On Damage Compensation For Breach Of Contract

Precontract is different with the contract, the parties sign the precontract for the purposeof signing the contract in the near future. According to the Interpretation of the SupremePeople’s Court on the law applicable to contract cases, the parties sign subscription book,letter of intent, the memorandum appointment contract, agreed to conclude the contract in acertain period of time, if one party refused to conclude the contract in the future, the otherparty could request the party who breaks the contract to bear the compensation or terminatethe contract. This is a judicial interpretation to fill the gaps in our country about theappointment contract legislation in the past. This judicial interpretation although makeregulations that the party can demand compensation or termination about the contract, but thelaw does not make the specific stipulations about the forms of the obligations when one partybreak the contract. Since the focus of breach of contract law is the issue of compensation,therefore, this article will focus on the problem of compensation for breach of contract. Thispaper consists of five parts:The first part is the basic theory about the precontract and the form of the breach of thecontract. This part mainly introduces the concept and the character of the precontract, and thedifferences between the precontract and the other similar concept. Then this part introducesthe form and the result of breaking the precontract. The last part introduces the basic theorywhy we should compensate the breach of the contract.The second part is the identification of compensation about the breach of the contract.Firstly, this paper compare the liability for breach of contract and defects liability, inaccording to further clarify the responsibility of breach of contract. Secondly, this paperintroduces the principle of imputation and the element about the breach of the contract, inorder to understand the scope of application of the compensationIn the third part, through the horizontal comparison, we can get a better understanding ofthe differences between the liability for breach of the contract and other similar liability, suchas, the actual responsibility, the actual responsibility, liquidated damages.The fourth part is the key part of this paper. This part will introduce the reliance interestand the performance interest. In this way, we can clarify the scope and the limitation of thecompensation. In the last, this paper discuss the hot issues-price differences. The fifth part is a summary, it is a brief summary of the argument. In order to improveour rules about the precontract, we should get a better understanding of the scope andlimitations of the compensations.