Research On The Transplanting Of The Theory Of Efficient Breach

The theory of efficient breach is one of the central theories of economic analysis in the area of contract law,which is originating from common law countries.In the Anglo-American legal system countries,the theory of efficient breach has obtained the legitimacy foundation.The analysis of legal issues through economic methods provides a new thinking path for pure legal analysis and forms a mature theoretical system of the theory of efficient breach.With the continuous development of China's economy and the prevalence of analytical jurisprudence,many scholars have begun to pay attention to the theory of efficient breach.Under the historical opportunity of compiling the civil code,whether our country can absorb the theory of efficient breach has become a research hotspot,which has practical significance for the study on the transplantation of the theory of efficient breach.The first part of the article is an analysis of the theory of efficient breach,including the connotation of the theory in Anglo-American law system and the study of the theory in China.Firstly,the connotation analysis of the theory of efficient breach contains the definition,types,applicable conditions,theoretical basis,value orientation and practical application in common law system.The development of the theory of efficient breach in common law system is rooted in the theory of the separation between law and morality,the theory that considers contract as an option to perform or pay,the theory of compensation function of remedy for breach of contract and the economic theory represented by Coase theorem,Pareto optimality and Kaldor-Hicks efficiency.At the same time,it pursues the value orientation of maximizing wealth and aims at increasing social wealth in general.Although there is much controversy about the theory of efficient breach,it is undeniable that the theory in Anglo-American legal system has found a theoretical doctrine that can be attached to its own legitimacy,and has been applied injudicial practice.Secondly,the study of the theory of efficient breach in China includes the domestic situation and comparison of relevant systems.At the current domestic level,China's legislation has not yet absorbed the theory of efficient breach,but judicial practice has begun to show that judges use the theory of efficient breach to adjudicate cases,and the different judgments of practice further highlight the necessity of examining the absorption of the theory;In terms of comparison of relevant systems,although there are similarities between the theory of efficient breach and China's existing principles,such as the principle of change of circumstances and anticipatory default system,there are still obvious differences,which also indicates that there is no possibility of substitution between the theory of efficient breach and China's system.Therefore,whether the theory of efficient breach can be transplanted to China needs further discussion.The second part mainly demonstrates the lack of legitimacy of the transplantation of the theory of efficient breach,that is,the theoretical defects of the theory,including the immoral and inefficient defects,which makes it impossible for the theory to obtain the legitimacy basis in our country.First of all,the theory of efficient breach requires that breaching contract is not morally reprehensible,but it is inevitable that some breaches of contract in our country are morally condemned.Moreover,the Contract Law permits punitive damages.So the theory of efficient breach can not meet the needs of the theory of the separation between law and morality in our country;secondly,the theory of efficient breach aims to maximize social wealth and achieve higher transaction efficiency.While compensation for damages cannot make up for the performance interests of the observant party and the theory leads to the increase of transaction costs,the application of the theory of efficient breach is inefficient.These factors lead to the loss of legitimacy of the transplantation of the theory of efficient breach in China.The third part of the article mainly examines whether the theory of efficient breach can be transplanted from the perspective of our country's contract system,and then draws the conclusion of "infeasibility".Firstly,China's liability for breach of contract has both compensatory and punitive functions,which can not satisfy the theoretical basis of compensation for breach of contract in terms of the theory of efficient breach;secondly,the rule of foresight in China is too general to be applied in practice and the calculation of damage lacks the time standard and the applicable method,which makes it impossible to limit the scope of compensation for breach of contract.The default party may obtain inefficient results and cannot meet the efficiency requirement of the theory of efficient breach;thirdly,the basic principle of honesty and credibility in our country is inseparable from morality and is contrary to the value orientation of the theory of efficient breach,which hinders the transplantation of the theory.So the transplantation of the theory in our country is not feasible.Therefore,the transplantation of the theory of efficient breach is illegitimate and infeasibility.Our country does not have the justification foundation and feasibility system required by the theory.Under the modern contractual order of our country,establishing a good market credit and a long-term stable trading relationship is undoubtedly the best way to improve transaction efficiency and realize social value.This way is obviously contrary to the pursuit of the theory of efficient breach,so we need to curb efficiency breaches.Observant parties' contractual rights can not be infringed,and efficiency breaches can be curbed from the perspective of actual performance,improvement of the punitive liquidated damages system and deprivation of benefits from breach of contract.