Data

Date:
30-06-2023
Country:
Russian Federation
Number:
A50-27943/2022
Court:
Seventeenth Arbitrazh Appellate Court
Parties:
Procion v Legal bureau Statsky Sovetnik

Keywords

SERVICE CONTRACT - BETWEEN TWO RUSSIAN COMPANIES – REFERENCE TO UNIDROIT PRINCIPLES TO INTERPRET APPLICABLE DOMESTIC LAW (RUSSIAN LAW)

DISTINCTION BETWEEN THE DUTY TO ACHIEVE A SPECIFIC RESULT AND THE DUTY OF BEST EFFORTS - REFERENCE TO UNIDROIT PRINCIPLES (ART. 5.1.4)

Abstract

The court reviewed an appeal by the claimant, who sought restitution of a certain amount as unjust enrichment and interest from the respondent. The dispute arose from a legal services contract, under which the claimant alleged that the respondent had failed to perform the full scope of agreed services, thereby justifying repayment of part of the fee.

The court rejected the claim, confirming that the respondent had carried out the essential contractual obligations, including preparing submissions in a tax dispute. It underlined that legal service contracts are not outcome-based; payment is owed for the process of providing services, not for the eventual result of litigation. In doing so, the court referred to UNIDROIT Principles of International Commercial Contracts (2010), Article 5.1.4, which distinguishes between obligations “of result” and obligations “of best efforts.” Where an obligation is one of best efforts, the party must demonstrate reasonable diligence comparable to that of a prudent person in similar circumstances, but does not promise the specific result.

The court found that the respondent had met this standard. Accordingly, the appellate court dismissed the claimant’s appeal, reinforcing the role of UNIDROIT Principles in clarifying contractual obligations in Russian judicial practice.

Abstract in English kindly provided by Roman Zykov.

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