The Legal Application And Proof Of Trade Practice

Trade practice is a kind of trade behavior which is derived from social practice and applied repeatedly in the long-term,with a standardized meaning.According to ‘Trade Practice' in the Article 7 of Supreme People's Court Interpretation on Certain Questions Concerning the Application of the Contract Law of the People's Republic of China(?),the particularity of trade practice is embodied in the nature of its regional,territorial,industry or mostly unwritten trade behavior which is limited to the repeated trade behavior among the transaction subject.The repeated trade behavior is flexible and also a kind of challenge to the legal certainty.The cognitive of trade practice is a prerequisite that it is the subjective element which is applied to trade practice reasonably,and the application of trade practice must has a necessary condition that the transaction subject must agree with or approve to the application of trade practice.At the same time trade practice has the characteristics of temporality and legality.Except the agreement of changing,it is reasonable that the time of the conclusion of the contract is the time node that the transaction subject apply to trade practice.Trade practice is a way to explain the contract and fill gaps in contract.It is not only to meet their own interests of the parties,but also to respect for party autonomy in the principle of encouraging the transaction.It's also an effective means that the judge can use it to protect the security of transaction and to encourage transactions.Except the supplementary agreement,this approach,which is closer to the true meaning of the transaction subject,can save the cost in advance,improve the efficiency of the transaction and the trial,and also have the function of overcoming the rigid positive law.But it must pay attention to avoid the error of parties' consensus in the transaction process.Due to the characteristics of trade practice,the status of the legal application is not optimistic.There are practical problems such as the court avoiding the application of trade practice,non-standard argumentation and how to prove trade practice and its criteria.There are some reasons under these problems,such as undefined concept,the particularity of trade practice,the limitations of the judges' own knowledge or the low cost of opportunism.In the final analysis,the most important reason is that trade practice is different from the positive law so that it causes the non-standard application.Therefore,who apply to trade practice should understand the characteristics of commercial transactions,follow the orderliness of commercial transactions,use cost-benefit analysis methods and use commercial thoughts through the application of trade practice.It is practicable to construct a kind of risk-control framework in terms of the difficulty of forming a written text which influences legal certainty.Both transaction subject and the judges can predict the risk through rules within the framework,assess whether the application of trade practice is consistent with maximizing the benefits of commercial transactions and minimizing the cost or not,and make the balance between legal certainty and flexibility.At the same time,based on the reduction of negotiation costs in advance and the reduction of risk and the potential dispute costs,the law can or should try to establish a kind of case guidance system about trade practice to regulate the transaction.The application of trade practice should be based on the premise that some clauses of contracts are unknown or the parties have ambiguities in the interpretation of the terms and cannot reach a supplementary agreement.To prove the objective elements of trade practice,such as ‘usually use',‘often use',and subjective elements,such as ‘know or should know trade practice when the contract is made' is a problem in the application of justice.Through the empirical analysis of existing cases,the transaction subject can provide written trade practice,the testimony of multiparty witnesses,specific activities and the transaction process to prove the existence and substance of trade practice.There are some other methods to prove ‘usually use',‘often use',‘know or should know trade practice when the contract is made',such as expert testimony or the judges obtaining evidences.But it can not be ignored that the judges may misunderstand the application of trade practice because of the limitation of useful information about trade practice.So it maybe another question to further study the problem of knowing information about trade practice.