MINIMIZATION OF RISKS IN CONTRACTUAL OBLIGATIONS

Abstract

The article deals with the risks in contractual obligations. The author defines them and clarifies the means of minimization. It is stressed that attempts “to miscount” risks, determine the probability of their implementation, predict the consequences and influence them were made in different epochs using various methods. This has generated a vast deal of risks theories, which somewhat try to explain the essence of risk and ways to influence it. Thus, the present requires to review the well-established methodology and to use new approaches to risk management. It is logical to assume that a contract has become one of the means of risk minimization, which has legal force and is the will of parties in terms of risk sharing. At the same time, a well-established system of contractual risk management is the most powerful tool for minimizing these risks. The article provides the main features and essential characteristics of a contractual risk. The author proposes to amend Art. 623 of the Civil Code of Ukraine to achieve a maximum efficiency and execute an economic role of risk sharing tool by an agreement. It is emphasized that the parties shall agree the principle of freedom of contract with other principles of civil law when regulating risks sharing through a contract (for example, the risk of non-performance or improper performance of the contract). It is mentioned of the principle of freedom of contract enshrined in Art. 3 of the CC of Ukraine, which is a kind of a manifestation of dispositiveness in contractual relations providing for the possibility of a person to exercise his civil rights freely and in his sole discretion. The author concludes that a contract has a double nature. On the one hand, the contract is a tool for risk sharing, implementing the compensatory function. On the other hand, the contract per se can be a source of risk. In such a case, the risk may be manifested at the stage of concluding the contract, in the context of the terms of the contract, during the performance of the contract or turn into financial risk.