What are the differences in the consequences of the invalid...

What are the differences in the consequences of the invalid transaction and the transaction of the failed (not concluded contract)?

Mention of differences in the consequences of an invalid and failed transaction can give rise to a perfectly legitimate question: "What does it matter if both failed and invalid transactions have no legal effect?" It should be noted that this question has been discussed for a long time in the science of civil law and reflection on it, even led some scientists to conclude that there is a refusal to distinguish between invalid and non-concluded transactions, because there is no applied value in this, because both have the same consequences. As for judicial practice, it stands on well-defined positions: an invalid transaction entails the consequences specified in cl. 167 of the Civil Code of the United States; an unincluded transaction entails the emergence of an obligation from unjust enrichment (Article 1102 of the Civil Code of the United States). For example, in one of the cases, the court recognized as legitimate the refusal of the seller to satisfy the requirement to apply the consequences of the invalidity of a void transaction, indicating that the disputed contract is not concluded, in connection with which the application of the method for protecting civil law, 167 of the US Civil Code, it is impossible (the definition of the Supreme Arbitration Court of the USA of 04.02.2009 No. 114/09). In another case, the court, referring to the norms of Art. 1102 of the US Civil Code, satisfied the customer's requirement to recognize the contract signed by the customer and the contractor, unclosed and recovery of the unjust enrichment from the contractor, indicating that the contractor received funds in the absence of legal grounds for this (FAS Ural District Order No. F09-2319 of April 23, 2009/09-C5). The only thing that it is necessary to pay attention to the courts is that in itself the fact of the recognition of the contract as invalid or unincorporated can not entail any consequences specified in cl. 167 of the Civil Code of the United States, nor the consequences specified in Art. 1102 Civil Code of the United States. It is necessary that an invalid or incomplete contract be executed.

In addition, courts need to take into account that the consequences of invalid transactions are more diverse and are not limited to the return of the monetary value received or the refund of its monetary value. For example, according to Art. 169 of the US Civil Code, a transaction committed for a purpose that is known to be contrary to the foundations of the rule of law or morals is void. In cases provided for by law, a court may recover all the transactions received by such parties intentionally, or apply other consequences established by law, to the income of the United States.

In addition, we consider it possible to agree with VA Kiyashko that the consequences of invalid and failed transactions must differ in the order of application. As the author correctly notes, the consequences of failed transactions, unlike invalid transactions, can not be applied "automatically", i.e. court on their own initiative, as well as on the suit of others, except parties, interested parties, since the failed transaction violates the private interests of the parties. Consequently, the application of the consequences of an invalid transaction on the initiative of the court itself or on the claim of any interested person is an intrusion into the sphere of private interests.

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