A Study On The Nature Of The Debt Settlement Contract After The Performance Period

A debt settlement agreement refers to a contract entered into by both parties to substitute other kinds of payments for the original payment.The Contract Law of the People’s Republic of China(hereinafter referred to as the "Contract Law")does not provide for a debt settlement agreement.Whether the performance period of the creditor’s right has expired has an important influence on the determination of the legal nature of the contract.The debt settlement contract reached before the expiry of the creditor’s right may be invalidated because of its violation of Article 186 of the People’s Republic of China’s Property Rights Law(hereinafter referred to as the "Law on Property Rights").As for the debt settlement contract in which the period of the creditor’s rights has expired,the characteristics of this type of contract are: First,the establishment of this type of contract is based on the legality and validity of the original debt and debt.Second,the debt delivered by the debtor shall be different with the original debt.Third,it is necessary for the creditor and the debtor to form an agreement.At present,the theory of datio in solutum,the theory of datio in solutum appointment and the theory of disposition action are the three main theories regarding the nature of the debt settlement contract in respect of which the period of the creditor’s right has expired.And the theory of datio in solutum is the universal theory the theory of datio in solutum defines the debt settlement contract in which the creditor’s right has expired as a principal contract.The theory of datio in solutum appointment is an attempt to amend the drawbacks of datio in solutum through the theory of the appointment contract,so as to make the agreement between the creditor and the debtor as an appointment.The theory of disposition action is based on the theory of real right behavior,and it identifies the contract of debt settlement contract as a real right contract.The above three theories have drawbacks in defining the legal nature of the debt settlement contract which the period of the creditor’s right has expired.The theory of datio in solutum confuses the legal connotation of the delivery of the subject matter and the performance of the contract.The application of this theory not only lacks a legal basis,but also has no conducive to the realization of the purpose of the contract.Meanwhile,it cannot protect the interests of the creditor and the debtor.Finally,the application of this theory is not conducive to the prevention of false lawsuits.As for the theory of datio in solutum,this theory is purely for the purpose of resolving the drawbacks of the theory of datio in solutum,which defines the debt settlement contract of which the creditor’s right has expired as a practical contract.Because of its insuperable contradiction in logic,this theory should be discarded.In terms of the the theory of disposition action,on the one hand,our country does not recognize the real right behavior theory;on the other hand,the performance of the debt settlement contract of which the creditor’s right has expired should be considered as a factual act.Therefore,it is not feasible to apply this theory to define the debt settlement contract as a disposition action.In determining the legal nature of a debt settlement contract in which the creditor’s right has expired,the independence of the contract should firstly be recognized.On this basis,the debt settlement contract is a new debt repayment constract.Unless both parties clearly agree that the establishment of the debt settlement contract will lead to the elimination of the original debt,it should be recognized that the debt settlement contract coexists with the original debt.Secondly,based on the growing trend of the principle of freedom of contract as well as the promise of contract,the debt settlement contract of which the creditor’s right has expired is not a practical contract but a promise contract.Thirdly,the creditor can only require the debtor to perform the debt settlement contract first,while for the debtor,it can allow him to go back on his word and choose to perform the original debt...