The Supreme Court confirmed the price increase limit — no more than 10% of the contract value in public procurement

On June 17, 2026, the Supreme Court considered case No. 922/2430/25 on the claim of a private enterprise against a municipal organization to recover UAH 71,064,991.85, of which UAH 43,683,322.73 is debt for works, the rest are inflation losses and 3% annual interest.

According to the case, in May 2020, the parties concluded a contract for the procurement of construction works for building a feed kitchen with administrative and household premises at the Kharkiv Zoo. The initial contract price was over UAH 72 million, but during execution, the parties repeatedly changed deadlines and funding through a number of additional agreements.

The claimant stated that significant deficiencies in the design and estimate documentation were discovered during construction, requiring additional works. According to him, these works were effectively agreed upon by the parties through defect acts, meetings, and subsequent project adjustments, although formally no contract amendments regarding cost increases were made.

Overall, the claimant asserted that he performed works worth UAH 43,683,322.73 beyond the contractual scope, supported by acts of completed works and an expert examination conducted in 2025.

The defendant denied payment for additional works, referring to the Law "On Public Procurement" and the absence of a contractually stipulated possibility to increase the volume and cost of works, as well as the lack of budget financing.

The courts of first and appellate instances partially satisfied the claim and recovered UAH 43,683,322.73 of the principal debt, denying recovery of inflation losses and 3% annual interest.

Part 1 of Article 11 of the Civil Code of Ukraine provides that civil rights and obligations arise from the actions of persons stipulated by civil legislation acts, as well as from actions not directly provided for by such acts but which analogously give rise to civil rights and obligations.

Position of the Supreme Court

The Supreme Court recalled that according to paragraph 1 of part 2 of Article 11 of the Civil Code of Ukraine, the grounds for the emergence of civil rights and obligations include contracts and other transactions, other legal facts. Furthermore, part 3 of this article defines that civil rights and obligations may arise directly from civil legislation acts.

According to Article 509 of the Civil Code of Ukraine, an obligation is a legal relationship in which one party (the debtor) is obliged to perform a certain action or refrain from it in favor of the other party (the creditor), who has the right to demand fulfillment of such obligation.

According to part 1 of Article 526 of the Civil Code of Ukraine, an obligation must be properly performed according to the terms of the contract and legal requirements. Unilateral refusal or change of the obligation is not allowed (part 1 of Article 525 of the Civil Code), unless otherwise expressly provided by the contract or law.

According to Articles 626 and 629 of the Civil Code of Ukraine, a contract is an agreement of the parties aimed at establishing, changing, or terminating civil rights and obligations and is binding on the parties.

According to Article 875 of the Civil Code of Ukraine, under a construction contract, the contractor undertakes to perform construction works according to design and estimate documentation, and the customer undertakes to accept and pay for them. According to Article 854 of the Civil Code, payment is made after proper performance of works unless otherwise provided by the contract.

Articles 843–844 of the Civil Code define that the price of works is established by contract or estimate, which may be fixed or approximate. Changing a fixed estimate is allowed only by agreement of the parties. According to Article 877 of the Civil Code, the contractor is obliged to perform works according to design documentation and estimate, which determine the scope, content, and cost of works.

Thus, in disputes regarding construction contracts, it is necessary to prove not only the fact of performing works but also their compliance with design and estimate documentation. Exceeding a fixed estimate without the parties' consent is borne by the contractor unless otherwise established by law. According to part 5 of Article 844 of the Civil Code, an increase in a fixed estimate is allowed only in exceptional cases. The Supreme Court in its ruling dated 06.12.2019 in case No. 910/7446/18 stated that additional works are paid only if their necessity, unpredictability, and proper notification of the customer are proven.

The lower courts recognized grounds for payment of additional works; however, the Supreme Court noted that these conclusions are premature as they did not consider the specifics of the Law of Ukraine "On Public Procurement."

The Supreme Court stated that essential terms of a procurement contract cannot be changed except in expressly defined cases, and the price increase is limited to 10% and is imperative. The Grand Chamber of the Supreme Court has repeatedly emphasized that exceeding this limit contradicts the principles of transparency and fair competition.

Therefore, the courts did not properly assess the correlation between civil law norms and public procurement legislation, as well as the reasons for the difference between the contract price and the actually paid amount.

In this regard, the Supreme Court canceled the courts' decisions in part of satisfying the claim and sent the case for a new trial.

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