Hardship as an impediment to performance in terms of article 79 of the CISG

Abstract

In international trade agreements the term 'hardship' is often used to describe the position when an unexpected event occurs, after a contract has been entered into, which would cause one party to be placed at a severe disadvantage should it perform. Hardship could serve as an impediment which prevents (albeit not objectively) the party from performing. The disadvantaged party might be excused from liability, based on that hardship, for its non–performance. The performance has in that situation become excessively onerous but not impossible in an objective sense. The above situation is also of importance in the application of the CISG. If article 79 of the CISG was designed to deal with cases of impossibility then what are the potential effects of including hardship as an impediment which results in excusing non–performance? The question leads to the interpretation of what the term 'impediment' means and how it was intended to be interpreted in terms of the CISG. The discretion as to the interpretation of article 79 and the inclusion of hardship in its scope of application is left entirely to the courts. The courts usually take into consideration the drafting history of article 79 and other international instruments to guide their discretion. There hasn't been anonymous acceptance of either including or excluding hardship in article 79's sphere of application. This uncertainty does not provide the unification which the CISG seeks to achieve as it creates skepticism as to the ability of the CISG to ensure certainty and to both protect and enforce parties' rights and duties.