DOI: https://doi.org/10.21564/2414-990x.144.156506

Foreign currency in loan obligation

Богдан Петрович Карнаух

Abstract


The article is devoted to the study of problems associated with the use of foreign currency in loan agreements between physical persons. It is concluded that two situations should be distinguished: first, when a foreign currency constitutes the subject of an obligation; second, when the subject of an obligation is a national currency, and an indication of the equivalent in foreign currency should be regarded as an implied currency clause.

 In order conclude which exact situation is at hand in a particular case the court has to find out in which currency the loan was given to the borrower. As long as the borrower gets the loan in foreign currency, he is obliged to return the money in the same foreign currency.

 But whenever the court finds out that the loan in fact was given in national currency the question arises: how to treat the fact that in the obligatory writing two currencies are mentioned. First option: the mention of foreign currency can be disregarded as being made inter alia. Second option: it can be treated as an implied monetary clause, pursuant to which the sum of money to be returned in national currency cannot be less than agreed sum in foreign currency converted according the rate of exchange prevailing at the day of payment. It is concluded that the second option is more plausible.

 Special attention is payed to the problem of defining the exact rate of exchange that has to be applied in a case when the borrower fails to perform the obligation. It is concluded that existing rule (under which the rate of exchange prevailing at the day of court decision applies) is not optimal, since whenever the foreign currency depreciates this rule in fact encourage the borrower to delay payment. Therefore it is proposed to set the rule under which in case of non-performance the creditor could choose between the two rates of exchange: prevailing at the date of due payment or prevailing at the date of actual payment.


Keywords


loan; monetary obligation; foreign currency; monetary clause

References


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Decision of Supreme Court 25 Apr. 2018, case no. 303/218/17. URL: http://reyestr.court.gov. ua/Review/73660880.

Decision of Supreme Court 26 Sep. 2018, case no. 641/3238/14-ц. URL: http://reyestr.court. gov.ua/Review/78326764.

Decision of Supreme Court 25 July 2018, case no. 308/3824/16. URL: http://reyestr.court. gov.ua/Review/75691380.

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Fedorenko v. Ukraine, no. 25921/02, ECHR 1 June 2006. URL: http://hudoc.echr.coe.int/ eng?i=001-75599.

Ruling of the Plenum of Supreme Court of Ukraine 18 Dec. 2009 no. 14. URL: https://zakon. rada.gov.ua/laws/show/v0014700-09.

Decision of Supreme Court 13 June 2018, case no. 750/12868/16-ц. URL: http://reyestr. court.gov.ua/Review/74777379.

Decision of the Grand Chamber of Supreme Court 30 May 2018, case no. 750/8676/15-ц.URL: http://reyestr.court.gov.ua/Review/74537186.

Principles, Definitions And Model Rules Of European Private Law. Draft Common Frame of Reference (DCFR) / Study Group on a European Civil Code and the Research Group on the Existing EC Private Law (Acquis Group). URL: https://www.ccbe.eu/fileadmin/speciality_distribution/pub-lic/documents/EUROPEAN_PRIVATE_LAW/EN_EPL_20100107_Principles__definitions_and_ model_rules_of_European_private_law_-_Draft_Common_Frame_of_Reference__DCFR_.pdf.


GOST Style Citations


  1. Постанова Верховного Суду України від 13 грудня 2017 року у справі № 309/3458/14-ц. URL: http://reyestr.court.gov.ua/Review/71344011.
  2. Постанова Верховного Суду від 25 квітня 2018 року у справі № 303/218/17. URL: http:// reyestr.court.gov.ua/Review/73660880.
  3. Постанова Верховного Суду від 26 вересня 2018 року у справі № 641/3238/14-ц. URL: http://reyestr.court.gov.ua/Review/78326764.
  4. Постанова Верховного Суду від 25 липня 2018 року у справі № 308/3824/16. URL: http://reyestr.court.gov.ua/Review/75691380.
  5. Постанова Великої Палати Верховного Суду від 19.01.2019 р. у справі № 373/2054/16-ц. URL: http://reyestr.court.gov.ua/Review/79382745.
  6. Постанова Верховного Суду від 18 квітня 2018 року у справі № 753/11000/14-ц. URL: http://www.reyestr.court.gov.ua/Review/73500675.
  7. Постанова Великої Палати Верховного Суду від 04.07.2018 р. у справі № 761/12665/14-ц.URL: http://www.reyestr.court.gov.ua/Review/75296546 .
  8. FEDORENKO V. UKRAINE, no. 25921/02, ECHR 1 June 2006. URL: http://hudoc.echr.coe. int/eng?i=001-75599.
  9. Постанова Пленуму Верховного Суду України від 18.12.2009 року. № 14. URL: https:// zakon.rada.gov.ua/laws/show/v0014700-09.
  10. Постанова Верховного Суду від 13 червня 2018 року у справі № 750/12868/16-ц. URL: http://reyestr.court.gov.ua/Review/74777379.
  11. Постанова Великої Палати Верховного Суду від 30 травня 2018 року у справі 750/8676/15-ц. URL: http://reyestr.court.gov.ua/Review/74537186.
  12. PRINCIPLES, DEFINITIONS AND MODEL RULES OF EUROPEAN PRIVATE LAW. Draft Common Frame of Reference (DCFR) / Study Group on a European Civil Code and the Research Group on the Existing EC Private Law (Acquis Group). URL: https://www.ccbe.eu/fileadmin/ speciality_distribution/public/documents/EUROPEAN_PRIVATE_LAW/EN_EPL_20100107_ Principles__definitions_and_model_rules_of_European_private_law_-_Draft_Common_Frame_of_ Reference__DCFR_.pdf.


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ISSN 2224-9281