Research On The Punitive Liquidated Damages System

Punitive damages system has been the emphasis and difficulty in civil law theory and practice in our country.For the status,judging standard and application of punitive liquidated damages,the provisions of the contract law is not made clear.Although academic theory related is various,there still lack a clear and unified understanding,which lead to problems of different criteria in the judicial practice.This paper aimed to the legitimacy of punitive penalty due to breach of contract,and then clarifies standard of punitive liquidated damages,finally puts forward a set of unique rules of adaption for punitive liquidated damages.The content of the paper mainly expounds the following three parts:The first part demonstrates the necessity of the punitive liquidated damages.This part firstly makes an analysis to our country "contract law" the 114 th.It is concluded that China's contract law primarily provide a compensation for breach of contract,but also allows penalty due to breach of contract on its own agreed by the parties based on the principle of party autonomy.In addition,the court recognized the existence of punitive liquidated damages in the judicial practice.And then analyzes the major national and regional legislative cases and theories.The mainland legal system country and Taiwan area of our country admit the existence of punitive damages.Although Anglo-American law system countries deny punitive penalty due to breach of contract,they set up a clear definition between penalty due to breach of contract and compensation for the breach of contract.Then the part refute negative view on the rationality of punitive liquidated damages,and demonstrate that punitive penalty due to breach of contract in our country has its existence value: It protect the party autonomy,actualize the function of guarantee the performance of penalty due to breach of contract,and ensure integrity and fair trading.The second part analysis identified standard of punitive penalty due to breach of contract.The main theory of identified standard in academic circles in our country at present are parallel responsibility,amount to compare,subjective purpose and pre-set damage.Among them,the amount to compare look the actual loss as the judgment standard,so damage the possibility of the parties based on the autonomy of liquidated damages.It is unscientific,as well.The subjective purpose and pre-set damage is hard to apply in practice.Being compared,the parallel responsibility said more reasonable.It can clearly define the punitive penalty due to breach of contract and compensation for breach of contract,but there is still a problem of undistributed.In judicial practice,the courts define different criteria of punitive penalty due to breach of contract and the amount to compare occupies the dominant position relatively.Identifying punitive penalty due to breach of contract should build on real meaning of the parties when they sign a contract.When the real meaning of the parties is not clear,the court should analysis the objective aspects of the contract,combine the standard of parallel responsibility with the standard of revised amount,and finally make the judgment.The third part studies the application of punitive liquidated damages.This part firstly analyzes the premise of the application of punitive liquidated damages.There shall be established and effective contract,breach of contract and the fault of default party.Actual damage is not necessary.Then the paper discusses the relationship between punitive penalty due to breach of contract and other forms of liability for breach of contract.Performance,damage compensation and punitive damages can be applied together,but the way of application varies due to the default form.Based on the rules of "the punishment no longer",punitive damages cannot coexist with the punitive part of deposit of default,but can coexist with the part to fill the damage of deposit of default.There not have application problems in the relationship of punitive liquidated damages with the rest of the deposit.Finally,paper studied the reduction problem of punitive damages.It is suggested that the maximum of punitive liquidated damages provisions should be limited in thirty percent of the total amount of the underlying contract,but the court still have to consider the degree of fault of contracting status of party,the breaching party,the extent of obligations and economic conditions and other elements,to make the decision of reduction scientifically.