The Restrictive Rules Of The Scope Of Contract Damages

The scope of damages caused by the breach of contract is a controversial issue both in theory and practice. This study investigates the restrictive criteria regarding the scope of damage. Chinese law stipulates four types of restrictive rules:foreseeability, contributory negligence, mitigation and compensatio lucri cum damno. This paper mainly analyzes four restrictive rules in terms of definitions, history and related cases. And then discusses their practical significance on how to improve the legislation of Chinese law.Part one introduces the principle of full compensation and the restrictive rules system of Chinese law.Part two analyses the principle of foreseeability, it starts from the history of foreseeability by reviewing a serious rules and definitions that are originated from the famous Hadley v. Baxendale case and its influence on the enactments of other countries. I then discuss the elements of foreseeability, including the foreseeable party, the foreseeable time and the foreseeable extent. Last, The studies on expenses and the practice of foreseeability in Chinese legislationThe third part concerns contributory negligence, including its history, constituents and judicial practice in China. It mainly analyses the controversy of the necessity of this rule.The forth part is about the mitigation rule. Having introduction of the definitions and judicial practice of the rule, I propose my judgments of reasonableness and four major methods to mitigate the losses by analyzing two case studies.The fifth part investigates the conception, Legislative practice and elements of compensatio lucre cum damno rule, and analyzes its theoretical basis and the calculation problems in practice.The final part is concludes the paper. After the analysis of the four restrictive rules, I point out some problems in their application and give some suggestions regarding how to improve the legislative and judicial practice of these four restrictive rules of contract damages in China.Adopting comparative analysis and case studies as two main methods, This paper compares these four restrictive rules in respect of elements, theoretical development and legislative practice and analyzes the judicial application of cases from home and abroad in respect of case facts, judgment’s opinion, and influences on theoretical development. This study is thus designed to investigate the practical significance of restrictive rules in trial and Chinese law at large. Although there are a number of scholars studying these four restrictive rules of contract damages in China or abroad, the author makes some innovative contribution to the following aspects:First, an innovative topic. Having searched the articles related to restrictive rules, I find few of them probing deeply into the four restrictive rules. They instead either prefer to extensively discuss these rules in a single chapter or restrict their research only to one type of these rules.Secondly, many publications of contract law simply touch upon the theories. However, my paper not only introduces the basic theories, but also analyzes the cases in china and abroad, Moreover, judgments’ opinion are provided in the introduction of the theoretical development.Thirdly, the novelty of the theories and legislations. Because of the enactment of the latest judicial interpretation of contract law by the Supreme Court, some parts of this paper has never discussed in other articles previously, for example, the necessity of contributory negligence rule.Lastly, the author concludes this paper by putting forward some creative suggestions on the legislative and judicial practice, such as the unity of legislation and the scope of the application of restrictive rules.