On The Principle Of Circumstances Changes Applying To In The Presale Of Commercial Housing Contract

The principle of circumstances change is a very important principle in themodern contact law. In May2009, the Supreme People’s Court recognized it by wayof Judicial Interpretation (Part Ⅱ) of Contract Law.As a matter of fact, the principle of circumstances change is used from time totime in the judicial practice of our country, especially in the presale of commercialhousing contract. Because the presale of commercial housing contract is a special salecontract, which has a long term, and involve a large number of funds. So it is easilyinfluent by the change of building materials price and land price, as well as thevolatility in financial markets and factors such as changes in national policy. Whensuch situations happen, if they must absolutely carry out the contract according to thecontract, it would cause one party’s great loss and be unfair to the party. At this time,the principle of circumstances change will come out. It aims tore-adjust the rights anobligation of the parties and eliminate the contract’s unfair result owing to thesituation’s great changes. However, the principle of circumstances change has verystrict application conditions, if it is abused in the judicial practice, it would not begood for the development of real estate market. To confine the application, we mustdiscuss the application conditions and effects of the principle as well as thecharacteristics of the presale of commercial housing contract. Since2010, China has carried out a series of notional policy adjustment aboutthe real estate market. Based on this situation, this article discusses in detail relatedissues of the principle of circumstances change applied in the contract dispute of thepresale of commercial housing contract, so as to improve the application of theprinciple.The article is divided into four chapters.The first chapter introduces the basic theory about the principle of circumstanceschange, including the definition and legislation of it.The second chapter analyzes the necessity and feasibility of the principle ofcircumstances change. The presale of commercial housing contract is a kind of specialform, so it can also apply principle of circumstances change to deal with the disputeof real estate.The third chapter examines the application of the principle of circumstanceschange in our country, including the application conditions and effects of the principle,to provide the theory basis and referee standard to resolve pre-sale housing contractdisputes.The last chapter gives several suggestions on how to improve the application ofthe principle of circumstances change in the presale of commercial housing contract,especially the difference among the principle of circumstances change, business risksand force majeure.