The Legal Problem Of Right Of Stoppage Within Contract Of Carriage

Right of stoppage in transit is when Buyers go bankrupt, the unpaid Sellers without the possession of the goods could enjoy the right of stopping delivery during transport period. The stoppage right, considered as the way of pursuing substantive justice, originated from the British business practices of 18 th century, which was the right of remedy to ensure Sellers to be paid by suspension of the contract performance. China has the stoppage right, which is specified in the “Contract of Carriage” section of “Contract Law” and “Maritime Law”. But due to the simple, rough and lack of operability legislation, there are some problems about exercising the stoppage right in judicial practice. Therefore, given the legal problems of the stoppage right within contract of carriage, this paper tries to clarify the confusing legal concepts in order to contribute the Chinese transportation act.The paper is divided into three parts, namely preamble, main body and conclusion. The preamble part, discusses about the raise of question, the value of paper, thesis structure, research methods and literature review, which shows the purpose of writing and research value and also plays the outlining role of the paper. “The raise of question” section holds the opinion that the stoppage right does not reduce its function due to credit transactions and still be able to protect owners’ property rights. Chinese rules of the stoppage right are bit of messy and fragmented. Therefore, the problems mentioned above determined the discussion of whole paper. “Research value” section mentions the theoretical and practical significance. The author mainly uses empirical research, historical research and comparative studies. In addition, the preamble part also talked about literature review.The main body part, fully demonstrates the legal problem of the stoppage transit according to the issue raised, which is consisted by four parts, with the mean line as “the raise of issue – the reason of question – the solution of the question”, making the discussion step by step.Chapter One: “Status Analysis of Chinese Stoppage Right”, is divided into two sections. Firstly, the author analyzes the law content of the stoppage right in detail, from the "Contract Law" Article 308, "Maritime Law" Section 89 to “CISG” Article 71. Through this part, comparative methods are widely used to highlight the problems of transport legal system and the direction of improvement. Secondly, the writer mainly discusses the status quo of judicial problem under the stoppage right with the methods of empirical analysis, case studies and comparative analysis. With citing several cases of recent maritime disputes, the paper reveals the current situation vividly, such as the absence of engagement between “Contract Law” and “Maritime Law”, the application argument of the stoppage right and the carriers’ difficult choices when executing instructions.Chapter Two: “Reason Analysis of Existing Legal Problem under the Stoppage Right”, is divided into three parts. The first section deliberates the origin of the stoppage right, which was ruled by British merchant customary law as business rules and practice, and later be adopted by other common law and civil law countries gradually. The essence of stoppage right was derived from the suspension performance of the contract in order to protect the security of transaction. Under continental law system, the stoppage right belongs to the permanent counter argument right raised by Sellers to Buyers. The second section followed enlightenment to China focuses on the stoppage right under the common law system. Through the British and American legal framework under the stoppage right, this party demonstrates the original of system, which has a clear description of oblige and principal, the exercise of rights, informative content rights and be stipulated under the trading law. Therefore, the paper discusses the distinction belong the different countries and fins the reason under China transportation legal problem. The third section is researched by the Germany legal system of the right stoppage and comes up with the idea about dual mode transportation law, which is a reference to China to solve the relevant legal problem. What’s more, the author raises the concept of right of control in order to distinct with the stoppage right and the way to enjoy the right.Chapter Three: “the Dilemma Breakthrough of the Stoppage Right”, is divided into two aspects, which is tightly related to contents above and holds the opinion that we could draw right of control into existing Chinese transportation law. First, combined with the discussion of the value under the right of control, the author considers that the right of control could distinguish the function of contract law and transportation law, clear controlling party and right content, conform to the transport needs of the new century and the promotion of free transport documents and e-commerce mode. Second, the legislative structure of right of under the Rotterdam Rules is discussed in detail in order to make reference to Chinese legal system.Chapter Four: “the Way of the Right of Stoppage under Transport Legal Relationship”, is divided into two parts. The first section explores the feasibility of dual right of stoppage and right of control, which is discussed by conception of legal system, problem breakthrough and reference of right of control. The author compares the difference between the current system and basic system through the establishment of the legal model approach. The paper holds the view that the current Chinese transportation legal system needs both the stoppage right and right of control, which could be effectively combined with the international sale of goods, provide the sellers right of remedy and resolve the transport judicial disputes, be adapted to payment environment of the 21 st century. Finally, combined with the writer’s thinking about transportation legal issues, the paper explores a sound legal system in order to solve the legal problem of the stoppage right. The author makes a point that the right of stoppage could be completed under “Contract Law” and right of control could be added under “Maritime Law”.Conclusion part, reviews the full text and restates the viewpoint plainly and clearly. The author restates that contract law and transportation law are different issues, while the Chinese transport law mixes these two questions and results in judicial practice applicable in chaos and embarrassment. We need to clear that the stoppage right and how to exercise the right are two concepts. The right of control under the Rotterdam Rules regulates effectively how to exercise the right. The author considers that we could improve the relevant provisions of the “Contract Law” and “Maritime Law”, moving the stoppage right from “transportation contract law” to “sales contract law” and referring to the Rotterdam Rules in order to increase the right of control.