, the Supreme Court decision in case No. 908/2287/17 fundamentally changed this approach. The court established that CCI certificate is not indisputable evidence and is subject to critical evaluation by the court on an equal basis with other evidence. The court's rationale was that the certificate is issued on the basis of an application and documents provided by only one party to the contract. The other party is deprived of the opportunity to present its objections or arguments during the process of its obtaining. Therefore, the court is obliged to verify the validity of the CCI's conclusions in each specific case.
In this context, it should also be noted that a CCI certificate or other document is not the sole proof of force majeure. Such documents may include, among other things, State Emergency Service acts, extracts from the ERDR, police reports, photo/video documentation of destruction, expert conclusions, inventory acts, official announcements of the General Staff of the Armed Forces of Ukraine, military administrations, letters from carriers regarding the impossibility of delivery, GPS tracker data, official power outage schedules from regional energy companies (oblenergo), correspondence with energy suppliers, internal orders on enterprise downtime, and others.
In each specific case, the court will consider all available evidence in aggregate.
An analysis of practice shows that the judicial approach reveals a certain «hierarchy of trust» in evidence. Official documents from independent third parties (acts of the State Emergency Service, government resolutions) carry the greatest weight. Internal company documents (orders on downtime) carry the least. Therefore, gathering all possible evidence is an important component for achieving a positive outcome in court.
Briefly, as a means of proof, we should mention the general CCI letter dated February 28, 2022, which the parties still cite as confirmation of the occurrence of force majeure circumstances. The Supreme Court has repeatedly and clearly settled this issue. Thus, the court pointed out that the general letter of the CCI dated February 28, 2022, which certified military aggression as force majeure, cannot replace an individual certificate for a specific contract. This letter is merely a general information document. It confirms the fact of war, but does not prove the existence of force majeure for a specific enterprise and a specific obligation. Relying solely on this letter in court is a losing strategy.
Courts set a very high bar for proving such circumstances, protecting the fundamental principle of the stability of contractual relations: contracts must be performed.
ACTION PLAN FOR BUSINESS: how to properly declare force majeure
Proper and timely communication with a counterparty is no less important than collecting evidence. A breach of the procedure defined by the contract may deprive you of the right to invoke force majeure. In the event of force majeure circumstances, the following action algorithm is proposed:
Step 1. Immediately notify the counterparty of the occurrence of force majeure circumstances
The first and most important action is to check the terms of your contract regarding the force majeure notification procedure (deadlines, method, content). As a rule, in most cases the contract establishes a deadline within which a party must notify the other party of the occurrence of force majeure circumstances, and this provision of the contract is extremely important. The further resolution of the problem directly depends on its compliance. Untimely notification can have extremely negative consequences. Courts have repeatedly taken the position that if the contract provides that untimely notification deprives a party of the right to cite force majeure, the court will apply this provision even if the circumstances were real. The requirement for timely notification is based not on formalism, but on the principle of good faith. It gives your partner the opportunity to react in a timely manner and minimize their losses.
The Supreme Court in the case № 910/15264/21 noted that a distinction should be made between a party's timely notification of the occurrence of force majeure and the receipt of the CCI certificate. The notification must be sent within the timeframe specified in the contract, whereas the certificate can only be obtained after the breach of obligation, i.e., later. The notification should be sent to the other party as soon as possible, because force majeure usually affects the obligor, but its consequences are experienced precisely by the other party, which does not receive due performance. Timely notification is intended to protect its interests and make it possible to minimize losses.
Step 2. Record everything timely and properly
From the moment the circumstances arise, start gathering evidence. Contact the relevant state authorities, take photos and videos, save screenshots of news and official reports, collect certificates, save all correspondence with the counterparty, logisticians, suppliers, etc.
Step 3. Contact the CCI
Do not delay contacting the CCI to obtain a CCI certificate or other document specified by the contract. When preparing your application to the CCI, remember that it must relate to a specific contract and a specific unfulfilled obligation. Provide a detailed justification for the cause-and-effect relationship, attaching all the evidence gathered in the previous step.
Step 4. Communication with the counterpart
Declaring force majeure is not the end of a relationship, but the beginning of a dialogue. It opens up the possibility for negotiations on changing the terms of the contract, suspending it, or terminating it on agreed terms. Official correspondence with the counterparty, notifying them not only of the very fact of the onset of force majeure, but also of your further steps and estimated timeframes, is an important action that will demonstrate your good faith and attempt to resolve the problem in a short time. Such behavior can be a weighty argument for the court.
LEGAL CONSEQUENCES. WHAT FORCE MAJEURE EXEMPTS FROM AND WHAT OBLI'LANGUAGES REMAIN
Understanding the exact legal consequences of force majeure is of utmost importance for financial planning and risk management.
First of all, you need to know and remember – force majeure releases from liability for non-performance, untimely or improper performance of an obligation under the contract, but does not release from the very obligation to perform the contract. The specified rule is embodied in Article 617 of the Civil Code of Ukraine (CC of Ukraine).
Force majeure suspends the performance of the obligation for the duration of the circumstances and relieves of liability (fine, penalty, damages) for delay. However, the primary obligation (to deliver goods, provide a service, repay the principal debt amount) does not cancel. It must be performed after the force majeure circumstances cease.
Many people also mistakenly believe that force majeure exempts them from paying 3% in annual and inflation-related losses, the recoverability of which is governed by Article 625 of the Civil Code of Ukraine. In the case № 910/8741/22 The Supreme Court clearly explained that these charges, by their legal nature, are not measures of liability (penalties). They are a special mechanism that compensates the creditor for the loss of purchasing power of money due to the debtor's default. Тому форс-мажор не звільняє боржника від їх сплати — вони продовжують нараховуватись упродовж усього періоду прострочення, навіть якщо воно спричинене форс-мажорними обставинами. Цей ризик також необхідно враховувати.
ФОРС-МАЖОР ЧИ ІСТОТНА ЗМІНА ОБСТАВИН? Вибір правильного інструменту
Досить часто бізнес плутає форс-мажор з іншим правовим інститутом — істотною зміною обставин. Верховний Суд у справі № 910/17639/21 наголосив на необхідності їх чіткого розмежування цих категорій
- Форс-мажор (ст. 617 ЦК України).Виконання об’єктивно неможливе. Наслідок: призупинення виконання та звільнення від відповідальності.
- Істотна зміна обставин (ст. 652 ЦК України).Виконання possible, але стало настільки обтяжливим або втратило цінність, що це порушує початковий баланс інтересів сторін. Наслідок: зміна або розірвання договору за згодою сторін або, у виняткових випадках, за рішенням суду. На відміну від форс-мажору істотна зміна обставин не впливає на строк виконання зобов`язань (не змінює його) і не звільняє сторону від відповідальності за невиконання, а дозволяє припинити таке виконання (розірвання договору) чи змінити умови такого виконання або умови договору в цілому (для досягнення балансу інтересів сторін, який був порушений через істотну зміну обставин).
Отже, форс-мажор та істотна зміна обставин є різними правовими ситуаціями. Не можна, посилаючись на неможливість виконання (форс-мажор), одночасно вимагати від суду змінити умови договору (що є наслідком істотної зміни обставин). Істотна зміна обставин може бути застосована у випадку відсутності існування форс-мажору, але сторона має довести наявність всіх чотирьох умов, необхідних для внесення змін до договору.
ВИСНОВКИ ТА ПРАКТИЧНІ РЕКОМЕНДАЦІЇ ДЛЯ БІЗНЕСУ
Форс-мажор — це не універсальний захист, а складний юридичний інструмент, застосування якого потребує належного обґрунтування та доказів. Практика Верховного Суду дозволяє сформулювати такі ключові рекомендації:
Чек-лист для перевірки договорів:
- Визначення – чи чітко прописано, які обставини вважаються форс-мажорними.
- Повідомлення – чи встановлені строки, спосіб і адреса повідомлення іншої сторони.
- Докази – чи не обмежується підтвердження лише сертифікатом ТПП (краще передбачити можливість надання інших доказів).
- Наслідки – чи визначено, що відбувається у разі тривалого форс-мажору — призупинення виконання чи розірвання договору.
Системне управління договірними ризиками та врахування вимог судової практики — найкращий спосіб мінімізувати спори у складних умовах. Форс-мажор слід застосовувати обґрунтовано, своєчасно та з належною доказовою базою.
Source: ЛІГА:ЗАКОН
