The Rescission Of Contract And The Liability For Breach Of Contract

In the contract law, there is no explicit and operable rules about whether the violationresponsibility, especially the liquidated damages clause will apply or not after the rescissionof contract. While in contract law’s traditional theory, the rescission and its reponsibility takenare two independent relief systems, thus the specialized study of them are mostly from theirown perspective, rarely combine them with each other.However, there exists long controversy in theory circle about this point aforesaid, and injuridical practice, there also exists lots of cases which have similar details but differentjudgments. This paper selects a classic case from official journal of the Supreme People’sCourt, combining the details of the case with existing theories, comparing with the similarcases at the same time, aiming at reaching a conclusion about whether the application of lawin this case is reasonable.Besides introduction and concluding remarks, this paper includes three parts.In the first part, this paper brings out the focus of disputes by retrospecting of the caseaforesaid. In the case,one party of contract can’t continue execution thus breach thecontract,the other party file a suit therefore,claiming for rescission of contract,as well asrestitution,liquidated damages and damages.The court support the claims except liquidateddamages,holding the opinion that the effect of contract rescission is wiping out the relations ofcontract.The second part mainly discussing the rescission of contract.Analyzing whether theapplicable of law is reasonable by combining related theories and the details of the case.Andin consideration of integrity of logics,paving the way for analyzing the problem ofresponsibility talking below by discussing from the angle of the purpose,causes and exerciseof contract rescission.The emphasis of the third part, at the same time of the paper, is the responsibility taking,especially whether the liquidated damages clause will apply or not after rescission of contract.This part starts from the disagreement of the two parties and the courts, discussing the effectof contract rescission first, which is the logic premise. On the basis of that the liquidateddamages clause will not definitely eliminate because of the rescission of contract, it bringsout the legal characters and the application relations with damages of liquidated damages byanalyzing of damages. Finally it reaches a conclusion whether the claim for liquidated damages is reasonable after the contract rescission,that is,even though the effect of contractrescission is wiping out the relations thereof,the purpose of it is not regard the contract asnever established before,on the contrary,in order to protect the unbreaching party,it necessaryto regard the contract as continuing in effect in the scope of relief relations.However,as thefunction of relief means overlapping in some ocassions,the applicable of liquidated damagesis not necessarily coexist with contract rescission.Finally,on the basis of this conclusion andcomparison with similar cases, I reach the conclusion of the dispute in this case.