Research On The Dismissal System Of The Defaulting Party

As a special reason for the termination of contract rights and obligations,the contract termination system has been strictly controlled in terms of legislation and application.And statutory termination is more widely regarded as a right that should only be enjoyed by non-defaulting parties.The "Xinyu case",which was selected as one of the bulletin cases by the Supreme People's Court in 2006,is a case in which the breaching party sued for the termination of the contract.In this case,the court supported the breaching party's request and terminated the contract.The "Xinyu case" aroused discussion in the academic circles about the termination of contract requested by the breaching party,in the meantime,there have been more and more cases in which the breaching party requested the termination of the contract in judicial practice.However,on this issue,the academic circles have different opinions,and there is no uniform judgment standard in practice.At the time of the compilation of the Civil Code of the People's Republic of China,the discussions on the right of termination by the breaching parties reached unprecedented heat.This article,from the perspective of empirical analysis,collated and analyzed the judgment opinions and quotations of the litigation in the cases which breaching party requesting the termination of the contract.From the statistical results of the cases,89% of the courts believe that the breaching party can be supported to terminate the contract under certain circumstances,and the main basis is Articles 94 and 110 of the Contract Law.The main differences between them and the courts that do not support the request of the breaching party are: First,the right provided in Article 94 of the Contract Law belongs only to the observing party or belongs to both parties.Second,whether allowing the breaching party to terminate the contract violates the principle of good faith.Third,whether the law does not prohibit the freedom or the law does not authorize it to do nothing.Fourth,the judgment supporting breaching party's termination of the contract is positive or negative to the whole society.It is true that the right of termination of the breaching party cannot be applied as a general rule.But with its application and constituent elements being limited,allowing the breaching party to terminate the contract will not shake the foundation of the principle of good faith and is in line with intrinsic values of the law such as freedom,security,order,efficiency,and fairness.In addition,since the existing law system does not have a clear regulation for the breaching party to terminate the contract,the court reasonably invoked Articles 94 and 110 of the Contract Law.However,it is obviously inappropriate to use Article 94 as a source of right of the breaching party,and Article 110,as a defense rule for the continued performance of the contract,cannot effectively resolve the contract deadlock.The lack of legislation will not only lead to the lack of persuasiveness and persuasiveness of judicial decisions,but also induce the breaching party to terminate the contract opportunistically.Therefore,it is reasonable and necessary to raise the right of termination of the breaching party to legislation.Paragraph 3 of Article 353 of the Civil Code Contract(draft)(the second draft)has placed reasonable restrictions on the constituent elements of the breaching party's right to rescind the contract,set it as a right of action,and clearly stipulated the liability.It is expected that this article full of practical guidance significance will receive good social effects,and the deletion of this provision in the newly published Civil Code of the People's Republic of China(Draft)will make the difficult problem of judicial practice hard to solve.Considering there are already a large number of cases that allow the breaching party to terminate the contract,legislation should respond with clear legal provisions to regulate the behavior of civil subjects and guide judicial trial practice.Therefore,the legislation on the right of termination of the breaching party should be restored and supporting laws,such as the rules for litigation costs and the calculation of liability for breach of contract,should be improved to suit the consequence of the contract being terminated by the breaching party.