A Study On The Practical Problems Concerned With Dissolution Of Contract

Once a contract established, both parties should fully perform their respective obligations in accordance with the contract. But, there might be no way to fulfill or achieve the expected benefits of the contract due to some special situations occurred in the performing process of it. In order to free from the rigid contracts that bound the parties, it is necessary to break the method lock of the contracts. This is the original reason to set up the system of termination of the contract. Our current legislations on the exertion conditions, the exercise and legal effect of termination of the contract right are so principle and general that the applications of law in the judicial practice are lack of a clear, unified standard of referee. The author mainly analyzed the exertion conditions, the exertion way and the legal effects of contract cancellation right during the temination of contracts, from the perspective of law issues, by citing cases which the author judged or read before.There are four parts in this thesis. The first part is the summary of the system of termination of a contract. The framework of current legislation has three relieving types: dissolution by agreement, dissolution by appointment and statutory dissolution. If the parties agreed the termination of the contract, the contract shall be terminated even if there is a special agreement. The termination of the contract and the statutory dissolution of the contract are both unilateral termination, but the requirement of terminating the agreement or the statutory conditions must be met, and the right to terminating the contract shall be entitled performed by the party which has termination right according to certain procedures and manners. Dissolution of the contract has double characters: one is the right of action of simple formation, the other is the right of action of formation. Which kind type of the cases belonging to is dependent on the specific procedures of the dissolution of the contract. In principle, breaching party has no right to relieving the contract, and only the non-breaching party can do this. However, due to force majeur caused the dissolution of the contract, both parties have the rights to relieving the contract. Also, if both parties have the breaching behaviors, the slight breaching party may terminate the contract.The second part is about entitling the important document of the termination right of a contract. The agreed termination conditions are reached by the parties in advance, but those often needs to explain the cancellation clause. The agreement on the clause which shall not be terminated means that neither of the parties shall unilaterally terminate the contract unless terminating it by agreement. The parties are still holding the right of the legal termination, and should not be regarded as giving the legal right up in advance. The applicable termination clauses in format contract must also follow the relevant provisions of the format terms. The statutory termination conditions are defined by law, but in the judicial practice examination, it is still a complex and difficult task to examine whether they conform to the legal conditions. We should examine whether it conforms to the agreed termination conditions first, and then examine whether it conforms to the statutory conditions.The third part is in regarding to entitling the termination right of a contract. China’s Contract Law has clearly stipulated the termination mode and made the objection provision flexibly. Meanwhile, the judicial interpretation has definitely the position of the judge termination mode and, in the judicial practice, the judge termination mode has been accepted generally. On one hand. it is based on the needs of realities; on the other hand, it is confined to the legal cognition standard of the broad masses of the people. Simultaneously, as the period time of entitling the termination right of contract belongs to the scheduled period, the right is abolished when time is overdue.The fourth part is about the legal effect of the termination right of a contract. China’s Contract Law has taken the provisions flexibly but the specific cases should be specifically analyzed. The claim of restitution is the typical form of rehabilitation, and the nature is claimed as the ownership returning petition right. In principle, once the ownership of subject matter transformed, the return of the original items will not bear any legal responsibilities except for the special provisions of law or the parties reached on special agreements. After the termination of the contract, the parties also have the rights to requiring for the compensation for losses within the scope of profits.