Definition

Hardship clause (Ro.: clauză de hardship/ clauză de revizuire/ clauză de impreviziune, De.: ~r Wegfall/ ~e Störung der Geschäftsgrundlage, Fr.: clause d'imprévisibilité, n.f./ clause de sauvegarde, n.f., Gr.: απρόβλεπτη μεταβολή των συνθηκών, Cz.: doložka vyšší moci) (See also: Force majeure, Fortuitous event, Frustration of contract, Non-performance) = refers to the possibility to adapt the contract when an unpredictable situation arises, the clause’s main purpose being to ensure the continuation of the contract. This clause allows the parties to make changes in the contract when unforeseen events occur, because of which it becomes harder for one party to fulfil the contractual obligations. The hardship clause is commonly used in international commerce and long-term contracts.

In legal systems such as the German and the Austrian legislations, it is not necessary to insert such a provision in the contract. If the circumstances standing at the grounds of the initial agreement change, adaptation can be requested, even if a hardship clause is not included herein. In case the adaptation of the contract is not possible or if it cannot be imposed, the disadvantaged party can withdraw from the contract, thus terminating the contract. 

 

Useful links

Legislation

http://www.unidroit.org/instruments/commercial-contracts/unidroit-principles-2010/403-chapter-6-performance-section-2-hardship/1058-article-6-2-2-definition-of-hardship - Uni Droit Principles 2010 (Article 6.2.2.) [English]

http://www.derecho.uba.ar/internacionales/competencia_arbitraje_iic_force_majeure_and_hardship_clauses_2003.pdf - Debattista, C., ICC Force Majeure Clauses 2003 ICC Hardship Clauses 2003, International Chamber of commerce [English]

Case law

http://hudoc.echr.coe.int/sites/eng/pages/search.aspx?i=001-60166#{"itemid":["001-60166"]} - ECHR, CASE OF DEL SOL v. FRANCE, 2002

Organisations and associations

http://www.uba.ua/documents/doc/roman_stepanenko.pdf - Stepanenko, R., Puginsky, E., Hardship clauses: added any value?, Ukrainian Bar Association (Ukraine)

http://www.arbitrage-maritime.org/fr/Gazette/G29complement/hardshipexemptionAPHD.pdf - Delebecque, Ph., Hardship clauses and exemption clauses in charter-parties, International Congress of Maritime Arbitrators

http://www.allenovery.com/publications/en-gb/Pages/Hardship-and-anticipatory-breach-revisited--Belgian-civil-law-concepts--.aspx - Hardship and anticipatory breach revisited. Belgian civil law concepts?, Allen&Overy (Belgium)

Online Publications

http://www.academia.edu/315218 3/Hardship_in_French_English_and_German_Law - Zivkonic, V., 2010, Hardship in French, English and German Law, Academia.edu

http://www.forwarderlaw.com/library/view.php?article_id=545 - Bugden, P., 2009, Hardship clauses for hard times, Forwarder Law

http://www.austlii.edu.au/nz/journals/VUWLawRw/2008/39.pdf - Schwenzer, I., 2008, Force majeure and hardship in international sales contracts, Australasian Legal Information Institute

http://www.researchgate.net/publication/228170557_The_Hardship_and_Force_Majeure_Clauses_in_International_Petroleum_Joint_Venture_Agreements - Al-Emadi, T. A., 2011, The Hardship and Force Majeure Clauses in International Petroleum Joint Venture Agreements, Research Gate

http://www.natlawreview.com/article/defining-undefinable-codifying-force-majeure-and-hardship - Downes, R., 2014, Defining the Undefinable: Codifying ‘Force Majeure’ and ‘Hardship’, National Law review

Publications

Brunner, C., 2009, Force majeure and hardship under general contract principles: exemption for non-performance in international arbitration, Austin, Wolters Kluwer Law & Business

Klotz, J.M., 1997, International sales agreements: an annotated drafting and negotiation guide, Alphen aan den Rijn, Kluwer Law International

Gold, J., 1990, Legal effects of fluctuating exchanges rates, Washington, International Monetary Fund

Practical use

http://www.uncitral.org/pdf/english/texts/procurem/construction/Legal_Guide_e.pdf - Legal Guide on Drawing Up International Contracts for the Construction of Industrial Works, United Nations Commission on International Trade Law

http://www.intracen.org/uploadedFiles/intracenorg/Content/Exporters/Exporting_Better/Templates_of_contracts/7%20International%20Commercial%20Agency.pdf - Model contract for small firms, International Trade Centre

 

By Ioana Bărăian