On The Purpose Of The Contract

From the view of the current Chinese Contract Law,the purpose of contract has not yet attracted sufficient attention of legislators.Neglected by legislature and theoretical research,the identification of the purpose of contract was in a mess in judicial practice.This paper commits itself to the research of the purpose of contract,which involve connotations and the characteristics of the purpose of contract,the functions and the ascertainment of the purpose of contract,the identification of the frustration of purpose of the contract,etc.Through analysis of the problems in current legislation and judicial practice,we can draw a conclusion that it is necessary to institutionalize the purpose of contract,which demand that the legislature,the judicial authority and the parties assume their respective roles and work together to fulfill their responsibilities to achieve ideal results.The paper divides into five parts:The first section:this part sets its sights on overview of the basic theory.Through weighing the pros and cons of the interest theory and the theory of norms,we can summarize that the purpose of contract aims at achieving the change of interest.The interests not only involve economic interests but also include spiritual interests.The purpose of contract can determine the validity of the contract,ascertain collateral obligation of the contract and optimize specific terms of the contract.Also it can prevent the abuse of unilateral contract cancellation right,which makes it a decisive role.In general,the purpose of contract is unilateral,but it is mutual in the partnership agreement and co-development contract.The second section:this part begins with the so-called "the purpose of contract in law",which comes from a verdict.With that,doctrine of causes in French law and the distinction between basic purpose and further purpose in German law are introduced.Through contrasting with those concepts,we can find out that the purpose of contract in law is actually the proximate cause in French law and the basic purpose in German law,which means the paying obligations that the parties seek.And we just call it objective purpose.The purpose of typical transaction,put forward by Professor Cui Jian-yuan,is in accordance with the connotation of objective purpose and is worth learning.The purpose of typical transaction can be considered in abstract perspective and in concrete perspective.Neither should be overemphasized at the expense of the other when recognizing objective purpose of contract.But the purpose of typical transaction can not meet all of the needs of the parties.To make up for this flaw,we can regard the motivation as the purpose of contract in a particular situation.The third section:the ascertainment of the purpose of contract can be discussed in two perspectives:extent and method.The basic degree is started with exploring the basic attribute of the subject matter of the contract.The further level is rooted in the special needs from the parties.There are varieties of ways to ascertain the purpose of contract:going through the text of the contract,investigating information come-and-go between the main parties to the contract,taking trading custom and industry practice at the time into consideration and deducing according to the criterion of a rational man.We should combine both ways when confronted with complex cases.The fourth section:to figure out the relation between frustration of purpose of contract and fundamental breach of contract.Through the comparison of Anglo-American law,German law,CISG and Chinese Contract Law,the way of Chinese Contract Law to judge fundamental breach of contract,which consider the seriousness of the consequence arouse from breach of contract apart from subjective fault of the defaulting party,is thought to be better for protecting non-breaching party.Action is to outcome what fundamental breach of contract is to frustration of purpose of contract.Breach of contract like delay in performance,refusal to perform,improper performance and partial performance become fundamental breach of contract,as soon as they give rise to frustration of purpose of contract.Attention to detail is vital in the job of ascertaining whether breach of contract leads to frustration of purpose of contract.The fifth section:some advices about institutionalizing the purpose of contract based on the problems mentioned above.The purpose of contract should be embodied in Article 12 of Contract Law as general provision.Judicial interpretation of Supreme Court should be issued to solve the depute about the clause of the purpose of contract.The parties should response positively to stipulate the purpose of contract individually and specifically.