The Research On The Effect Of The Contract For The Benefit Of A Third Party

The essay focuses on the effect of the contract for the benefit of third party. Firstof all, a brief introduction of the contract for the benefit of third party is given in theessay. Secondly, the root of effect of contract for the benefit of third party is studied invarious perspectives. Finally, obligation default in the performance of contract isexpounded in the essay.The first chapter summarizes the main feature of the contract for the benefit ofthird party. To start with, in the process of defining the contract for the benefit of thirdparty, the difference between the contract for the benefit of third party and non-realcontract for the benefit of third party is made. In the next place, the essay reveals thestructure of the contract for the benefit of third party and illustrates the function ofeach part. As a result, the item for the benefit of third party shall be regarded as a partof the contract for the benefit of third party rather than an independent legal action.Lastly, the contract for the benefit of third party is compared with the similarinstitutions which include agency, credit assignment and trust in order to highlight itsown characteristic.The second chapter mainly explores the source of validity of the contract for thebenefit of third party. The argument of source of validity is divided into two parts.One is in perspective of function; the other is in perspective of nature. The former expounds source of validity of the contract for the benefit of third party in perspectiveof realizing the goal of justice, maintaining private law order and maximizing thebenefits. The latter holds the view that the validity the contract for the benefit of thirdparty stems from the binding effect of the contract entered by the parties which is inaccordance with the nature of civil law when compared with all various theorieswhich try to explain the reason. Then conclusion is justified in method as follows:First, it shall start in the view of classic voluntarism. Then the nature of right shall beanalyzed as well as taking unilateral promise as an example. Lastly, in comparisonwith other theories, the advantage of the conclusion is testified.The third chapter focuses on the specific effect of the contract for the benefit ofthird party. The main subject of this chapter is obligation default in the performance ofcontract. Generally speaking, obligation default can be attributed to debtor, creditorand third party. The creditor and third party are entitled to compensate for damagesagainst debtor when the obligation default is attributed to debtor. Meanwhile, thecreditor is also entitled to terminate the contract. With respect to the damages, notonly does third party has right to request compensation, but also creditor is entitled toclaim compensation for the damages according to the legal relation between him andthird party under certain conditions. As to legal right to terminating contract, thecreditor is entitled to terminate the contract without consent of third party. The debtoris entitled to exercise the right of defense against third party when the obligationdefault can be attributed to creditor. When certain conditions are satisfied, debtor isentitled to terminate the contract in order to recover the interest he has paid, and theobligation shall be assumed by creditor. As for right of defense, it mainly illustratesthe foundation and scope of the right of defense. In the case of terminating thecontract, the restitution obligation shall be assumed by creditor. Under certaincircumstance, third party also shall assume additional obligation which is probably tolead to a disadvantageous legal effect for him.