Limitations Of Damages For Breach Of Contract In European Contract Law

In every legal system, the question arises out of the consequences which a party of a contract has to bear in the event of breach of that contract. The possibilities for the innocent party to obtain legal protection are generally manifold, whereas a claim for damages is a fundamental and effective option. This makes the question of law a core component of each legal system within European and worldwide. Most of the time, the loss derived from the breach of contract is not a fixed value, but a variable quantity. If all the loss of the creditor after breach of contract can be compensated, it would turn out to overburden the debtor, and at the same time, it is harmful to the development of commercial activities. As a result, it is vital to have some rules to limit the coverage of damages, and to sort out which losses can be compensated by a claim for damages and which loss do not result in such compensation, and thereby avoid extensive liability of the contract breaker. In the major legal system all around the world, there are four central limitations of the coverage of damages for breach of contract: foreseeability, causation, contributory negligence and mitigation of loss. What's more, all of those aforementioned rules are originated and perfected in several European countries. In order to reorganize a set of clear and operating easily rule system concerning limitation of damages for breach of contract, this study would based on analyzing the most important outcome of the work on the unification of law in Europe—Draft Common Frame of Reference(DCFR). At the same time, it would compare the limitation of damages in different European countries, especially analyzing the German law and Scots law, because the comparison of these two legal systems is not least of interest for a possible unification of law in Europe.This dissertation divided into five parts.The first part summarizes the limiting rule system of damages for breach of contract in European contract law. It mainly introduces the limitation theory in different European countries. In the end, this part points out problems of the limiting system of damages in China after rule transplantation.The second part is the foreseeability. It elaborates the development process of foreseeability in the unification of European contract law and the unification of international private law. Besides, this part is based on the foreseeability rule in the Scots law. Through a set of precedent, it reveals the perfecting course of the rule in England, and summarizes the essential requirements of foreseeability. What's more, it introduces the new rule which is supposed to challenge the position of foreseeability. In the end, it comes up with some suggestions for the current legislative situation of this issue in China.The third part is the causation. This part divides causation into factual causation and causation in law, and expounds their application in different European countries. What's more, there are four rules which could confirm the causation in law between loss and breach of contract in England and German. This part would classify the four rules through objective and subjective approach, and analyze the essence of those rules. Finally, it introduces how legislators who work on the unification of European contract law make a choice between different limiting theories of damages for breach of contract.The fourth part is contributory negligence. This part elaborates the regulation concerning contributory negligence in different legal documents which derived from the unification of European contract law or international private law. What's more, this part explains the innovation made by European legislator on this issue, and the relationship between contributory negligence and the principle of strict liability. In the end, this part summarizes various disputes regarding the contributory negligence in China and the inspiration that we can seek from the unification of European contract law.The fifth part is the mitigation of loss. First of all, this part enumerates the regulation concerning mitigation of loss in different legal documents which stem from the unification of European contract law. Next, it introduces the European legislator's summary of reasonable criteria for the measure of mitigation. It also elaborates European legislator's choice and innovation on the issue of the relationship between mitigation of loss and loss attributable to creditor. Finally, it puts forward some suggestions for the mitigation of loss in Chinese contract law.