On The Application And Restriction Of The Right To Arbitrarily Cancel The Entrustment Contract

Article 410 of "Contract Law of The People's Republic of China" provides the Discretionary Right of Termination in the Commission Contract. It gives both parties the right to terminate the contract at anytime, anywhere, without any reason. The legitimacy of the right is that the parties in the contract have special trust. In the real economic activities, especially in the commercial commission contracts, the bond between the client and the trustee is not only trust. However,the current situation is that the relevant legal provision is too simple and there is no relevant legal interpretation. It also makes the right to have a negative impact. So it needs to be standardized some limits in the application.After studying a large number of cases, I find that there are some problems in the application of the discretionary right to terminate the contract. They are the differences between the discretionary right of termination and the general right of rescission, the applicable scope of discretionary right of rescission, compensation for damages after exercising the discretionary right and the effect of excluding the right of the rescission.The special right to terminate the contract is not the same as the general right of rescission. When in the judicial practice, the judge should respect the will of the parties at first. When the parties have no choice for which termination right to use,give the priority to the general statutory rescission right. It is also necessary to further explore the essence of the innominate contract if it has the similar innate characters of commission contract. If so, it can be applied to discretionary right of rescission.Otherwise, the right should be restricted in such contracts, which are mixed with other legal relationships.Based on the current legislative situation and judicial practice in our country, we should recognize the existence of discretionary right of termination in the commercial commission contracts and limit the abuse by the compensation for damages. The scope of compensation for damage after the exercise of the right of rescission is not uniform.in the gratuitous contracts, we shall limit the compensation in direct losses.But in the commercial commission contracts, it is necessary to analyze the nature of the contract and the behavior and performance of both parties in the contract, in some cases, the losses in the acquirable interests can be compensated. In principle, the effect of the abandonment of the discretionary right of termination in the commercial contracts is recognized, but in the contract based on the relationship of personal trust,the validity is denied.