A Study On The Exercise System Of Legal Rescission Right Of Contract

The exercise system of legal rescission right of contract is animportant system in modern civil law, and it has a long history, whichresources from ancient Roman law. The system of legal rescission ofcontract conforms to the development rule of the market-oriented economyin the modern society, and is benefit for maintaining the stability ofthe market-oriented economy, reducing the social instability, buildinga harmonious socialist society, and providing an effective approach toprotect the lawful rights and interests. But with the development ofsocialist market-oriented economy, the exercise system of legalrescission right of contract faces many arguments, especially theeffectiveness of legal rescission of contract， for example, theretroactive effect, the restitution, and the damages. Neither thetheories of Civil Law nor the theories of Common Law have formed aconsistent view.Contract law of the people’s republic of China absorbed the threeold Contract Laws, assimilated the advanced legislative experiences ofboth Civil Law and Common Law. The contract law realized the unificationof the trading rules, and reflected the connection with internationallegislation. The contract law is benefit for maintaining the honest credit as the cornerstone of the market-oriented economy in the modern society.Due to the exercise system of legal rescission right of contract in ourcountry is not able to guarantee the continuity of legislation effectivelyand solve the linking problem with other civil and commercial legislations,and neglects the work for the localization of legal transplant, theexercise system of legal rescission right of contract in our country isshort of operability in the judicial practice.Chapter one is a summarization of “rescission of contract”. Firstly,the author explains the definition of the rescission of contract and thelegal characters of the rescission of contract. Then, the author explainsthe reasons why the rescission of contract through consultation shouldnot be included in the system of rescission of contract. Secondly, in orderto understand the rescission of contract more accurately, the authorcompares the rescission of contract with the termination of contract andthe cancellation of contract.In chapter two, the author introduces the causes of the legalrescission right of contract. Firstly, the author introduces the causesof the legal rescission right of contract in Civil Law, Common Law andInternational Pacts. Secondly, on the basis of our Contract Law, theauthor introduces the causes of the legal rescission right of contractin our law. And then the author presents the suggestions for how to improveour legislative technique.In chapter three, the author introduces the effectiveness of therescission of contract. Firstly, the author discusses the questionwhether the rescission of contract has the retroactive effect. After that,the essay clarifies the relation between the retroactive effect and therestitution. Secondly, the author introduces the legal nature of therestitution, and the restitution should have the function to restore therights and the duties between the parties to a state which was equal to the state before the contract was set up. Thirdly, the essay clarifiesthe relation between the rescission of contract and the damages. Afterthat, the author clarifies the legal nature of the damages, and then theauthor discusses the extent of the damages.