14.04.2023

Plenum of the Constitutional Court of the Republic of Azerbaijan, chaired by Farhad Abdullayev, held a regular session.

At the court session was examined the constitutional case based on the request lodged by the Supreme Court of the Republic of Azerbaijan on related interpretation of Articles 399, 421.3, 423.2, 424.3 and 447 of the Civil Code of the Republic of Azerbaijan.

Having heard the report of Judge R.Gvaladze, studied and discussed report of interested party – Supreme Court of the Republic of Azerbaijan; conclusions of specialist – Court of Appeal of Baku city, Bar Association of the Republic of Azerbaijan, Central Bank of the Republic of Azerbaijan, Association of Banks of Azerbaijan; opinion of experts – associate professor of the Department of Civil Law, Faculty of Law, Baku State University S.Suleymanli, Doctor of Philosophy in Law, and Professor of International Economic Law and Comparative Law, Halle-Wittenberg University A.Aliyev, the Plenum of Constitutional Court of the Republic of Azerbaijan adopted decision.

The decision states that cancellation of the contract on the grounds provided for in Article 421.2 of the Civil Code of the Republic of Azerbaijan takes place out of court by a unilateral expression of will in accordance with Article 421.3 of that Code. The contract is considered to be canceled by the notification of the will to the other party, and this is the general form of cancellation.

According to Article 422 of the Civil Code of the Republic of Azerbaijan, in case of significant change of circumstances, in accordance with Articles 423.2 and 424.3 of that Code, the party may apply to the court with a request to change or cancel the contract. This is a special procedure for the cancellation of the contract, and it is connected with the entry into force of the court decision.

In case of violation of the obligation under bilateral contracts, the creditor may terminate the contract by rejecting it in accordance with Article 447.1 of the Civil Code of the Republic of Azerbaijan. The contract is considered to have been terminated by notifying the other party of the intention to withdraw from the contract.

In terms of the requirements of Article 399.3 of the Civil Code of the Republic of Azerbaijan, the demand for delayed annuity (principal amount and accrued interest) payments before the termination of the contract remains valid even after the termination of the contract.

In accordance with Article 445.7 of the Civil Code of the Republic of Azerbaijan, if the creditor is unable to demand a larger amount based on other grounds in case of breach of obligation, he/she has the right to demand the payment of funds in the amount of five percent per annum for the delayed time.

The decision comes into force from the date of its publication, is final, and may not be cancelled, changed or officially interpreted by any institution or official.