Study On Risk-bearing Rules Of Sales Contracts

China’s risk-bearing rules of sales contracts seem to be detailed,but in fact,there are some doubts in the application.The general rules,the special rules in the case of default and the risk burden of special sales,are all to be explained.Based on the theory of interpretation,this paper makes an all-round study of the risk-bearing rules of sales contracts in China’s positive law.Chapter 1 discusses the general rules of sales contracts’ burden of risk.Section 1clarifies that the mode of sales contracts’ burden of risk in China is the principle of delivery.Section 2 distinguishes the different situations of delivery and determines the time when the risk is transferred.Firstly,in the case of delivery by means of a possession assistant or a possession mediator,the risk of the sales contract is transferred when the party of assignor delivers to the party of assignee.Secondly,simply abolishing or establishing an relationship of auxiliary possession can complete the delivery,and the risk of the sales contract will also be transferred.Thirdly,in the case where the possession assistant or the possession mediator moves to the assignee’s dominance,the risk transfers to the buyer when the seller’s notice reaches the possession assistant or the possession mediator and the buyer establish a new relationship of intermediary possession.Fourthly,in the acquisition based on the order,risk of both sales contracts is borne by the buyer from the time when the orderee delivers the subject matter to the assignee.Section 3 investigates the risk-bearingrules in fictional delivery cases.When simple delivery,directed delivery or conversion of possession is established,the risk passes.However,in the case where the requirements for simple delivery or conversion of possession are met,if the parties have the opposite intention,it will not be deemed as delivery and the risk will not be transferred.Section 4 is about sending sales’ burden of risk,and the time when the risk transfers is advanced to the delivery to the carrier.In sending sales,the place of performance is different from the place of fulfillment.The seller’s residence or place business is the place of performance,while the buyer’s residence or place of business is the place of fulfillment.Whether the carrier includes the seller,his/her employee or his/her agent is a legislative policy issue,which should be stipulated in the future civil code.Chapter 2 probes into the risk-bearing rules in the case of default.Section 1defines the question.The risk-bearing issue in the case of default refers to the question who bears the risk of the sales contract if the subject matter is damaged or lost due to causes not attributable to both parties after the breach of the contract by one party.In the case of refusal to perform,there is no risk-bearing issue.Section 2relates to the situation of delay in performance.If the buyer terminates the contract or refuses to receive the subject matter,the seller has no right to deliver,and there is no risk-bearing issue.If the seller has the right to deliver,he/she shall bear the risk of delay,except where timely performance cannot prevent the damage or loss of the goods.Section 3 deals with incomplete performance.Above all,the general rule is that risk moves from the time of delivery.Next,if the subject matter is delivered in excess,the risk of the goods within the agreed quantity shall be transferred to the buyer upon delivery.Who bears the risk of overpaying part depends on whether the buyer receives it.Finally,quality defects causing the fundamental breach of a contract is discussed.As a precondition,it is necessary to find orientation for the right of rejection in the system.In Chinese law,the right of rejection is one of the rights after the buyer inspects the goods and finds the quality defects,and it is also the right enforced when the buyer requests to change,redo or return the goods after receiving it.The "rejection" in Article 148 of Contract Law of PRC is limited to the rejection inthe case of return of goods.In the case of fundamental breach of a contract caused by quality defects,whether the buyer rejects the subject matter or terminates the contract before or after the occurrence of risk,the risk shall be borne by the seller.Section 4refers to the risk burden on the occasion of delay of reception.Even if it is unable to avoid the risk if the buyer receives the goods in time,the buyer shall bear the risk.Chapter 3 studies the risk-bearing rules of special sales.Section 1 defines the scope of application of the general rules in special sales.The principle of delivery applies to title retention sales,installment sales,sample sales and auctions.Section 2analyzes the risk burden of trial sales.The seller shall bear the risk during the probation period.Section 3 explores the risk burden of trading of goods in transit.The civil code of China can insist on the rule of formation of contract,and there is no need to turn to the rule of Free Carrier.As for whether the third sentence of Article 68 of CISG should be imitated,there is little difference in legal effect.Section 4 focuses on the risk burden of real estate sales.First,regardless of the delivery and the registration of which is the first,the point that risk of the real estate sales transfers is delivery.Second,in the double sales of real estate,there is no risk-burden issue between the seller and the buyer of possession,and what happens is failure of performance attributed to the seller.The risk between the seller and the registered buyer shall be borne by the seller.