Study On Contract Damages Compensation To Expectation Interests

The breach behavior of the parties to the contract leads to contract damages. Thecompensation system of contract is an effective system, which is most used to solve thecontract dispute in our contract law. It is always a controversial theory that is aboutwhich losses to the breach of contract should be compensated and which ones shouldnot be compensated. In the controversial theories, especially that if the losses of theexpectation interests of contract should be compensated is a controversial one before theissuance of the new contract law. In judicial practice, each court deal with the similarcontract disputes with different results. The compensation for damages of expectationinterests of contract has a legal basis after the issuance of the new article113of thecontract, and explicit provisions should be followed to relieve the losses of expectationinterests of contract. However, the compensation to the losses of expectation interests ofcontract is provided only in one article and this article is provided broadly, so in thetheoretical circle and in the judicial practice,there still has many problems whichshould be researched and explicit; Such as the legal characteristics of expectationinterests、the difference between the interests of the constitutive requirements, theexpectation interests of the elements, the interests of the contents, the compensationprinciples, calculation methods. This essay is based on this idea to considerate andwrite.This essay includes the following five parts:The first part: the concept of expectation interests, the legal characteristics ofexpectation interest and the difference between the interests of the constitutiveequirements. The concept of expectation interests comes from Anglo-American law.American scholars define the expectation interest as "the formation of the expectedvalue of plaintiff is based on the promise of the accused ". For this concept, scholarsbasically have reached a consensus. The legal characteristics of expectation interestinclude expectation, practice, some certainty, acquirability.The expectation interest of the contract interest is an important part and it has itsown unique legal characteristics.But in the judicial practice, it is also confused easily with other contract interests,such as reliance interest, indirect benefits, acquirability, etc. This essay differentiates theexpectation interests and trust benefits on emphasize, and discriminates the tow connotations and the tow basis of the compensation of contract damages in detail.The second part: The practical law of the contract to the compensation forexpectation interest damages and legal values. Expectation interest is an importantcontract interest. The protection of expectation interest can promote the contracttransaction security in a nation or a region. Therefore, in1854the UK founded thefamous case---Hadley v. Baxendale, which establishes the range of the compensationfor expectation interest damages and the compensation principle. Many nations makereference to this case and this principle produced by the case, and these nations enactrelevant rules about the compensation for expectation interest damages. The Article113in our country’s new contract also enacts the provision of the compensation forexpectation interest damages. Such regulation has largely advocates the contractfairness and contractual justice idea; Commercial transaction order and the principle ofgood faith also get huge maintenance.The third part: The key consists of responsibility for compensation of the damageof the expectation interests When the observant party requires the defaulting party tobear the responsibility for the damage of the expectation interests, the followingconditions must be strictly met:(1)the contract must be established and effected;(2)theexistence of branch of contract;(3) the Impaired expectation interests must bereasonable and predictable;(4) causal relationship between the behavior of branch ofcontract and the result of damage should be exist.The forth part: the principles of the compensation for expectation interest damages.As the expectation interests is a kind of interest that may happened in the future, so thescope of the compensation must be strictly limited and must abbey certain legalprinciples. One of the most important principles is the rule of predictability that hasstrict requirements in forecast is the main body, time and content. In addition, theprinciple of mitigation, the balance of profit and loss and Reasonable Certainty also arecorresponding limit.The five part: the calculation of the compensation for expectation interest damages.In the judicial practice, the greatest difficulty for the compensation for expectationinterest damages is calculation. In this essay, we expected to solve the difficult incalculating of the compensation for expectation interest damages with the analysis thethree standards and contract law, estimation method, presumptive method.With the analysis of the problems in the compensation of expectation interests dueto the breach of contract, we hope to promote the contract law to be further developed and to be more perfect in our country, and also to be helpful in dealing with theproblems in the judicial practice.