Dr. Lauri Railas, University of Helsinki & Railas Attorneys Ltd.
Changing Circumstances and Contracts – Fairness in Action?
Contracts may be affected by events beyond the control of the parties which is again evident in times of the Covid-19 pandemic. Whereas the performance of individual obligations may be impeded by force majeure events, the change of circumstances may affect the contractual equilibrium not only making performance of an obligation but the whole contractual relationship extremely onerous for a party. This is called hardship. The impact of changed circumstances on contracts has fascinated and employed lawyers for a century, and different approaches and theories have emerged. The fundamental justification for interference in contracts is good faith meaning the duty of the parties to observe the standards of fairness in their actions. But is it possible to define what is fair?
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