Research In The Concept Of Reliance Interests In Contract

Reliance interest is a legal concept widely exist in contract compensation of both civil law system and common law system. In the civil law system, reliance interest is mainly mentioned in contract fault liability as a standard of calculated the damage of unerring party suffered. While in the common law system, reliance interest is a standard of calculated damage of non-breaching party. In our country, the concept of reliance interest is controversial. The controversial point is concentrated on three aspects:First, the definition of reliance interest; Second, reliance interest whether exists in contract breach; Third, the relation between reliance interest and other interest in contract compensation. This thesis launched the elaboration mainly from the three aspects mentioned above.The first part discusses the connation of reliance interests. In the civil law system, there are two main viewpoints on it, which are the "loss doctrine" represented by Professor Zejian WANG and the "interest doctrine" represented by Professor Jianyuan CUI. After comparing and researching the two doctrines, the academics further proposed the "inherent interest doctrine" and the "cost doctrine". The concept of reliance interest under common law system is relatively mature. It is widely held that reliance interests are one party’s "costs arising from the contract". The writer summarized the characteristics of reliance interests and form its own opinion, that is, reliance interests are the expenses, which arise from concluding and performing the contract to achieve the expectation interests under the contract.Based on the analysis of the relationship between reliance interests and contracting fault liability, the writer made two conclusions in Part II. First, the function of contracting fault liability is not limited to protect the parties’reliance interests. Second, reliance interests are not only remedied through contracting fault liability, but also by means of liability for breach. This thesis sums up the concepts of contracting fault liability in both legislation and theory and concludes that, the existing contracting fault liability does not necessarily require the close connection between loss compensation and the validity of the contract. Therefore, claims for personal injury and property damages arising from contract-making stage can also be supported by contracting fault liability. A logical corollary is that the function of contracting fault liability is not confined to the reliance interests in the negotiation phase. Then, the thesis lists some views on whether compensation claims for reliance interests are available under the liability for breach. Grounded on these views, the writer’s own opinions are proposed: the reliance interests also exist in contract-making stage. In the case of non-performance of a contract, the innocent party would incur damages of reliance interests and liability for breach arises accordingly.Part III focuses on the relationship between reliance interests, restitution interests and expectation interests. After analyzing the traditional and existing restitution interests under common law, the writer concludes that the traditional restitution interests are the exception to reliance interests and the existing restitution interests fall outside the scope of reliance interests. Then, the thesis mainly expounds the relationship between expectation interests and reliance interests. By comparing the concept of performance interests under common law and the concept of expectation interests under civil law, the writer believes that there is little difference between the two concepts. Therefore, illustrating the relationship between reliance interests and expectation interests is also useful and meaningful for China, although which is more like a civil law country. After that, the thesis makes analyses on the three circumstances, in which the compensation standards are almost the same offered by reliance interests and expectation interests according to Fuller. With such analyses, some concepts related to expectation interests are further clarified. Following that, the thesis makes comparison between expectation interests and reliance interests, illustrating that expectation interests not necessarily overweigh the reliance interests in many cases. Finally, this thesis raises and try to address the issue of overlaps in compensation for the damages of expectation interests and reliance interests.