The Applicable Conditions And Legal Effects Of "Excessive Cost Of Performance "

"Excessive cost of performance" is stipulated in the item 2 of the proviso of Article 110 of the Contract Law of China,as one of the exclusionary rules for the claim for actual performance.In the case of non-monetary debts,if the creditor requests to continue to perform the contract,the debtor may exclude the original payment obligation by claiming that the performance costs are too unreasonable.In judicial practice,when the debtor has serious payment difficulties and the performance of the contract tends to be inefficient and meaningless,the "excessive cost of performance" plays an important normative role in the settlement of such contract disputes.However,the legislation concept of "excessive cost of performance" is too broad,and there are multiple understandings and differences in the theoretical field on the discussion and interpretation of "excessive cost of performance".Due due to the lack of a unified understanding of the system description,defining standard and legal effect of this article,thus causing confusion in practical application.In the typology study of the gazette cases of the Supreme People's Court and a large number of other cases,it can be observed that there are specific difficulties and disputes in the application in China's practice.For example,vague understanding of the composition of performance costs and inconsistent judgment of the reference object with excessive performance costs often lead to unclear interpretation of legal effects and confusion ofapplication with the change of circumstances.As one of the cases of insufficient prestation,"excessive cost of performance" is different from the factual or legal impossibility.Instead of these two obvious cases,the application of "excessive performance cost" must be explained through interpretation and to determine the scope of the costs,the reference object as well as the excessive judgment standard.In addition,attention must be paid to the linkages and distinction between excessive performance costs and other systems that may involve changes in costs where applicable.At the same time,since the excessive cost of performance is essentially a special risk burden rule set to prevent inefficient continuous performance,the effect of the debtor's imputability on the application of the "excessive cost of performance" should also be considered.Based on the study of German law,this paper re-examines the definition of "excessive cost of performance".In terms of the composition of the performance costs,this paper argues that in addition to the monetary costs,it is also necessary to consider the opportunity costs and the additional burdens.And the determination of the reference object,should be combined with China's national judicial conditions to do flexible adjustment according to the different status: first of all to compare the performance interest of the creditors,if there is no special intangible interests or emotional preferences of the creditors in the subject matter of a contract,and then consider the remedy to perform the required fees(in the performance of unable to remedy the situation,shall be the equivalent of liquidated damages or compensatory damages),to balance the protection of the rights and interests of the creditors.Under the applicable conditions of "excessive cost of performance ",what legal effect will be produced must also be clarified in judicial practice.Typically,the excessive cost of performance does not directly lead to the frustration of contract,and,in theory,in terms of performance of the excessive cost is for the debtor with serious payment difficulties,is not for anyone else has the same difficult situation,therefore,whether the cost of performance is excessive or not should be claimed and proved by the debtor.In this regard,the property of "excessive cost of performance" is the right of defense.If the court rejects the debtor's defense,the debtor shall continue toperform.If the debtor's defense is upheld by the court,then the creditor's right to continue to perform claims is eliminated,and the creditor can request the debtor(the breaching party)to take remedial measures or compensate for the loss according to article 107 of the Contract Law.As for the debtor,due to the insufficient prestation of "excessive cost of performance",this defense would have excluded the creditor's claim for actual performance and freed him from the constraint of contractual obligations.