Court-imposed penalties in the framework of the new code on execution procedure

Court-imposed penalties are a measure that is used more and more often by creditors in domestic commercial transactions as a very efficient instrument of influence (and compulsion) on the debtor to perform his non-monetary obligation confirmed by a final judgment. This is an institution of the law of contracts and of the execution procedure which is regulated by the Code of Execution Procedure ('Official Journal of the Federal Republic of Yugoslavia ', no. 28/2000 that entered into force on July 8, 2000). The author makes a thorough analysis of the court-imposed penalties. He explains statutory conditions for ordering of this measure (as defined by the Code of Obligations and the Code of Execution Procedure), and the criteria of determining and reducing the amount of penalties. He points out differences between court-imposed penalties and other similar measures, such as contractual penalties and fines in the execution procedure. He further analyzes the relationship between court-imposed penalties and damages. The analysis is accompanied by a selected overview of the recent case law especially judgments rendered by commercial courts. These judgments clarify many uncertainties with respect to application of court-imposed penalties in particular in relation to legal persons as commercial actors.