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Study On Protection Of Pure Economic Loss

Posted on:2013-05-19Degree:MasterType:Thesis
Country:ChinaCandidate:G Y HuFull Text:PDF
GTID:2246330395488031Subject:Civil and commercial law
Abstract/Summary:PDF Full Text Request
Pure economic loss is a concept originated from common law states which has beenintensely discussed in civil law states. It is difficult to define this term in that it is not personalinjury,loss of property or loss of intangible property such as trademark and patent,whichleads to embarrassment in legal protection. This paper concerns on the discussion of legalprotection scope of pure economic loss through trying to make a relatively clear definitionand provides for protection based on the second article of “Tort Liability Law”, then putsforward some suggestions on judicial practice about pure economic loss.This paper is divided into six parts. The first part is the overview of the pure economicloss problem. Although the definition of pure economic loss has been seriously discussed anddebated, there is not a unified conclusion still. There are about two ways to define this term.One is from the view of “the subject matter violated” which emphasizes that the economicloss is not the loss leaded by violation on plaintiff’s physical or tangible property. The other isfrom view of “the protected interests”, aiming to emphasize that pure economic loss is notcovered by the legal protection. Through the two ways, we can draw that pure economic lossrefers to the nonprofit on pecuniary interests of victim, which is not caused by loss of absoluterights such as property and person.The second part is the comparative law study of pure economic loss. French law takes aopen attitude towards to pure economic loss,which did not distinguish the “harm” and “pureeconomic loss”, so as to maximize the protection of pure economic loss. But at the sametime, French law uses “fault””damage” and “causation” and other restrictive conditions toscreen and filter, so as to prevent lawsuits torrent and a waste of judicial resources. Germanlaw confines the protection extent to “right”, while the pure economic loss is protected byspecial legislation, expansion of contractual liability scope and extensive interpretation of thefirst clause of the article823. Common law states established the rule that pure economic losscould not get compensation, excluding the relief of victim. Later several cases gave protectionon pure economic loss, thus the established rule began to loose and crack. But, in general,Common law still persists in not giving compensation to pure economic loss though pureeconomic loss has gotten protection in individual cases.The third part is the dealing rule about pure economic loss: no compensation for the principle, compensation for the exception. There are some reasons about the “nocompensation on pure economic loss “:”litigation gate” theory,” the consideration of valuestatus of human, the need of legal certainty, the balance of tort liability and contract liabilityand social cost theory. However, it would harm justice if all pure economic loss have beendenied in an absolute simply way. Thus the “no compensation” rule was confronted kinds ofdoubt from scholars who proposed the rule that individual pure economic loss should beprotected. Typed protection scope of pure economic loss has been established based onconsideration of concerning factors: pure economic loss can be protected only in theseconditions that pure economic loss are led by intentional violation, negligent professionalperformance, flaw of goods and the pure economic loss is metastatic pure economic loss.The fourth part is the current situation about legal and judicial protection of pureeconomic loss in China. The promulgation of Tort Liability Law provides basis for protectionof pure economic loss. At the same time, there are a large number of special law and judicialinterpretation formulating protection on pure economic loss. However judicial practice takes aconservative attitude towards to protection of pure economic loss. Courts approve claimsabout pure economic loss only in specific cases that special law and judicial interpretationexplicitly give protection on pure economic loss, while other claims which enacted law doesnot approve can not achieve compensation.The fifth part is the protection of pure economic loss in the second article of “TortLiability Law “.Although a part of pure economic loss was incorporated into the protectionscope of contract law, it is unrealistic to expect contract law to solve all problems of pureeconomic loss, which may make contract law not only gross but also losing original authority.The promulgation of “Tort Liability Law” provides a feasible way for protection of pureeconomic loss. On one hand the second article of “Tort Liability Law “provides legal basis forprotection of pure economic loss, on the other hand the protection scope can be confined tosome extent through interpretation of the second article.The sixth part is some suggestions about judicial practice on pure economic loss. Firstly,the relationship between plaintiff and defendant can be confirmed through considering someelements such as “fault””damage””causation”. Secondly, lawsuit risks could be distributedbetween plaintiff and defendant through distributing the burden of proof. Thirdly whether andwhat to extent the plaintiff can be compensated need to balance kinds of factors. Finally, somesuggestions would be given about dealing pure economic loss in judicial practice.
Keywords/Search Tags:the Pure Economic loss, Article2of Tort Liability Law of China, Typification, protection
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