Russia, Star Wars, and Contract Modification

It's not always I can connect Russia, Star Wars, and contract modification in one blog post!

This morning, Russia's Federal Security Service (FSB) said that it will drop the case against the Wagner paramilitary group, after its fighters staged an attempted rebellion on Saturday that threatened President Vladimir Putin’s leadership. Interestingly, the statement did not mention Wagner leader Yevgeny Prigozhin by name.

This comes after Saturday’s news when the Kremlin announced that Prigozhin will move to Belarus in a deal to end the insurrection. As part of that announced deal, the criminal case that had been opened against Prigozhin for armed mutiny would be dropped, and that the Wagner fighters who had taken part in the insurrection would not face any action.

However, according to Russian media reports published yesterday, the criminal case against Prigozhin remains open and the charges against him have not been dropped. If in fact the proceedings continue, Prigozhin could face up to 20 years in prison.

This led one analyst on CNN This Morning to explain that the circumstances that led to the deal on Saturday is not necessarily the same circumstances that currently exist, analogizing the situation to Star Wars—yes, Star Wars and, The Empire Strikes Back, in particular.

Ian Brewer, president and founder of Eurasia Group: I think the timing was enormously problematic for Putin. I mean, if he had decided to engage in a full fight with not just Prigozhin, but all of the Wagner forces under him in Moscow, one, you don't have certainty in how the Russia's defenses are going to actually act on the ground, in that sense, you also are fighting front lines against the Ukrainians …

Poppy Harlow, CNN anchor: So, it's a matter of time. Bremmer: I assume it's a matter of timing, and that Prigozhin is in a very different situation. You remember, I think it was Empire Strikes Back on Bespin when they said, pray that we do not alter the terms of the deal any further. I think that Putin is in the role of Darth Vader right now.

What Bremmer was explaining was Putin’s unilateral attempt to modify the terms of the deal that moves Prigozhin to Belarus. On Saturday, on a brink of a possible insurrection, Prigozhin had the upper hand. Now, not so much, which gives Putin the opportunity to potentially change the terms of Saturday’s deal.

Well, what happened in The Empire Strikes Back? Lando Calrissian makes a deal with Darth Vader that involved luring Luke Skywalker to the Cloud City of Bespin with the use of his friends.

Lando Calrissian: Lord Vader, what about Leia and the Wookiee?

Darth Vader: They must never again leave this city.

Lando Calrissian: That was never a condition of our agreement, nor was giving Han to this bounty hunter!

Darth Vader: Perhaps you think you're being treated unfairly.

Lando Calrissian: No.

Darth Vader: Good. It would be unfortunate if I had to leave a garrison here.

Later, when Han Solo was finally encased in carbonite, Dark Vader changed the terms of the deal further:

Darth Vader: Calrissian. Take the princess and the Wookiee to my ship.

Lando Calrissian: You said they'd be left at the city under my supervision!

Darth Vader: I am altering the deal. Pray I don't alter it any further.

The scene in The Empire Strikes Back is a good example of when a final contract can—or rather cannot—be modified.

So here's what you need to know for the bar exam:

First, it’s important to note that the common law of contracts, which applies to services contracts, would apply to Darth Vader's agreement with Lando: Lando would turn Han Solo over to Boba Fett, and his friends—Princess Leia, Chewbacca, and C-3PO—would be safe under Lando’s care on Bespin.

Under the traditional common law view, a final contract cannot be modified unless the modification is supported by new consideration. Certainly, Lando didn't provide any new consideration.

The modern view is different, permitting modification without consideration if: (1) the modification is due to circumstances that were unanticipated by the parties when the contract was made and (2) it is fair and equitable. Neither existed in The Empire Strikes Back.

So it appears that Lando would have a valid cause of action for breach of contract against Darth Vader!

As a side note (and for the sake of thoroughly reviewing the rule for contract modification), if the contract were for the sale of goods, Article 2 of the Uniform Commercial Code would apply to the modification. Under the UCC, promises of new and different terms by the parties to a sales contract are valid without consideration. However, good faith is required to make a modification enforceable.