A Study On The Validity Of Civil Contracts That Violate Mandatory Administrative Provisions

In regard to the issue of determining the validity of civil contracts that violate mandatory administrative provisions,there is currently a cacophony of opinions in the academic community and a unified view has not yet formed.In practice,there is no unified judicial yardstick and even the same court may hand down conflicting rulings on similar cases.Overall,the approaches to determination proposed in the academic and professional circles are all limited to some extent.In judicial practice,the prevailing view is that the validity of civil contracts should be determined according to the rank of mandatory administrative provisions as provided for in Article 52(5)of the Contract Law.Such an approach to determination which pivots around a legal hierarchy obliterates the legal meaning of mandatory administrative provisions.The judicial interpretation of the Supreme People's Court divides mandatory provisions into mandatory provisions on validity and mandatory provisions with an administrative aim,asserting that a contract should be invalid if its content violates any mandatory provision on validity and should be handled with care if its content violates any mandatory provision with an administrative aim.Chinese law offers no clear and specific provisions on the content of and criteria for differentiating these two types of mandatory provisions.Generalization poses many difficulties to judicial practice,leading to frequent suspicions that judges engage in circular reasoning when presiding over trials.Such a method of work based on the classification of mandatory provisions cannot be overestimated in terms of guiding judicial judgments.It is noteworthy that,from the point of view of Article 52(4)of the Contract Law,the approach to determination suggesting that a contract should be invalid if the contract action harms the public interest is reasonable to some extent.But a clear legal analysis framework has not yet formed regarding how to determine whether the public interest is damaged.To effectively solve the issues surrounding the validity of contracts that violate mandatory administrative provisions,we shall go straight to the method for determination which is based on the weighing of interests and abandon mandatory provisions on validity and mandatory provisions with an administrative aim.Interests should be carefully weighed strictly in accordance with the principle of proportionality and by the successive application of the principle of appropriateness,the principle of necessity and the principle of balance.