Annals 2022 | Vol 70 | 5
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    • EDITORIAL BOARD 2022
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    • Editorial Board 2022
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    EDITOR’S NOTE

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    Mihailo Konstantinović (1897–1982): A Jurist Who Defined an EraThe article provides a biographical overview of the life and work of Mihailo Konstantinović, professor at the University of Belgrade Faculty of Law and corresponding member of the Yugoslav Academy of Arts and Sciences. This contribution covers his education, university and scientific career, political engagement, work on legislation and in professional associations. The article reflects on the contribution of Mihailo Konstantinović to Serbian legislation and jurisprudence and the recognition he deserved, as well as on the controversies of his life and work, concluding that a more detailed study of his character and work is undoubtedly necessary.

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    Mihailo Konstantinović and the Transformation of the Private Law in Serbian and Earlier Yugoslav Law The Serbian and previous Yugoslav public knows little about Mihailo Konstantinović, one of our greatest jurists. The reason for this is the fact that he published a modest number of scholarly papers. When asked why he had not written more, Konstantinović responded that he did not consider it beneficial to write treatises and commentaries in a situation where the laws did not exist or were not properly drafted. Hence, he decided to focus on writing laws and not books about law. After the Second World War, Konstantinović was the sole redactor of a number of draft laws in the most important fields of private law, i.e. family law, inheritance law and law of obligations. A number of his original texts have been amended or supplemented over time, but the fact remains that even today a significant number of his ideas guide legal relations in the countries of the former Yugoslavia.

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    Mihailo Konstantinović on Working on the Civil Code in Inter-War Yugoslavia The paper analyses the work on the codification of the civil code in interwar Yugoslavia and Mihailо Konstantinović’s opinion of that work, which lasted almost a decade and a half but did not lead to the adoption of the code. The paper describes the environment and circumstances in which the work on codification began, the main actors, their positions, the method of codification, and the outcome of that work – the creation of The Pre-Draft of the Civil Code for the Kingdom of Yugoslavia. Mihailo Konstantinović’s opinion on that work begins with the history of the creation of the Serbian Civil Code, and how it happened that the Austrian Civil Code was used as the basis, as opposed to the French Civil Code. Konstantinović’s arguments for why it was wrong to use the Austrian Civil Code, instead of the 1888 Montenegrin General Property Code are presented.

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    Federalist Mihailo KonstantinovićMihailo Konstantinović, together with his colleagues Mihailo Ilić and Đorđe Tasić, served as counsel to Prime Minister Dragiša Cvetković committed by Prince Regent Pavle to reach agreement with Vlatko Maček, the leader of the strongest Croatian political party. The August 1939 agreement resulted in the creation of the Banovina of Croatia, which thus obtained special status within the Kingdom of Yugoslavia. Konstantinović took part in the negotiations and significantly contributed to the drafting of the accompanying decree. The intention of the parties to the agreement, in line with the Prince Regent’s, was in the direction of introducing federalism in Yugoslavia. Konstantinović very much engaged in such efforts and drafted a decree that was to create the Banovina of Serbian Lands. Political circumstances, as well as the war, impeded the implementation of such ideas, but Konstantinović nevertheless proved himself a convinced federalist.

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    The Role of Mihailo Konstantinović in the State Redesigning of the Kingdom of YugoslaviaMihailo Konstantinović is well known to the Serbian and Yugoslav audience as one of the greatest civil law lawyers of his time. He was active in the state administration immediately before and after the Second World War: first, as a minister in the Cvetković–Maček Government, 1939–1941; then, as a chairman of the 1946 Constitution-Drafting Committee. Prior to the Second World War, he was also legal sciences teacher to Crown Prince Petar Karađorđević II. However, Mihailo Konstantinović was also a politician in the best meaning of that term, a true statesman, more specifically, the chief architect of the 1939 Cvetković-Maček Agreement, which represented an attempt to save the Kingdom of Yugoslavia from breaking up. This article aims to shed light on the role he played in the state redesigning of the Kingdom of Yugoslavia and on the complexity of his personality, which was revealed through this role.

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    Between Ketman and Defense of the University Profession: Mihailo Konstantinović in the Academic Purges During the 1940sUnder Communist rule in Yugoslavia a university professor could either raise his voice and pay a high price, join the Party or accept the ketman practice. Mihailo Konstantinović tried to find a fourth way: retain the office, not cross to the red side and avoid being perceived as a ketman. Konstantinović was absent at the meeting of the Faculty’s Council in 1946 when Dragoljub Jovanović was expelled. When in 1947 Communist students required removal of professors Milan Vladisavljević and Đorđe Mirković, Konstantinović was one of the professors who defended them, exposed to attacks by his communist colleagues. The Council eventually relinquished the decision to higher authorities and Vladisavljević and Mirković were consequently dismissed. The following year assistant professor Milivoje Marković was targeted but due to the Communist pressure fewer colleagues defended him. Konstantinović did not take a stand on that occasion. His most important goal was to preserve the Faculty.

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    Contribution of Mihailo Konstantinović to the Modernization of the Yugoslav Economy – The Establishment of the Foreign Trade Court of ArbitrationThe Foreign Trade Court of Arbitration in Belgrade is one of the historic landmarks left behind by Mihailo Konstantinović. Professor Konstantinović was one of the main proponents of the establishment of this institution and he served as its first president. In that capacity he was in a position to steer the work of the FTCA so that it gained the trust of the business community as quickly as possible and became a reputable arbitral institution both in Yugoslavia and abroad. Records show that the Belgrade Court of Arbitration soon became a leading arbitral institution worldwide and its influence spread far beyond the Yugoslav market. The article presents and analyzes different methods and instruments that Professor Konstantinović used to develop the FTCA and shows how the successful establishment of this institution brought arbitration in Yugoslavia and Serbia into the modern era.

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    Mihailo Konstantinović on Right of Reply and on Abuse of Right of Reply Bonus: Author’s Understanding of Right of ReplyMihailo Konstantinović authored the region’s first monography on right of reply in 1926–1927. His monography promoted the French model of right to reply, as opposed to the German model adopted in local literature, the courts and legislation. He argued that French solution was stricter for the press, but less stringent for a rights holder. He defended the position of the relative nature of right, which could be controlled by implementation of the abuse of right doctrine. The author analyzes: the suitability of the terms réponse and others; rights close to right of reply; the purpose and nature of right of reply; exceptions to the right and prohibition of abuse of rights as subsidiary exception; the special place of right of reply among another subjective rights; right of reply not corresponding to legal binary code, representing a juncture of law and legal indifference; possessory protection vs. personality protection through reply.

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    Divorce of Marriage Due to Severe Deterioration of Marital Relations: The Creation of Professor Mihailo KonstantinovićThe article highlights the severe deterioration of marital relations as laid down for the first time in the Yugoslav Basic Law on Marriage in 1946 thanks to Professor Mihailo Konstantinović. Over time, different interpretations of some controversial issues related to the application of this provision have appeared in legal literature and judicial practice; in the first place, whether the spouse who is responsible for the disruption has the right to initiate divorce proceedings, as well as how the exclusive responsibility for severe deterioration can be determined. On the other hand, the insufficiently precise provision on the consensual request for divorce opened the way for discussions about whether the Basic Law recognized consensual petition, which was resolved by judicial practice by interpreting that the joint petition was recognized and given the significance of divorce on the basis of an agreement between the husband and the wife.

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    Normative Construction of the Life Care Contract in the Draft Code on Obligations and Contracts and in the Predraft of the Civil Code of the Republic of Serbia The article provides a comparative analysis of the legislative proposals contained in the Draft Code on Obligations and Contracts and the Predraft of the Civil Code of the Republic of Serbia. The text explains the historical development of the life care contract in Serbian legislation and the circumstances that formed it and placed it into codification devoted to law on inheritance. The author is strongly critical of the proposals in the Predraft because its authors did not take advantage of the opportunity to create new rules that would be adequate in contemporary circumstances, but rather copied the existing rules of the Law on Inheritance, which have long been recognized as deficient in certain aspects. The author concludes that the life care contract deserves a new and more comprehensive legislative regime, which would respond to practical needs and solve existing dilemmas.

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    Legal Guarantees of OwnershipOut of many civil law topics that Mihailo Konstantinović dealt with, the author analyzes the institute of ownership, i.e., the issue of legal guarantees of ownership. Namely, Konstantinović wrote about the notion of the ownership, pointing out that in different times ownership was defined differently and that property owners throughout history did not always have the same scope of authority. In this way, Konstantinović opened the issue of the limitation of ownership and problematized the idea of its inviolability. This paper, inspired by Konstantinović’s lines on the “ownership issue”, analyzes the concept of legal guarantees of ownership. The paper also offers criteria for distinguishing the term ownership limitation from related terms, considering that precise terminology is the basis of the system that forms the backbone of property law. Thus, the key part of property law could be systematized through three units: ownership, limitations, and deprivation of ownership.

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    Konstantinović's Concept of Limitation of Claims: Have the Ideas About the Time's Influence on Law Withstood the Influence of Time?Mihailo Konstantinović was the author of the 1953 Act on Limitation of Claims. The article explores how he improved and surpassed the rules on limitation set forth in the Austrian Civil Code which had previously been directly or indirectly applicable in a large part of the former Yugoslavia. His cornerstone ideas were later also copied with minor changes (partly not well thought through) into the Law on Obligations, ensuring there was no need for a comprehensive reform for decades. Admittedly, modern guidelines on limitation propose somewhat different concepts, focusing increasingly on the balance between the creditor and the debtor and on the simplification of the system. However, these guidelines are based on the modern discourse on human rights in private law and on the negative experience of some European jurisdictions with outdated and untransparent rules on limitation which – as opposed to the former Yugoslavia – remained unchanged for a century or more.

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    On Prohibition of Assignment When the Assignor's Account Is Blocked: A Contribution to the Theory on the Existence of Forbidden Contracts That Are Not Sanctioned With Absolute NullityThe author tries to resolve а legal issue raised in Serbian court practice: does the norm that prohibits the settlement of a monetary obligation via assignment of claims, in situations where the assignor’s account is blocked for the purpose of forced collection, represent by nature a norm: lex plus quam perfecta, or a norm: lex minus quam perfecta (Article 5 of the Law on Payments by Companies, Entrepreneurs and Natural Persons). According to the Serbian Supreme Court of Cassation, the misdemeanour liability for infringement of the prohibition of assignment cannot exclude the absolute nullity of legal transaction as a civil sanction, as specified in Article 103 of the Law on Obligations. On the contrary, the author argues that the repressive and preventive purpose of interpreted legal rule is achieved by the enhanced penalty, while the legal transaction undertaken contrary to the prohibition remains valid and in force.

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    Liberatory “Accession” to Debt: An Overlooked Institution of the Draft Code on Obligations and ContractsAll the provisions of the Yugoslav, and subsequently Serbian, Law on Obligations of 1978 relating to substitution of debtor, originate from the Draft Code on Obligations and Contracts of 1969. However, the rule according to which the creditor and the third party may expressly discharge the original debtor was omitted from the Law. The reasons for this exclusion have not been recorded. Also, the Draft fails to specify whether the original debtor may protest their own release, i.e., if their consent is necessary for the discharge. This article has two purposes: to explore how the ideas of Mihailo Konstantinović, the sole author of the Draft, on the subject of substitution of debtor developed over time, and to examine the omitted rule on liberatory “accession” to debt or, more precisely, the assumption of debt by agreement between the creditor and a third party.

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    An Outline of the Rules on Set-Off in Serbian LawThis article contains a critical review of rules on set-off in Serbian legislation and court practice. The author provides a comprehensive overview of this institution by answering the main issues which arise in connection to set-off from the perspective of Serbian law. The research takes into account leading academic proposals for regulating set-off, as well as legislation, experience and academic discussions from legal systems which are closely related to Serbian law and may serve as a model. The author concludes that the Serbian Obligations Act provides adequate and clear rules, but that the accepted concept of set-off is being abandoned in European legal theory, which should be a reason to contemplate its fundamental reform. As the weakest point of Serbian rules on set-off, the author underlines set-off in judicial proceedings which has developed into a special type of set-off and undermined the idea of a unified substantive law of set-off.

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    Mandatory Rules in Recent Serbian Jurisprudence and Contractual PracticeFreedom of contract and non-mandatory statutory rules are characteristics of the law on contracts. Mandatory provisions are exceptional and their violation leads to the invalidity of contract and other consequences. Freedom of contract assumes that the rules are non-mandatory, while the exception is to be determined. In a number of cases jurisprudence wavered, and the courts tend to defend their position that a rule is mandatory by invoking the unacceptable position that the statute has not explicitly allowed different contracting. By contrast, Anglo-Saxon legal institutions representations and warranties and put option are often incorporated in international agreements in which Serbia’s law is accepted as applicable, especially in agreements on the sale of shares in limited liability companies. In such cases the jurisprudence is not always willing to recognise and apply mandatory provisions of Serbia’s law. In the paper the examples of such practice are subject to a critical analysis.

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    Breach of Contract: The Draft Code on Obligations and Contracts and the Law on ObligationsThe paper presents an analysis of the regulation of termination of contract due to a breach in the Yugoslav Law on Obligations (1978) and the Draft Code on Obligations and Contracts (1969), prepared by Mihailo Konstantinović. In the area of termination of contract, Konstantinović’s primary source of inspiration was the Uniform Law on the International Sale of Goods (ULIS, 1964). The regulation of breach of contract in the Draft Code is not based on a uniform notion of breach of contract, rather, there are different types of breaches: non-performance (debtor’s default), defective performance, and impossibility of performance. The Legislative Commission, making changes to the Draft Code, retained its structure, including the regulation of different types of breaches, but made changes with regard to termination of contract. Compared to modern model laws, these changes represent some of the key shortcomings of the regulation of this area in the Law on Obligations.

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    Liability for Defects in Sale of Things With Digital ElementsThis paper presents the issue of liability for material defects in relation to things with digital elements. Croatian law was recently amended in this field as a consequence of implementation of the Directive (EU) 2019/771, and this paper compares the provisions of EU law with the Croatian law and the legal systems of some other EU member states. The focus of the paper is liability for material defects of things with digital elements, and consequently, the notion of things with digital elements is analyzed along with provisions on defects of such things, updates of things with digital elements, and defects in contracts for the continuous supply of digital content and digital services.

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    Laesio Enormis in Serbian Law and Its Relationship With Other Related Legal InstitutesMihailo Konstantinović raised important issues regarding how laesio enormis should be applied and regulated in the future, given the inconsistency in the post-war judicial practice. Konstantinović supported the view that laesio enormis should be governed by an objective principle. However, in the Law on Obligations, the right to annul the contract due to obvious disparity between contract obligations exists only if the aggrieved party was mistaken about the true value of the performance when concluding the contract.In this paper, the author raises the question whether such a shift in the regulation of laesio enormis represents an improvement or serious arguments can be raised against it. Тhe author first analyzes how laesio enormis is regulated in comparative law, and then discusses the pros and cons of regulating this legal institute according to an objective and subjective principle.

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    Distinction Between Right to Compensation for Damages and Right to the Insured Amount According to Mihailo Konstantinović: Classic Institutes and Modern LawAuthor arguments that the distinction between the right to compensation for damage and the right to the insured amount originates from the work of Mihailo Konstantinović. Although the Draft Law on Obligations and Contracts does not regulate all types of insurance, Konstantinović has clearly and precisely stated that “the insured amount received by the insured party from the insurance company does not replace compensation for damage to which the party is entitled, according to the general rules on compensation for damage.” This wording has not lost its relevance today. Conversely, it is more relevant than ever. Based on the work of Mihailo Konstantinović, the author presents the argument that the Serbian regulatory framework is a limiting factor to the development of the insurance market. A favorable legal framework does not limit insurance according to the type of insurance, but recognizes the type of coverage and the nature of contracted obligation.

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    Comission Agency – Certain Open IssuesA particularity of commission agency is that the commission agent acts in its own name, but for the account of the principal. The provisions of the Law on Obligations leave certain practical issues conclusively unresolved, and such issues have been encountered both in doctrinal analysis and in case law. The article analyzes some of the issues that, while being relevant in practice, have not been subject to scrutiny recently, such as the content and reach of the obligation of the commission agent to act in accordance with the instructions of the principal, the principals rights over chattels, and claims acquired by the commission agent or held by it, implications of the provisions of the law regulating the rights of the principal in case of bankruptcy of the commission agent, and the consequences of commission agent’s belated transfer of monies received or even unauthorized use of monies belonging to the principal.