On The Validity Of Unauthorized Disposition Contracts

The Law of Contract prescribes the validity of unauthorized dispositioncontracts as undetermined, which causes misreading and misusing both theoreticallyand practically. However, The Supreme Court’s Explanation On Applicable Laws ToPurchase Contract Dispute Trials defines it as valid. Therefore, both creditorformalism and real right formalism can be used to interpret the validity ofunauthorized disposition. Starting with an introduction to the concept and theories ofunauthorized disposition, this paper analyzes real cases of Urumqi City from viewsof creditor formalism and real right formalism respectively. Presumed that creditorcontracts are segregated from real right contracts based on creditor formalism, therewould be a defect of waiving real right contracts. Only real right formalism, basedon the dichotomy theory of creditor right and real right in German Laws, considersthat the act of liability corresponds with the performance of one’s duty, and the act ofdisposition results in the change of real right. Eventually the paper reaches a logicalconclusion on the validity of unauthorized disposition contracts.