Changed Circumstances as Ground for Non-Performance of Contracts (An Overview of Macedonian Contract Law)

Abstract

The purpose for which parties enter into a contractual relationship is to create relevant rights and obligations, which means that the interest of these parties is that the created obligations must be performed as agreed. As such, this purpose is supported since Roman law, through the principle of pacta sunt servanda. This principle meant that a party to the agreement is responsible for non-performance, while not entering into the reasons, respectively to the nature of the impediments that led to that non-performance. However, the case law quickly proved that the implementation of this principle frequently charging the party with responsibility for which it cannot really be responsible. After the conclusion of the contract but before the contract is performed a party’s situation may change due to changed circumstances, change that make it impossible or excessively difficult to perform for any of the parties. Which means, the situation and circumstances have changed since the moment of signing the contract, that the parties would not have entered into the contract, or would have made it differently had they known what was going to happen. This paper examines exclusion of party’s liability due to changed circumstances by provisions in the Law on Obligations of the Republic of Macedonia. The review includes the conditions that must be met to consider as changed circumstances, the obligation to give notice to the other party, and excluding the possibility of invoking the changed circumstances.