The Option Of Bankruptcy Administrator In The Executory Contract

With the development of the socialist market economy, competition is becomingincreasingly fierce. Many enterprises face the risk of bankruptcy due to poor management.When companies enter into bankruptcy procedures, they often encounter such problem thatboth parties have failed to fulfill the contract. Bankruptcy law of foreign countries havemade specific provisions. The Bankruptcy law of China also has some relevantprovisions.According to Article18of our Bankruptcy Law, the bankruptcy administrator hasthe option of executing contract. In addition, Article42, Article53and Article69make somerelevant provisions. However, compared with developed countries’ bankruptcy law, ourprovisions on bankruptcy administrator’s Executory Contract are simple and scattered. Manyissues is not clear and controversial and still need to be further definite and deepen.The first part introduces the option of Executory Contract of bankruptcy administratorand analyzes the value basis, the connotation and the nature of the option. The value basis ofthe option is the maximization of the bankrupt consortium. The interests of both parties alsoneed to be paid attention except the maximization of the bankrupt consortium in order toachieve the balance of interests. Although Bankruptcy Law of many countries provides theoption to perform the contract, but the meaning of "Executory Contract Option" is notaccurately and clearly defined. The author also analyzes the problem. In addition, this sectionalso discusses the nature of the option. The author considers that it is a legal, substantive,composite right.The second part analyzes the main body, content, principles of the option. Bankruptcyadministrator, the debtor can exercise of the right. The option has three kinds, continualoption, negotiable option, terminal option. The most important principles is to maximize thebankruptcy property interests.Only in this way can we make all the creditors get fair pay.The third part the fourth part and the fifth part of this paper is the key part of this paperfocusing on the conditions and effect of continuing, transferring, and terminating ExecutoryContract. This paper mainly discusses the conditions for assignment to continue and toperform the contract in three aspects of the agreed conditions set, relief the previous,defaultto guarantee future performance. When the bankruptcy administrator selects to continue toperform the Executory Contract,the contract shall be valid, and can impact both sides of the creditor’s rights. After the execution of the contract is transferred, bankruptcy will completelydepart from the Executory Contract. The retroactive effect of executory contract is the focusof this paper.The sixth part of this paper is the conclusion, summarizing argument of this article.