On The Exercise Rules Of The Bankruptcy Administrator’s Option

The China Bankruptcy Law grants the bankruptcy administrator the option to decide whether to terminate or continuously fulfill the uncompleted rights of both parties conferred by contract.The exercise of the option involves a wide range of stakeholders,including the interests of the counterparty,the value of the debtor’s property,and the realization of the general creditor’s interests.However,the lack of provisions of executory contract in the field of bankruptcy law and specific legislative guidelines in bankruptcy procedures will result in inconvenience in the exercise of administrator’s option.Therefore,the author wants to discuss the exercise rules of the administrator’s option.The first part of this article mainly discusses the application scope of the administrator’s option.This article points out that the application scope of the option is the double service contract that is not fully fulfilled by the debtor and the counterparty through introducing of the provisions of the bankruptcy law of China and overseas.And this article also concluded that “not completed” refers to the main payment obligation and conventional payment obligation through analyzing the doctrines and practice judges.The second part introduces the principle and duration of the exercise of the administrator’s option.Firstly introduces principles to the exercise of options.And this article discusses the exercising duration in the bankruptcy laws of various countries.It focuses on the suggestion that administrator’s option cannot be exercised in the bankrupt practice due to the fact that the court did not designate the administrator within the time limit.The third part focuses on the consequences of the exercise of the administrator’s option.Firstly discusses the case that,when the administrator chooses to perform the contracts,the counterparty’s right of security request,unsafe defense,and the right to cancel the contract.And get the conclusion about the nature of claims arising from contract performance by case analyzing and concluding the existing doctrines.Secondly,the legal effect when the administrator’s decision to terminate the contract is clarified and the scope of the counterparty’s claim for compensation for damages is defined,and the treatment of the breach of contract and the deposit as stipulated in the performance contract is discussed.The fourth part of this article specifically analyzes the ownership retention contract,real estate lease contracts,intellectual property licensing contracts,and home purchase contractssigned with real estate companies,which are common in practice.Beside,whether the exercise of the administrator’s options should be restricted and what restrictions should be imposed in several specific cases will also be discussed.