Legal Issues Of The Liquidated Damages Calculated By The Day

The essay focuses on the hot legal issues relating to the liquidated damages calculated by the day. Although 114 th article The Contract Law of PRC regulates the issue of liquidated damages, its content is too general to cognitive and applies in the legal practice. Besides the agreement on damages varies, especially on the circumstance of delayed performance, liquidated damages are commonly calculated by the day. The more performance delays, the more liquidated damages will produce more. There is a big difference between this way and fixed liquidated damages. In order to appropriately apply the liquidated damages calculated by the day in practice, we need to figure out its characteristics and examine its application.Except the introduction and summary, the other three will be written deeper than deeper in logic.The first part is mainly on the characteristics of liquidated damages. The application of a system is closely related to its characteristics. There are controversies on the liquidated damages. The first is whether liquidated damages are also a way of warranty. The second is whether liquidated damages are punitive or compensatory. From the observation on foreign law and the clear-up of opinions of academic circle, the author figures out that liquidated damage is a civil liability not a warranty. Meanwhile it commonly compensatory, but sometimes punitive. The liquidated damages come from the agreement of the contracting parties. It has two obvious characteristics. One is that the obligation is durable; the other is that liquidated damages are closely related to the delayed performance.The second part is about the statute of limitations. Because the amount of the damage cannot be predicted at the time of contracting, even of the breaching, and the current legislation dose not regulate it directly, so the application differs. The author argues that the liquidated damage is a continual debt but is different from the rent fulfilled at fixed period. Based on the theory of continual debt and statute of limitations, we argue that liquidated damages are a debt whose deadline for performance is unfixed, and then to decide the beginning of the limitation according to 6th in <About the Rules of the Provisions of the Applicable of Limitations in the Trail of Civil Cases>.The third part focuses on the judicial adjustment on the liquidated damages. Because the damages are compensatory, the day-to-day calculation will led to a large mount of damages, so the judge need to consider whether it is necessary to adjust it by court. From the value of judicial adjustment and its rules, the author argues that the adjustment depends on two situations. If the large amount of damages is caused by the long duration, it is not appropriate to adjust. If the excessive damages are caused by the criterion of calculation, then it is appropriate to adjust it. At the same time, in order to quantify the day standard of the liquidated damages, the delay in performance of the debt can be divided into monetary obligation or not. For the former, we should also consider the possible impact of the legal interest rate limit, so the day calculation standard should not exceed 0.67‰. As for the later, we should consider the specific situation of the loss. At last the essay brings some suggestions on the rules of judicial adjustment.