A Study On The Problems Of Breaching Party’s Application For Termination Of Contract In Contract Deadlock

Although Article 563 of "Civil Code(Draft)" deletes the provisions of Article 353,paragraph 3 of "Contract Part Draft(Second Review Draft)" regarding the support of the breaching party’s application for termination of the contract,in practice,the court ruled in favor of the breaching party’s cancellation.The number of contract cases has gradually increased,and the theoretical community has basically agreed that the breaching party should be allowed to appeal to the court to terminate the contract under the exceptional circumstances of contract deadlock.So,in the face of practical needs,it is still necessary to discuss whether the breaching party should be allowed to apply for the termination of the contract in the special case of contract deadlock,and to further discuss the criteria for determining the contract deadlock and the absence of new rules in Civil Code,how to choose the basis for the judgment to support the breaching party to terminate the contract under the circumstances.This article is divided into four parts without introduction and conclusion:The first part summarizes the judicial status of the breaching party applying for the court to terminate the contract dispute.In practice,the breaching party usually voluntarily appeals to the court to cancel the contract or counterclaims to cancel the contract when the performance cannot be performed or the performance cost is too high.When the breaching party cannot perform,the court usually supports the breaching party’s request and decides to terminate the contract,but the rules the court cited are not consistent.When the breaching party continues to perform the contract with excessively high costs,the court is inconsistent as to whether it should support the breaching party’s request to terminate the contract,when it supports the breaching party’s request to terminate the contract,and the basis of the rules cited.This article focuses on these three issues.The second part justifies the court’s exception to support the justification of the breaching party’s claim to rescind the contract.Generally speaking,based on the principles of contract freedom and strict contract observance,the judiciary should not decide to support the breach of contract by the breaching party.However,freedom of contract is not unlimited,and strict contract observance is not without exception.It should also be properly restricted and balanced by principles such as fairness,honesty and credibility.When a contract deadlock occurs and the mandatory continued performance of the contract will be obviously unfair to the breaching party,the court’s support for the breaching party’s request to terminate the contract adjusts the serious imbalanced interest relationship between the parties and meets the requirements of the principle of fairness.Moreover,the contract counterparty refuses to cancel the contract without even having the purpose of contract conclusion and can obtain full compensation.The act of“kick-off”also violates the principle of good faith.The court’s request to support the breaching party’s cancellation of the contract limits the contract counterparty.The freedom to exercise rights in bad faith meets the requirements of the principle of good faith.At the same time,in the face of contract stalemate,the court supports the breaching party’s request to rescind the contract,which is conducive to resolving disputes in a timely manner,mitigating the loss of the parties,and promoting the effective use of social resources and the maximization of overall benefits,which meet the requirements of efficiency value.The third part sorts out the specific circumstances that allow the breaching party to appeal the termination of the contract,that is,the criteria for judging the deadlock of the contract.From the perspective of constituent elements,it should be limited to the non-malicious breach of the breach by the defaulting party,the breaching party’s inability to perform the contract or the continued performance of the contract is obviously unfair to the defaulting party,and the nonaffecting changes caused the continued performance of the contract to the defaulting party.Violation of the principle of good faith requires the breaching party to continue to perform the four elements of the contract,while the theory and practice say that the contract cannot be fulfilled,so that the purpose of the contract cannot be achieved,and the negligence of the opponent’s negligence of the exercise of the right of cancellation constitutes an abuse of rights.From the perspective of typification,the execution of continuous contracts such as house rental contracts,contracts for commercial housing sales that inherently include a divisional commercial operation or internal related operation contracts,and contracts that require subsequent continued investment contracts are more likely to occur contract deadlock.The fourth part explores the basis of the court’s decision to support the breach of contract by the breaching party.Article 563 of "Civil Code(Draft)" deletes the provisions of Article 353,paragraph 3 of "Contract Part Draft(Second Review Draft)" that can exceptionally support the breaching party’s claim to rescind the contract.The court can only use the existing rules in the future.In this regard,scholars have proposed different claims that can be judged based on rules such as Article 94,Article 110,and Article 116 of Contract Law or Article 26 of the Judicial Interpretation of Contract Law(2).The "party" in Article 94 of Contract Law does not include the breaching party.There is a substantial difference between the contract deadlock and the situation changes,so the court cannot rely on Article 94 of Contract Law or Article 26 of the Judicial Interpretation of Contract Law(2)to support the breaching party’s request to terminate the contract.Moreover,it is difficult for the court to indirectly urge the party to terminate the contract voluntarily by applying Article 116 of Contract Law.Although strictly in accordance with the meaning of Article 110 of Contract Law,the court cannot directly terminate the contract,and the article cannot be applied to monetary debt,but the court can rely on the interpretation of Article 110 of Contract Law as a judgment basis,that is,to expand the interpretation of the meaning of "Excessive Performance Costs" in Article 110,paragraph 2 of Contract Law,and to expand the legal effect of the provisions of Article 110 of Contract Law to give the breaching party the initiative to apply for terminating the contract and make a judgment on the situation in which the breaching party continues to perform monetary debts in an apparently unfair manner by analogy with the provisions of Article 110,paragraph 2 of Contract Law "Excessive Performance Costs".