The Effectiveness Of Offer When One Party Losing Disposing Capacity

The "Contract Law" does not prescribe on the effectiveness of the offer when the parties are dead or incapable. The effectiveness of the offer has an important impact on the establishment of the contract, so theory and legislation must respond to the validity of offer when the parties are dead or incapable. And this paper has a both theoretical and practical value. It can deepen theoretical study of the effectiveness of the offer, and help to provide a number of specific recommendations for revision and improvement the "Contract Law".This article will consist of the following four parts:The first part is to analyze and sort out the legal regulations and academic controversy on the effectiveness of the offer. By means of literal interpretation, systematic interpretation and purpose interpretation, we find out that the current legislation can not be apply to solve the effectiveness of offer when the parties are dead or incapable. Chinese scholars had a intense debate on the when the parties are dead or incapable. After analysis and carding, I found the following two main academic mainstream view: The first view is that death or incapacity of the parties is conditionally a cause of failure of offer; Another view think that incapacity or death of parties is always a cause of failure of offer. The article shows two main theoretical perspectives and their corresponding reasons.The second part is a comparative study on the effectiveness of the offer when the parties are dead or incapable. This section is to introduce the provision of civil law and common law. After the establishment of a general rule,civil law countries then provide a number of exceptions. These countries can be broadly divided into two categories: first, some countries like France, Italy and Spain choose the death of the rules offer when the parties are dead or incapable; second, some countries like Germany, Austria, Portugal, Japan, South Korea choose the existence of the rules offer when the parties are dead or incapable. For common law countries, the paper introduces the origin of death of the rules in case law in the United States, the provisions of the United States contract law,the rules restatement of English contract law and related aspects.The third part is a comprehensive analysis of domestic and foreign relevant provisions. Based on the previous two parts and after further analysis and summary of foreign regulations, the paper concluded that the Offer is generally ineffective when the parties are dead or incapable. From the encouragement transaction, countries do not follow the common sense and they make a series of breakthrough on provisions instead. These provisions are not all the same, a several major standard which is a cause of failure of offer are established: "the performance of the contract of personal nature " standard, " the offer containing other meaning or expression of opposition meaning" standard, "offer defining the term” standard,"the offeree knows death or incapacity of offeror "standard," death of offeree before making a commitment "criteria.The fourth part is additional legislative proposals for corresponding regulations of China's "Contract Law".To make some improvement of legislation, provide clear guidelines for the administration of justice and to avoid unnecessary litigation,it is necessary to adopt legislation on effectiveness of the offer when the parties are dead or incapable. Drawing on experience from comparative law, taking Chinese national conditions and equal consultations of the parties at the time of conclusion of the contract into consideration, and promoting the optimal allocation of social resources, it is better to choose the existence of the rule of offer as a general rule when the parties are dead or incapable. For specific requirements, it is recommended to increase second paragraph in the "Contract Law" Article 20:subsequent death or incapacity of offeror or offeree does not affect the validity of the offer, except in the following circumstances:(1) the contract has personal fulfillment nature;(2) the opposite party have different meanings may be inferred from words or behavior;(3) offer is issued to a specific person,but offeror is dead before offer is committed by offeree. In order to stabilize the legal relationship as soon as possible and to restore the legal relationship to the norm, notice is of great importance. Notify is an effective way to solve unexpected problems in the the process of reaching a contract. As it relates to the performance of contract and the cost of preparation, based on the principle of good faith, the relevant parties should bear the obligation to notify. For specific requirements, it is recommended increase third paragraph in Article 20 in the "Contract Law" : as offeror or offeree is dead or incapable in the process of contracting, the respective parties shall be promptly make the obligation to notify; he or she should bear the liability if not fulfilling obligation.