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20 January 2021

Change and termination of the contract: when it is not allowed, and when allowed

A contract is agreement between two or more parties to establish, change or terminate civil rights and obligations. Since the contract is an agreement, it is rather problematic to change it unilaterally without the consent of the other party. Therefore, the main way to change or even terminate the contract is by agreement of the parties. But at the same time, in order to protect the interests of the party whose rights are violated by its counterparty, the law allows to change or terminate the contract by court decision.
Thus, the Civil Code of the Republic of Kazakhstan clearly defines that the contract may be terminated by a court decision only:
• in case of material breach of the contract by the other party;
• in other cases provided for by this Civil Code of the Republic of Kazakhstan, other legislative acts or the contract.
Any violation of the contract by either party is recognized as material, if entails for the other party such damage that it is largely deprived of what it had the right to rely on when signing the contract. It should be understood that you may go to court to change or terminate the contract only after refusal of the counterparty.
The essential requirement when changing or terminating the contract is the same form as the contract itself. That is, if the contract was notarized, then its amendment or termination is also subject to notarization.

It is also possible to withdraw from the contract if it is impossible to fulfill the contractual obligations, the counterparty is declared bankrupt, or the act of public authority is changed or canceled, on the basis of which the contract was concluded. In this case, the contract is deemed to be terminated or amended (if the withdrawal is in part). But such withdrawal is possible only if the contract is concluded without specifying its duration.
Thus, it is always possible to amend or terminate the contract with the consent of both parties in view of the freedom-of-contract. But if only one party is willing this, then it needs to have good reasons to demand contract amendment or termination through the courts.

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