- Russian Federation
- 09AP-55092/2015-GK, 09AP-57756/2015-GK
- Ninth circuit Arbitrazh Court of Appeal
STORAGE SERVICE CONTRACT - BETWEEN TWO RUSSIAN PARTIES - REFERENCE TO UNIDROIT PRINCIPLES TO INTERPRET APPLICABLE DOMESTIC LAW (RUSSIAN LAW)
FORCE MAJEURE AS UNFORESEEABLE AND UNAVOIDABLE EVENT - FIRE IN THE WAREHOUSE DESTROYING GOODS - OBLIGOR NOT EXEMPTED IF DOES NOT PROVE THAT OUTBREAK OF FIRE I WAS UNFORESEEABLE AND UNAVOIDABLE - REFERENCE TO ART. 7.1.7 UNIDROIT PRINCIPLES
A Russian company, the claimant, filed a claim for collection of the damages. The claims were based on the storage agreement. In accordance with the storage agreement the claimant transferred certain equipment to the defendant for storage. In the defendant’s warehouse the defendant there was a fire which destroyed the equipment. The court accepted the claims and partially collected damages from the defendant in favour of the claimant.
The court’s reasoning is explained below.
In accordance with the legal position of the Supreme Arbitrazh Court of the Russian Federation, contained in the Resolution of the Presidium dated 21 June 2012 N 3352/12 in case N A40-25926/2011-13-230, the legal qualification of a circumstance as a force majeure event is possible in case the following essential requirements are met: emergency and unavoidability.
Emergency means exclusivity, something that is going beyond the ordinary conduct, certain extraordinary life events, something which does relate to common risks of living and which cannot be taken into account under any circumstances. Any event of life cannot be qualified as a force majeure, as force majeure is an extraordinary event which has objective, not subjective, basis. The qualification of circumstances as a hardship (force majeure) is also widely recognised in the international practice.
According to Article 7.1.7 UNIDROIT Principles, having the status of an intergovernmental organisation, the circumstances of force majeure, in the case of which the party is exempted from liability for non-performance of obligations, are called an obstacle ‘beyond reasonable control of a person’, since it could not reasonably be expected to take this obstacle into account when concluding a contract or to avoid or overcome this obstacle or its consequences.
Such circumstances are extraordinary and unavoidable under the given circumstances.
Thus, force majeure events are understood as extraordinary and unavoidable circumstances, events, which come from outside and which do not depend on subjective factors: floods, natural disasters, earthquakes, hurricanes, avalanches, other natural disasters, as well as military actions and epidemics.
At the same time, the respondent did not present evidence that the fire occurred on 24 November 2014 in the warehouse located at Moscow, ul. Kotlyakovskaya, 6, p. 1, on the territory of JSC ‘Experimental Plant No 1’, as a result of which the disputed goods were destroyed, was due to natural phenomena of a spontaneous nature and has signs of emergency and objective unavoidability.
(cf. S. Petrachkov / A. Bekker in "Perspectives in Practice of the UNIDROIT Principles 2016", IBA Publication 2019, p. 264-265)