Reliance Interest In The Contracting And Compensation Study

There is no dispute that reliance interests should been protected in theory and in practice. However, what's the reliance interest hasn't been represented in the way accepted by most of the people due to the situation that no attention has been paid to reliance interests by orthodox lawyers. The intension of reliance interests is very important because the constitution of reliance interests compensation, the sphere of application and scope of compensation is determined by it. Traditional theory of civil law believes that the reliance interests is the loss caused by void of contract while the party relies on the formation and validation of contract. However, many mistakes exit in this opinion in theory or in practice. The study on reliance interests compensation is also influenced by these mistakes. Since, the author will research into the real intension of reliance interests again in this article, at the same time, discuss the problems of compensation on this basis. This article contains the following six parts: the intension of reliance interests, constitution of compensation, basis of requisitional right, sphere of application and scope of compensation, at last make a self-criticism on the protection to reliance interests in our country.Actually, in the process to sign a contract the object that the party relies on is the conduct of signing a contract, not the validation of contract. In surface, the reason that causes the loss of reliance interests is the void of contract: but the essential reason is that the party relies on the other party's conduct of signing a contract which violates the obligation of good faith. Sometimes the conduct of signing a contract"against the principle of good faith won't lead to the void of contract, but will cause the damage. In this situation, the loss of reliance interests should been compensated in spite of the validation of contract. So, the reliance interests is the interests that emerges when the party relies on the other party's conduct of signing a contract and is damaged when the other party's conduct is against the obligation of good faith. The reliance interests exists in the process of alternating between inherent benefit and benefit of performance. The loss of reliance interests is the transaction damage. The inherent benefit appears in the form of personal right and property right; the benefit of performance appears in the form of jur in personam; but the reliance interests can't appears in the form of some rights. There is no right reflecting the reliance interests. This is because the conduct of signing acontract has happened before the party's reliance come into being. So the party can't own the right to require the other party act on good faith. The way to protect reliance interests is to compensate the damage, to relieve the party after the loss of reliance interest has been caused. The loss of reliance interests can't been caused by the action violating the previously conclued obligation of contract directly. On the condition that the party has reliance, then to bargain and sign the contract with the other party, the loss may happen. In broad sense, the reliance interests not only exist in the process of signing a contract, but also may emerge when the party relies on the third party's conduct. In this article, the author only research into the reliance interests in the process of signing a contract. Due to the protection to the reliance interests, the safety of transaction not only refers to ratify the conduct of transaction validation, secure the benefit of performance, but also refers to the safety of reliance interests in the process of signing a contract before the formation of contract. Whether the law ratifies the transaction conduct validation to secure the benefit of performance or compensates the loss of reliance interests is determined by the condition that whether the contract can been performed and whether the performance is permitted by law, and the choice of the party. The only way to protect the reliance interests is to compensate t...