Application Of The Fundamental Breach System In CISG In The Field Of International Trade

With the rapid development of international economic integration,the frequency of trade among regions has been accelerated and the degree of trade among regions is also deepening.The differences in legal environment of different countries have led to different understandings between the two sides of the trade,which have led to the continuous emergence of disputes between traders.Among them,according to the commodity form of trade,the disputes in the international trade in goods are more frequent.Therefore,it has become the goal of all countries to work out a unified transaction law to coordinate the sale of goods between countries.In the 1980s,the United Nations Convention on Contracts for the international sale of goods was promulgated,which has not only influenced the uniform legal norms applicable to international transactions,but also had a significant impact on the reform of relevant domestic laws of various countries.Among them,one of the biggest highlights is the fundamental breach of contract system,which is an indispensable and important system in international trade contracts.It helps defining the scope of power exercise,clearing boundary right or giving effective relief to minimize the cost and creating a relatively free space for the conduct of economic activities.In this space,it is helpful for the parties to negotiate about the allocation of property rights according to their true wishes and obtain a balance between the transaction cost and the gains,so as to achieve the goal of operation,improve efficiency and ensure the effective use of resources.On this basis,it can ensure the justice and fairness of the law and the maximization of the social economy output.At the same time,discussing the fundamental breach of contract system from the perspective of the practice of international sale of goods helps to embed international factors into Chinese law so that the parties to the contract may avoid the dilemma caused by the incoherence of domestic and foreign laws and the misunderstanding and conflict in trade caused by the different application of laws.This paper takes a case of contract dispute in international goods sale as an entry point and adopts typical case analysis,comparative study,comprehensive analysis and inductive analysis.The definition,origin and historical development of fundamental breach of contract system and comparative analysis of the foreign typical system of fundamental breach give an in-depth understanding of the origin of fundamental breach of contract system and performance in the legal system.Then this paper takes a further analysis of the elements of fundamental breach system,the identification in practice and the legal consequences and special treatment of fundamental breaches.Subsequently,the paper combines the application of law and criterion for fundamental breach in this case to summarize the reasons for the inconsistency between the two trials,which provides a reference for China to resolve similar disputes over international contracts for the sale of goods.The significance of this paper is to provoke Chinese companies to understand the fundamental breach of contract and its application when facing international contract disputes.In international trade,the initial definition of the rights of both parties to the transaction is conducive to the effective allocation of final resources and is of great significance for the realization of the optimal overall social efficiency.At the same time,the empowerment of the relevant rights of both parties to the transaction also influences the distribution of ultimate responsibility.The innovation of this article is to introduce the relevant content of Coase Theorem to examine the reasonable channels of remedy for breach of contract,and to study the related disputes arising from the fundamental breach in international trade from the perspective of economics,rather than as a study of legal issues.The main part of this article is divided into three parts for writing.The first part is the basic overview of the case.Sort out and analyze the case of the dispute over the international goods sale contract between ThyssenKrupp Metallurgical Products Co.,Ltd.and Sino chem International(Singapore)Corporation,Then dig the details of the case and comparatively analyze and collate the thoughts and sentencing opinions of the judgments of the first and second instance courts so as to bring the focus of disputes between the two judgments and point out the importance of discussing these focuses of disputes.The second part mainly focuses on the study of fundamental breach of contract system,mainly divided into three levels.Firstly,this paper discusses the applicable law of this case and analyzes the scope of application of the provisions of the CISG from three aspects:the subject,the object and the autonomy of will of the parties.Then this paper combines the details of the case to analyze the CISG.Secondly,this paper discusses the judgment standard of fundamental breach of contract.Starting from the constituent elements of the CISG,it analyzes the provisions of the CISG on breach of contract obligations,the judgment on the damage of the breaching party,and the definition of the predictability of breach of contract.Combining with the details of the case,it demonstrates whether the delivery of disputed goods by Krupp constitutes a fundamental breach of contract.Finally,this paper analyzes and states the origin and historical development of the fundamental default system and then compares it with the typical foreign fundamental default system,so as to have an in-depth understanding of the origin of the fundamental default system and its performance in various legal systems.The third part is the enlightenment of this case to our country.Based on the interpretation of the Convention and the relevant provisions of the Convention,this part analyzes the differences between the two court trials and summarizes the defects in the application and understanding of the system of fundamental breach of contract in China as a Contracting Party of the CISGF,so as to clarify the principle of uniform application of the CISG and the relevant elements of the system of fundamental breach of contract that should be adhered to in the foreign judicial trial.It is of great significance to analyze the fundamental breach of contract system from the perspective of improving the contract law of China.Through the analysis of this typical case,we can see that this case has gone through two trials and the courts both used the fundamental breach clause of CISG,but the judgment results are inconsistent.On the one hand,it can be explained that the CISG has a more flexible interpretation of the definition of a fundamental breach of contract.Secondly,since the CISG does not have a specialized referee or interpreting agency,it is easy to understand the fundamental breach of contract with the "stereotype" of the original domestic law,which leads to fall into the error of "nationalization" of fundamental breaches.Therefore,in the international legal environment,it is necessary to analyze and understand with the help of typical international cases of fundamental breach of contract,try to overcome the "nationalization" understanding of the elements of fundamental breach of contract and actively promote the unified interpretation and application of fundamental breach of contract under the framework of the CISG.At the same time,it is also necessary to use the fundamental breach system of the CISG for reference to modify the relevant parts of Chinese contract law to realize the integration of the contract provisions in the international legal environment,so that we can have a deep understanding of the rights and obligations of both parties as well as the possible risks of breach of contract according to the provisions of the laws of our country when signing the contract,so as to provide convenience for Chinese enterprises to participate in the international sales of goods and achieve good development.