The Right To Dissolve Executory Contract In Bankruptcy Law

An executory contract refers to a contract which has been entered into before the acceptance of a bankruptcy petition but is not yet been completely executed by both parties after the acceptance of a bankruptcy petition.The treatment and effect of executory contract will be directly linked to the insolvent property and the interests of the creditor.Article 18 of Law of the People’s Republic of China on Enterprise Bankruptcy regulating the bankruptcy administrator’s right to dissolving executory contract,however,the complexity and particularity of the executory contract cannot be reflected by only one rule.The vacancy of legislation directly leads to frequent problems in practice,so it is necessary to conduct an in-depth study on the performance of the executory contract.The first part of this paper introduces the definition and definition of the contract to be performed,and clarifies the object that the administrator can exercise the right of rescission.The second part is the concrete analysis of exercising the right of rescission.It discusses the exercising of the right of rescission from the following four aspects: whether to establish consent elements,exercising subject,exercising time limit and exercising mode.The third part is about the legal effect after the termination of the contract to be performed.It analyses the two viewpoints of "direct effect" and "compromise" about whether the contract to be performed has retroactive effect,and puts forward the viewpoint of adopting "compromise" that is,no retroactive effect after the termination of the contract.For the non-bankrupt counterpart of the contract,the right to claim damages arising therefrom can be declared as bankruptcy claims.In addition,if the administrator chooses to terminate the contract and both parties are willing to continue to perform,the part of the continued performance shall be valid,and the contract shall be deemed not to be terminated at this time.The fourth part is about the limitation of the right of rescission of the administrator.Combining with the most controversial cases of real estate lease contract and house sale contract in China’s judicial practice,the author puts forward the viewpoint of the legitimacy and necessity of restricting the right of rescission of the administrator.The fifth part is to improve the legislative proposals of the contract to be performed in China.