The Identification Of Unconscionability In Contract

Unconscionability,as a supplementary system for the principle of freedom,aims at pursuing fairness of the contract,which plays an important role in protecting the injured party.Before the establishment of The General Principles of Civil Law,The General Law and Contract Law,usually evade the elements of the unconscionable contract,especially in judicial practice,which leaves an equivocal answer.The ambiguous way to dealing with the element of the unconscionable contract leads to chaos,even generalization and abuse of the system in judicial practice.With the intensive academic study on the elements of unconscionable theory,there is a strong disputation about the element of unconscionable contract.Theorists who agree with“single element theory”argue that seriously imbalance of the benefit of two parties could be considered as unconscionability,and subjective elements are not required.However,although theorists supporting“the amended single element theory”think that subjective elements are not required in general,it is hard to deny that in some exceptional situation,unconscionable theory should be confirmed based on some subjective elements,for example,urgent,hasty,and inexperienced.Besides,there are also“the amended double elements theory”.On March 15^th,2017,The General Principles of Civil Law confirms that the unconscionable theory will adopt“double elements theory”.What's more,Article 151 not only clearly defines the subjective elements of unconscionability,but also taking advantage of others'precarious position is included in unconscionability,which returns to the original intention of the system.Thus,the discussion of unconscionability in legislation level comes to a conclusion.The General Principles of Civil Law have already defined the elements of unconscionability,so this thesis will not discuss it from the perspective of legislation.However,there is a lack of judicial interpretation and guiding cases concerning the affirmation of unconscionability,which deserves more investigation and research.For example,the definition of“significant imbalance in consideration”,the standards of existing law that can be adopted by identification of the“significance”of imbalance,and the definition of the state of distress and lack of judgement.Besides,the legislation takes an open attitude toward subjective elements,so what standards should the groundwork clause,“etc.”,reference?Referring to the previous research,some scholars point out that the identification of unconscionability tends to weakening the subjective elements.They also think that the sufficient element of one party could strengthen the weaker one.Therefore.“element-effect”mode should be abandoned,and the identification should adopt dynamic system theory which could be more flexible while identifying the subjective element.In order to solve the problems proposed before,based on adequate analysis and comparison of results and experience from foreign legislation and judicial practices,this thesis will raise some beneficial idea and suggestions,aiming at dealing with problems existing in the identified standards of unconscionability in China,from the perspective of recent law and regulation,judicial precedents and theories.Chapter 1 emphasizes the relationship between unconscionability and basic principles of civil law.As a supplementary system for the principle of freedom,unconscionability is qualified to change executed civil juristic act,which improves the importance of theoretical basis.Research on theoretical basis will avoid confusions of concepts,and it will provide guidance to its specific application.Chapter 2 emphasizes the objective elements of unconscionability.Firstly,this chapter presents an introduction of time nodes of constitution of unconscionability.The proposal that the time node of unconscionability is before its establishment not after differentiates unconscionability from the change of situation,and this chapter adopts judicial practices analyzing their difference.Secondly,the objective situation leading to unconscionability is significant imbalance in consideration.Significant imbalance is not equal to slight imbalance,and the confusion of the two concepts will lead to the abuse of unconscionability.Therefore,this thesis,based on foreign legislation and standards applied in judicial practices,will presents the standards worth referencing and explore suggestions that could be referenced in identifying unconscionability.Chapter 3 emphasizes the subjective elements of unconscionability.The General Principles of Civil Law indicates some subjective elements,for example,state of distress and lack of judgement,with“etc.”as its groundwork clause.Therefore,this clause adopts open enumeration.Based on Contract Law,The General Principles of Civil Law,The General Opinion of Civil Law,and relevant provisions of extraterritorial law,this thesis thinks that subjective elements,for example,“significant weakness of utilization of will power”and“utilizing dependency relationship”,should be affirmed.Besides,based on the analysis on the relationship between subjective elements and objective elements,this thesis disagree with applying dynamic system theory into the identification of unconscionability.