国际商法

International Commercial Law

Teaching Plan

●Part I Introduction to Law ●Part II Contract Law ●Part III Corporate Law References ?《国际商法》（英文 ）主编：肖云南 清华大学出版 ?《国际商法》 陈慧芳著 立信会计出版社 ?《英国合同法》（中文）何宝玉，中国政法大学出版社 ?《英美合同法》 （英汉对照）张自明，机械工业出版社 ?《英美公司法》 （英汉对照）机械工业出版社

? 英国法精要系列 contract law，以及 company law 武汉大学出版社 ? PPT

LECTURE1 Introduction to Law ●Law and Business Law system ●Law systems

●Courts and Litigation ●Alternatives to Litigation

Law and business

Why do business students study law?

1.law is the foundation for the private marketplace in the modern society. 2.It is a compulsory course for business school.

3.It is also a discipline required to pass Certified Public Accountant Exam, AICPA

Law Systems

●Common law system普通法法系 (英美法法系 Anglo-American law system)

●Continental law system大陆法系\\民法法系\\罗马法法系（civil law system or Roman law system)

Civil Law System

●The civil law system is the general typology of legal systems found in most countries. It is an alternative to common law system and has its roots in Roman Law. It is employed by almost every country that was not a colony of the British Empire, eg: France, Germany.

●In most jurisdictions the civil law is codified in the form of civil codes, but in some, like Scotland it remains uncodified. Most codes follow the tradition of Code Napoléon in some fashion. Notably, the German code was developed from Roman law with reference to German legal tradition.

●Civil law relies on legislation, rather than judicial decisions for law. Civil law system does not recognize judge-made law.

Common Law system

●Common law is a system of law used in England, all of the states of the United States (except Louisiana) and other former British possessions such as Australia, Canada (except Quebec), India, Ireland, Jamaica, New Zealand and Hong Kong.

●Common law system emphasizes the role of judges in determining the meaning of laws and how they apply. It arose beginning in the eleventh and twelfth centuries as the English monarch appointed royal judges to resolve disputes in the name of the king (or queen). As there are little formal law to apply to many disputes, the decisions handed down by the judges literally made the law.

Law System in the World …(图略)

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Chinese Law

●The Law of China, for most of the history of China, was rooted in the Confucian philosophy of social control. These influences remain in the contemporary legal system of the People's Republic of China. PRC has been influenced by a number of sources including traditional Chinese views toward the role of law, the PRC's socialist background, the German-based law in Taiwan Province, and the English-based common law used in Hong Kong SAR. The law of the United States has also been very influential particularly in the area of banking and securities law.

Question ?

Many scholars think that Chinese legal system belongs to Civil Law system. What do u think? Show me evidences.

Answer

●The Chinese legal system has similar characteristics to a civil law system

●This is partly because in Chinese history written laws and codes were important, as far back as the Qin Dynasty

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●Also partly due to European influences on China in the 19 and 20 centuries

●The Chinese legal system is distinct from other legal systems, but its structure is similar to civil systems like France and Germany

In fact, case law is not considered to be a source of law in China, though decisions published in Bulletin of the Supreme People's Court are used as a guideline by lower courts when the law is unclear.

Definition of law

●What is law? Many definitions ●Law is made up of three elements:

1.Formal legislation 2.Rules of law in cases 3.Legal concepts

●The rule of law : ― a government of laws and not of men‖

Classification of law

There are several ways of classifying legal subjects.

●Public law and private law.

1.Public law includes constitutional law, administrative law. and criminal law. In public law the interests of society are represented by the State.

2.Private law involves those legal problems which exist between individuals, and is divided into the law of contract, law of torts, and law of property.

●Substantive law and procedural law.

1.Substantive law defines legal relationships between people or between individuals and the State. …

2. Procedural law deals with the means by which substantive law is administered. Rules involving the method of conducting trials, appeals, and enforcement of judgments are examples of procedural law. …

●Civil law and criminal law. .Civil law Criminal law 1.Deals with the relationships between individual 1.Deals with rules created by the State which citizens forbid certain behaviour, which are ―crimes‖ 2

2.Its purpose is to settle arguments between 2.Criminal law punishes people individuals It does not provide remedies 3.It helps people to find remedies 3.Criminal law is usually what people think of It doesn’t really punish people when they think about ―the law‖, (arrest imprisonment) 4.Civil Law includes all Private Law and some 4.Criminal law is part of public law public law Civil Case and Criminal Case

1.●Civil cases may include suits for breach of contract or tort (侵权） cases, such as suits for personal injuries. Typically, they involve a request for damages of the wrongdoer. Civil Law includes all Private Law and some Public Law.

●In a civil case, the parties only have to prove their case on the balance of probabilities ●In a civil case, each party is usually represented by a lawyer Person who starts an action is the Plaintiff The person who is being sued is the Defendant

2.●Criminal cases (be charged with a crime) involve a representative of government attempting to prove the wrong committed against society and seeking to have the wrongdoer punished by the court system.

●In a criminal case, the prosecutors (ie the State) must prove their case beyond reasonable doubt

Sources of Law

Law comes from four basic sources:

1. Constitutions. 2. Legislation.

3. Judicial decisions . 4. Regulations

●Constitutions are the basic and supreme law.

●Most of our laws are found in some form of legislation.

●Judge-made (judicial decisions) law is often called common law. Common law is based on the principle stare decisis, which means that in present cases courts follow decisions (precedents) laid down in prior cases. In a sense, courts also ―make law‖ when they interpret constitutions, statutes, and regulatory rules and decisions.

Legal sanctions

●The methods for forcing obedience to the law are called sanctions, which are a form of punishment. The 14th Amendment to the Constitution guarantees that we will not be punished (―deprived of life, liberty, or property‖) by the state without a ―due process‖ of law. One sanction enables a person to take another's money or property .This sanction is known as a remedy. ●Consider the following sanctions for following legal conduct:

1. Criminal conduct. 2. Breach of contract. 3. Tortious conduct.

4. Violating Statutes and regulations

For Criminal Conduct

A. Criminal law involves wrongs against society that the state punishes. Sanctions for crime includes:

1. Death.

2. Imprisonment. 3. Fine.

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4. Removal from office.

5. Disqualification from holding office and from voting.

B. Criminal law is generally divided into felonies and misdemeanors. 1. Felonies are punishable by fine or imprisonment of one year or more. 2. Misdemeanors are punishable by a fine or imprisonment of less than one year. 3. Violations of traffic ordinances, building codes, and other local ordinances are sometimes called the petty offenses. C. White-collar crime is on the increase. White-collar crime is nonviolent crime conducted by businesspersons. E.g.: tax fraud, misrepresentation in financial statements, corporate crime. There have been many proposals made for reducing crime in general and white-collar crime in particular.

For Breach of Contract

A. A contract is a legally binding agreement between persons. Courts recognize that persons have a duty to live up to their contracts, and the law provides remedies for breach of contracts.

B. When one party to a contract fails to do what he or she agreed, a breach of contract occurs. C. The usual remedy for a breach of contract is a lawsuit for dollar damages. These damages are called compensatory damages and are designed to make the victim ―whole‖ again for all losses that arise directly and foreseeable from a contract's breach.

D. Breach of contract cases may also award consequential damages when the breaching party had reason to know of special circumstances that would cause the other party to suffer additional damages if the contract were breached. Example: X contracts to sell Y a ditch digger, knowing that Y has a contract with Z to dig ditches. The digger that X supplies is defective, Y cannot dig the ditches for Z, and Y loses Z'S business. Y sues X. The damages required to fix the defective digger are compensatory damages. Y's lost profi1s on the contract with Z are consequential damages.

E. When the parties agree in their contract as to what damages for breach will be, these are called liquidated damages. F. Other remedies: Cancellation and rescission , and Specific performance

For Tortious Conduct

A. A tort is a non-contractual civil wrong for which the law gives a right to recover damages. The same act may be both a tort and a crime, e.g., an assault. B. Tort liability assumes that in a civilized society people will not intentionally injure others or their property, and that all persons will exercise reasonable care in their activities.

1. Intentional torts include assault and battery, false imprisonment, libel, trespass and conversion. 2. Negligence liability arises from an injury caused by a failure to exercise the duty of reasonable care.

C. If the plaintiff wins a tort case, he or she is awarded damages. These damages may include

1. Compensatory damages that compensate for medical expenses, loss of income, and pain and suffering.

2. Punitive damages that punish the defendant when the defendant's conduct is intentional, fraudulent, or reckless.

D. Major areas of tort litigation today include:

1.Malpractice, which is professional negligence by persons like accountants, lawyers, physicians, and engineers.

2. Product liability, which is the area of torts involving injuries arising from defectiveIy designed or manufactured products.

For Violating Statutes and Regulations

Employment law, labor law, securities law, and antitrust law often use of various forms of these sanctions:

1. Fine and imprisonment. 2. Damages.

3. Seizure of property.

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4. Injunction which is an order by the judge (court) to prevent future violations or correct past ones.

LECTURE 2

Courts

●Jurisdiction refers to a court’s power over the parties to a lawsuit and over what the lawsuit is about .

●According to jurisdictions, courts are divided into different levels. e.g.: district (county) court, intermediate level court of appeals, state (province) high court, supreme courts

●In most countries, a case usually will be tried by three levels of courts before a final ruling is decided. i.e.: the third instance is the final instance. However, in China, the second instance is the final instance.

China

America

American court system consists of federal court system and state court system .The basic trial court is district court, known as circuit court, superior court, or court of common pleas, even supreme court in New York . They have general jurisdiction ,which means that they have power to hear almost any type of case ………Federal courts have limited jurisdiction, dealing questions of federal law, the constitution, matters in which the USA is a party, controversies between states, and suits between citizens of different states. UK

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Personnel

●The people who operate court system: ●Judges and Justices

1.Judge try cases and direct contact with litigation and litigants.

2.Justices hear appeals from the legal decisions made by trial courts. They give reasons for their decisions in written form, which become precedents and a part of case law. They are concerned with issues of law . ….

Jurors

●The constitution guarantee the right of trial by jury in both criminal and civil cases (amount in controversy exceeds $20).

●A grand jury determines whether there is sufficient evidence for guilt to warrant indictment. ●A petit jury determines the facts at a trial. Their decision must be unanimous in most states.

Lawyers

●Lawyers are required to represent most parties in most court cases. ●Corporation cannot come to court except through lawyers.

●A lawyer servers in three capacities: counselor, advocate, and public servant.

●The attorney-client privilege does not permit a lawyer to testify as to facts told him or her by a client.

The function of judicial process ●Judicial review

It allows the courts to review laws passed by legislature and actions taken by the executive branch and to declare them unconstitutional.( Marbury v. Madison) The interpretation of legislation

●Case law it refers to the total collection of judicial opinions made by justices

Litigation

●Names of Parties

In criminal cases a prosecutor（representing the people of the state） brings action against a named defendant. In civil cases the plaintiff describes the party who sues．There are some instances， especially in courts of equity，In which the parties are called petitioner and respondent．When a counterclaim is flied，the parties are described as counter-plaintiff and counter- defendant. ．When a trial court decision is appealed，the party appealing is referred to as appellant，and the other party is called appellee . The parties to a lawsuit (the plaintiff and the defendant）are often called litigants.

Alternative to litigation

There are a variety of ways to settle disputes without going to trial, called alternative dispute resolutions(ADR)

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They include:

1. Mock and minitrials 2. Mediation 3. Arbitration

l. Mock Trials and Minitrials

A. A Mock Trials involves a pretend jury. The lawyers to a dispute pay a group of citizens to act as a jury and hear the evidence in a dispute. Often the observations of this mock jury about the evidence will 1ead the parties to a dispute to sett1e without going to a real trial. ln a

B. Another ADR is minitrial, in a minitrial the lawyers to a business dispute present evidence to executives of both companies. After hearing the evidence, the executives often settle their companies' dispute.

C. Mock trials and minitrials are quick, confidential, and cheap in comparison with actual litigation.

ll. Mediation

Mediation describes a process in which a third party is brought into a controversy to help settle a dispute. A mediator cannot impose a solution upon the parties, but a mediator’s viewpoint and suggestions are given significant weight.

III. Arbitration

in arbitration a neutral third party makes a binding decision about a dispute. Many business contracts contain an arbitration clause under which the parties agree to arbitrate. Some legislation requires the arbitration of certain disputes.

LECTURE3

Sources of Int’l Commercial Law ●National law

Chinese contract law. UCC ●Int’l treaties and conventions

CISG United Nations Convention on Contracts for the International Sale of Goods ●Int’l model law

PICC国际商事合同通则 ●Int’l trade customs and usages

( Incoterms 2000 ，international commerce terms即2000年国际贸易术语解释通则。它是由国际商会(International Chamber of Commerce, ICC)制定并作出统一解释 )

The convention: CISG

●In 1966, the United Nation created the U.N.Commission on International Trade Law. (UNCITRAL)联合国国际贸易法委员会

●UNCITRAL has drafted several widely accepted legal codes for international business, including the Convention on Contracts for the International Sale of Goods, or CISG. If a case involving the sale of goods between a Chinese firm and a party whose place of business is in another country that has adopted CISG, the CISG would apply.

The model law: PICC

●The International Institute for the Unification of Private Law (UNIDROIT) was set up in 1926 under the League of Nations. The Principles of International Commercial Contracts (PICC) were proposed by UNIDROIT as model laws to harmonize different domestic contract laws.

●They shall be applied when the parties have agreed that their contract be governed by them.

●They may be applied when the parties have agreed that their contract be governed by general

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principles of law, the lex mercatoria商人习惯法or the like. They may be applied when the parties have not chosen any law to govern their contract. ●Consider: Is PICC an international convention as CISG?

The applicability of the CISG Three conditions for CISG to apply:

a. The contract is for the commercial sale of goods. (so sale of service contract excluded.)

b. It is between parties whose places of business are in different countries. ( not nationality or citizenship)

c. The place of business are located in countries that have ratified the convention.

Sales excluded from CISG

1. Consumer goods sold for personal, family or household use. 2. Goods bought at auction.

3. Stocks, securities, negotiable instruments or money. 4. Ships, vessels, or aircraft. 5. Electricity.

6. Assembly contracts for the supply of goods to be manufactured or produced wherein the buyer provides a substantial part of the materials necessary for such manufacture or production 7. Contracts that are in preponderant part of the supply of labor or other services. 8. Liability of the seller for death or personal injury caused by the goods.

9. Contracts where the parties specifically agree to opt out of the convention or here they chose to be bound by some other law.

Contract law

Contract: a legally enforceable agreement

●―A promise or set of promises,( for breach of which the law gives a remedy, or performance of which the law in some way recognizes as a duty.) which the law will enforce.‖

●Contract is an Agreement giving rise to obligations which are enforced or recongnised by law.

●A contract is an agreement between two parties by which both are bound in law and which can therefore be enforced in a court or other equivalent forum．

●Contracts are distinguished from agreements，which are not binding. E.g. social agreement; meet for dinner, promise to see film

How do u judge if a contract exists?

There are three key ingredients to formation：

●Agreement —based on mutuality over the terms，agreement exists when a valid acceptance follows a valid offer；

●Consideration —given by both sides，one’s benefit is from one’s detriment, the proof of exchange of bargain；

●Intention to create legal relations —since a contract is legally enforceable, unlike mere gratuitous promises．

Intention to create legal relations

●中国继承德国法：具有法律意图的行为为―法律行为 legal juristic act‖，即能产生法律后果的行为。

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Common law: Intention to create legal relations based on two rebuttable presumptions One presumption: No Intention in in Domestic & social arrangements ●Agreements not usually enforceable: couple, parents and children (Balfour v Balfour, Jones v Padavatton)

●Agreements usually enforceable: estranged couples, domestic arrangements where money changed hands, or one party has suffered to comply with agreement

The other presumption: having INTENTION in Business, commercial transactions ●Agreements usually enforceable: informal arrangements linked to a legal requirement, free gifts made to increase business

●Agreements not usually enforceable: specifically written to exclude legal enforcement, letter of intent, pledge clauses, comfort letters

Elements of a contract ●Offer and acceptance ●Reality of consent ●Consideration ●Legality

●Contractual capacity

●Possible requirement of a writing …..e.g.

Classification of contracts

●Executed and executory contracts ●Bilateral and unilateral contracts ●Express and implied contracts implied-in-law, implied-in-fact

●Valid , voidable, void, and unenforceable contracts ●Formal and informal contracts

contract of seal, contract of record simple contract

LECTURE4 Entering Contract

Entering Contract

●The mutual agreement is reached through the bargaining process, between offferor and offeree until the offeree accepted the offer.构成合同协议的基本要素有两个：一是要约，一是承诺。

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中国《合同法》对要约条件的规定 ●第一，要约必须具有订立合同的意图; ●第二，要约必须向特定的受要约人发出; ●第三，要约的内容必须确定;

●第四， 要约必须送达受要约人。

The character of offer 1. The character of an offer

●A statement of willingness to be bound by the terms of the offer． ●Must be distinguished from an invitation to treat

Invitation to offer

●An invitation to offer or invitation to treat is simply an expression of willingness to enter into negotiations which, it is hoped, will lead to the conclusion of a contract at a later date.

要约邀请无强制效力。中国合同法规定：价目表、拍卖公告、招标公告、招股说明书、商业广告等为要约邀请。商业广告的内容符合要约规定的，视为要约。 ●Ad, catalog information, price tickets in store, circulars,…

Display of goods for sale in a supermarket

●Case: Pharmaceutical society of GB v. Boots Cash Chemists

●Boots organized their shop on a self-service basis. They were charged with a breach of section 18(1) of the Pharmacy and Poisons Act 1933, which required that a sale of drugs take place under the supervision of a registered pharmacist. There was no pharmacist present close to the shelves, but a pharmacist supervised the transaction at the cash desk and was authorized to prevent a customer from purchasing any drug if he thought fit to do so.

●争议：哪个阶段是要约，哪个阶段是承诺？

药物学会认为：货架摆放药品，显示价格是要约，顾客取走药品是承诺，合同成立时，没有药师监督，boots违反法律规定。

Boots认为：摆放药品是要约邀请，顾客取走药品是要约，收银是承诺，收银时有药师监督，故没有违反法律。

Advertisement

●The general rule is that a commercial advertisement is an invitation to treat rather than an offer. In Germany, advertisement is only a invitation to offer. While in common law legal system, if it can be proved that the maker of the advertisement is willing to be bound by the advertisement and the advertisement has clearly provided sufficient information of the goods, advertisement can also be offer.

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CISG: an advertisement is presumed to be an invitation unless the contrary is clearly indicted by the person making the proposal.

Example

●The Daily Tribune prints a Baker Department Store AD which reads, ―Five Model No. 723TVs $175 each, first Served.‖Courts have held this to be a legal offer allowing the first five Customers their money to be acceptors of the offer.

The character of Offer (cont.) 2. Communicating an offer

●Must be communicated to the offeree

●Can be made to an individual or to the whole world ●The terms must be certain

Case study: Carlill v. Carbolic Smoke Ball

●The defendants, who were the manufacturers of the carbolic smoke ball, issued an advertisement in which they offered to pay 100 pound to any person who caught flu after having used one of their smoke balls in the specified manner, and they deposited 1,000 pound in the bank to show their good faith. The claimant caught flu after using the smoke ball in the specified manner. She sued for the 100 pound.

●The judge held that the advertisement is an offer to the whole world and that a contract was made with those persons who performed the condition on the faith of the advertisement.

Example

●Harry has a dangerous broken front porch step which she ―orders‖ repaired by the local carpenter ―ASAP‖. The time of performance and rate of pay are not mentioned by parties. In this disputes, how could the court rule?

The court could rule that ●The contract was made ●Reasonable price ●Reasonable time limit

Example

●Adam informs his two friends that by pretending to offer his 19X1 Honda for sale at $1,000 he can ―get Baker excited.‖ Baker listens to the offer, is excited over the bargain, and accepts. As a reasonable person might do. Adam can easily prove his secret intention of a ―joking offer,‖ . How could the court rule?

The court could rule …

●But a court could allow the agreement to stand under the objective theory of contracts.

●SECRET INTENTION contract is the result of a meeting of the minds of the parties. This meeting of the minds is measured, however, by an objective rather than a subjective standard.

Auction sales/bids

Step 1. Advertisement of auction or a statement of auction Step 2. The auctioneer invites the bids

Step 3. The prospective buyers bids for the commodity Step 4. The auctioneer strikes the table.

Which step is offer, and which step is acceptance? Case: British Car Auctions Ltd v. Wright

上述拍卖方式为欧式拍卖，在荷式拍卖中（降价拍卖），可有不同？

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Tenders

●Where a person invites tenders for a particular project, the general rule is that the invitation to tender is simply an invitation to treat. The offer is made by the person who submits the tender and the acceptance is made when the person inviting the tenders accepts one of them.

Termination of offer

a. The offeror or offeree died.

b. No acceptance was sent before the offer expires.

The offer remains open for the period specified by the offeror or, in the absence of such, for a reasonable length of time according to circumstances. E.g.. case of engineer resign

c. An offer may be withdrawn if the withdrawal reaches the offeree before or at the same time as the offer. 撤回 Until a contract is concluded an offer may be revoked if the revocation reaches the offeree before he has dispatched an acceptance. 撤销

d. Public offer can be revoke in the same manner as the offer was made even if the offeree’s ignorance of the revocation.

Exceptions for revocation of offer under CISG and China’s law However, an offer cannot be revoked under CISG:

(a) if it indicates, whether by stating a fixed time for acceptance or otherwise, that it is irrevocable; or (b) if it was reasonable for the offeree to rely on the offer as being irrevocable and the offeree has acted in reliance on the offer.

e. An offer, even if it is irrevocable, is terminated when a rejection reaches the offeror.

Exceptions for revocation of offer under UCC

●Generally, the power of the offeror to revoke persists even if the offeror agreed to keep the offer open for a definite future period. Three exceptions: ●Option: given for legal consideration

●Firm offers: written promise by merchants to keep the offer open not in excess of 3 month.

●Unilateral offer made to another who is acting on such an offer may not be revoked due to promissory estoppel.

Option特权

Laslow needed time to find financing for the purchase of Olson’s house.) Olson promise in writing to keep the offer open for 30 days. Ten days later Olson found another buyer and notified Laslow, The offer was revoked when Laslow was notified, or otherwise learned, of the sale. However if Laslow had made deposit of, say, $100 (called consideration) for Olson’s promise to keep the offer open, an option would have been created. Options cannot be revoked.

Case of Revocation of offer ●Byrne v. Van Tienhoven

●The defendants sent the claimants an offer on 1 October, which reached claimants on 10 October, the claimant accepted the offer by fax on 11 October . However, in the meantime, the defendants had sent, on 8 October, a letter revoking their offer, which reached the claimants on 20 October. Was there a contract? When was the contract entered?

●It was held that a contract was concluded between the parties on 11 October because the purported withdrawal could not take effect until 20 October.

Acceptance

●The acceptance is the offeree’s manifestation of the intention to be bound to the terms of the offer. ●The conditions of acceptance:

a. An acceptance must be made before the offer expires.

b. The acceptance must be unconditional and absolute, with the same contents as the offer. c. The acceptance must be made by offeree to offeror.

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Mirror image rule

●A purported acceptance which does not accept all the terms and conditions proposed by the offeror but which in fact introduces new terms is not an acceptance but a counter-offer, which is then treated as new offer. The effect of the counter-offer is to kill off the original offer so that it cannot subsequently be accepted by the offeree. (mirror image rule) ●Case: Hyde v. Wrench

●The defendant offered to sell some land to the claimant for 1000, and the claimant replied by offering to purchase the land for 950. The defendant refused. So the claimant agreed to pay 1000. But the defendant still refused to sell.

Did a contract conclude between the parties?

Exception of mirror image rule

●A reply to an offer which purports to be an acceptance but contains additional or different terms which do not materially alter the terms of the offer constitutes an acceptance, unless the offeror, without undue delay, objects orally to the discrepancy or dispatches a notice to that effect. If he does not so object, the terms of the contract are the terms of the offer with the modifications contained in the acceptance. Eg : delivery, credit period, financial statement.

●Additional or different terms relating, among other things, to the price, payment, quality and quantity of the goods, place of delivery, extent of one party’s liability to the other or the settlement of disputes are considered to alter the terms of the offer materially.

Example

A developer offers a housepainter $600 per house for the four houses he will paint, $500 in advance, the balance on completion, and work to commence this week The housepainter may reply in a number of ways: ―No‖ (rejection); ―Yes, but $1,000 down‖ (a counteroffer and also a rejection); ―Sounds okay. but can you raise it a bit?‖ (neither an acceptance nor a rejection); ―Yes. Is it okay if I begin n; next week?’ (acceptance, accompanied by inquiry).

Acceptance and sale of goods

Section 2-207(1) of the UCC, ―a definite and seasonable expression of acceptance or a written confirmation.. .operates as an acceptance even if it states terms additional to or different from those offered or agreed upon‖ unless the acceptor had clearly made his or her acceptance conditional on those other terms. If it does not appear the offeree means to make a counteroffer or reject the offer, a contract exists.

●A----B ―$75 each, 30days, 90days creditor‖ ●B---A ―$75 each, 30days, 60days creditor‖

Acceptance in ignorance of the offer (Cross offer)

●A person who , in ignorance of the offer, performs the act or acts requested by the offeror is not entitled to sue as on a contract. (悬赏广告除外）

●Cross offers which are identical do not create a contract unless or until they are accepted.

Prescribed method of acceptance

●Where the offeror prescribes a specific method of acceptance, the general rule is that the offeror is not bound unless the terms of his offer are complied with.

Acceptance by silence

●The general rule is that acceptance of an offer will not be implied from mere silence on the part of the offeree and that an offeror cannot impose a contractual obligation upon the offeree by stating that, unless the later expressly rejects the offer, he will be held to have accepted it.

●However, silence can be acceptance if the parties have previously agreed that silence constitutes

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acceptance or if, by their previous conduct, the parties have impliedly agreed to silence as acceptance. Previous conduct of the parties is the most common grounds upon which silence is alleged to constitute acceptance.

中国合同法做了类似规定：但是如果按照惯例沉默也可构成承诺。

Case

●Con, A Sharp operator, mail out 100 letter to sell his widget, which warns ― no reply, assume acceptance, and envelope enclosed‖ ●The receiver’s reaction: 90 7 3

Silence can be acceptance

For the past 4 years a tobacco farmer has been buying two or three tobacco flues each year from Miller Supply. Several flues arrive unsolicited in early October, and the farmer has been paying for the flues he keeps and returning the unwanted flues by Thanksgiving Day. This year the farmer waited until Christmas to return the flues he didn’t want. His unusual silence constitutes an acceptance since he had a duty to speak earlier, based on the history of dealings between himself and Miller Supply.

When does the acceptance take effect?

●In common law legal system---- postal rule (投邮生效）mailbox rule: The acceptance takes effect when it is sent no matter whether the mail is lost in transit. Eg: telegraph mail ●In civil law legal system---- rule of arrival (到达生效） The acceptance takes effect only after it reaches the offeror.

Withdraw of the acceptance

●In civil law legal system or in CISG

●An acceptance can be withdrawn before it reaches the offeror. The notification of withdraw must reach the offeror before or at the same time as the acceptance would have become effective. How about in common law system?

Late acceptance

●迟到的承诺：A late acceptance is generally ineffective. However, it is nevertheless effective as an acceptance if without delay the offeror orally so informs the offeree or dispatches a notice to that effect.

●承诺延误:If a letter or other writing containing a late acceptance shows that it has been sent in such circumstances that if its transmission had been normal it would have reached the offeror in due time, the late acceptance is effective as an acceptance unless, without delay, the offeror orally informs the offeree that he considers his offer as having lapsed or dispatches a notice to that effect. Thank u for ur listening

LECTURE5 Consideration （约因或对价 ）

Consideration is a complex term in common law. While in civil law system or CISG and PICC, there is no requirement of consideration to constitute a contract.

●In common law, consideration is necessary for the validity of every contract not under seal. A promise without consideration is a gift; one made for consideration is a bargain. And the promisee can not enforce a gift in the court.

●约因是英美法中一个重要而且复杂的概念。对确定一个合约是否有效，包括商贸活动中常有的事后更改合约(variation)，追加协议（additional agreement), 和解协议等是否有效，非常重要。 ●英国法律认为约因是―订约双方愿意去受法律约束的唯一证据‖ ( only evidence of the intention

●

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of the parties to be bound )

What’s consideration

●The classic definition set down by Lush J in Currie v Misa (1875) is as follows: [A valuable consideration, in the sense of the law, may consist either in some right, interest, profit or benefit accruing to the one party, or some forbearance, detriment, loss or responsibility given, suffered or undertaken by the other.]

●约因要有价值，一般最常见的是金钱。但也可以是其他的形式，如权益的放弃，提供服务或消息，修改原先合约，以后的生意，及可以想象到的―好处‖。

Definition and Requirement of Consideration

●Early theories described consideration as a benefit received by the promisor or a detriment incurred by the promisee.

Limitation: The definition makes no mention of why the promisee incurs a detriment or confers a benefit, or that the element of a bargain is central to the classical notion of consideration. Combe v Combe (1951)

●Today consideration is defined as ―a legal value, bargained for or given in exchange the other’s promise‖.

A promise is supported by consideration if two requirements are met: 1.promisee’s legal detriment ( provided in two ways) 2. promisor made his promise as part of bargain

Each party in contract is required to furnish consideration to the other. This is called the requirement of ―mutuality of consideration‖

The concept of consideration

A legally valuable promise, act, forbearance

↓

Bargained for and given in exchange for

↓

A legally valuable promise, act, forbearance

How to determine whether consideration has been given in a case? Ask yourself:

1.Which promise is at issue?

2. Who is the promisee of the promise?

3. Has the promisee given the consideration?

Gratuitous promises

●A promise to bestow a gift, i.e. free or donative promises, is unenforceable. Uncle---nephew $5000. drinking

Exceptions: promissory estoppel;charitable Subscriptions

Illusory promises

●If the terms of the contract express such uncertainty of performance that the promisor has not definitely to do anything, the promise is said to be illusory---without consideration and unenforceable

manager says to employees, ―10% bonus, if management thinks it is warranted‖

Option-to cancel clauses

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Valid consideration

●Consideration must be sufficient but need not be adequate. ●Not past Consideration

●Not preexisting duty (exceptions: unforeseeable difficulties; Rescission and new agreement for sale of goods under UCC)

●Consideration must move from the promisee (1861), which will not apply due to Contract (Right of Third party) Act 1999

Adequacy of Consideration General Rule:

The first rule of the doctrine of consideration is that consideration must be sufficient but it need not be adequate.

It means that as long as the promisee’s act or promise satisfies the legal value test, the courts do not ask whether that act or promise was worth what the promisor gave, or promised to give, in return for it.

Case: HongKong International Arbitration Center

Trivial acts

The maxim that consideration must be sufficient but need not be adequate has resulted in very trivial acts being held to constitute consideration. The classic illustration is Chappell Co. v. Nestle [1960]

Nestle offered for sale gramophone records in return for 1s 6d and three wrappers from their chocolate bars. The House of Lord held that the wrappers themselves, although of very trivial economic value, were nevertheless part of the consideration. This was so even though Nestle threw away the wrappers.

Consideration needn’t adequacy, but an agreement by which the parties exchange the same type of consideration, but in different amounts can be unenforceable.

Example

1. Mary sell her niece $5000 car for $5.

2.Mary want to make an enforceable future gift to her niece, and promises in writing ―to pay $5000 in consideration of the payment $5, receipt is hereby acknowledged from my niece.‖

Which is enforceable?

Nominal consideration

●Although not unanimous, Today Prevailing view is that Nominal consideration cannot make donative promise enforceable ●中国隐藏的意思表示

●Additionally, in cases in which the consideration is grossly inadequate, the courts may declare the contract unenforceable on ground that it is unconscionable.

Moral obligation Case: White v. Bluett

A son promised not to bore his father with complaints about the father’s distribution of his property among his children was held not to be good consideration for the father’s promise not to sue the son.

http://en.wikipedia.org/wiki/White_v_Bluett

The opposite case: Hamer v. Sidway: an uncle promised to pay his nephew 5000 if the nephew refrained from drinking liquor, using tobacco, swearing and playing cards until he was 21. This promise was held to be enforceable because the nephew had a legal right to engage in such activities, and in giving up his rights he had provided consideration for the promise.

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Preexisting Legal Duties

1) The question whether performance of a duty which one is already under an obligation to perform can constitute consideration for a promise given in return is currently a very controversial one in English contract law.

2) The orthodox position is clear: performance of an existing duty imposed by law does not constitute consideration.

3) case: Ward v. Byham. The father of an illegitimate child promised to pay the mother of the child 1 pound per week provided that the child was well looked after and happy. The mother was under a legal duty to look after the child. The mother sued the father when he stopped making the payments. The father argued that the mother had not provided any consideration for his promise.

Performance of an existing contractual duty owed to a promisor was no consideration for fresh promise given by that promisor.

Case: Stilk v. Myrick (1809)

Stilk was a seaman who agreed with the defendants to sail to the Baltic and back at a rate of pay of 5 pound per month. Originally, there were eleven men in the crew, but two men deserted during the voyage. The master was unable to find replacements for the deserters and so he agreed with the remainder of the crew that he would share the wages of the two deserters between them if they would work the ship back to London. The crew members agreed. When they returned to London, Stilk demanded his share of the money but the master refused to pay. Stilk sued for the money. He was unsuccessful in his claim.

Williams v. Roffey Bros &Nicholls Ltd

The defendant contractors entered into a contract to refurbish a block of flats. They sub-contracted the carpentry work to the claimant for price of 2000 pound. The claimant ran into financial difficulties after having completed part of the work. The cause of his difficulties was partly attributable to the fact that he had underpriced the job and partly because of his own inability to supervise his workforce. It was in the interest of the defendants to ensure that the claimant completed the work on time because if, as a result of delay or non-performance by the claimant, the defendants were late in completing the work and they would incur liability to their employers. So the defendants agreed to pay an extra 10300 to ensure that the work was completed on time. The claimant subsequently finished eight more flats but defendant only paid 1500. The claimant sued to the court. The court of Appeal adopted a very pragmatic approach to the issue. They held that the defendants had obtained a practical benefit as a result of the claimant’s promise to continue the job. This is sufficient to constitute a consideration. Compromise and forbearance to sue

A promise not to enforce a valid claim is good consideration for a promise given in return, as is a promise not to enforce a claim which is doubtful in law. On the other hand, it is clear that a promise not to enforce a claim which is known to be invalid is not good consideration for a promise given in return.

Fiege v. Boehm: 私生子案件

Cook v. Wright

The claimants honestly believed that the defendant was under a statutory obligation to reimburse them in respect of certain expenditure which they had incurred in work on a street adjoining the house in which the defendant was residing. The defendant denied that he was under such an obligation, but he eventually promised to pay a reduced sum after he was threatened with litigation if he did not pay. When he discovered that he was not in fact under a statutory obligation to pay, he refused to honor his promise. He maintained that his promise was not supported by consideration. But the court held that the promise was supported by consideration.

Past Consideration

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General Rule:

●The second rule is that past consideration is not good consideration 已过时的约因 （past consideration )

已发生的约因，因为不再具有价值，而不构成法律上承认的约因。

Eastwood v. Kenyon (1849) : The guardian of a young girl raised a loan to educate the girl and to improve her marriage prospects. After her marriage, her husband promised to pay off the loan. It was held that the guardian was unable to enforce this promise because the consideration which he had provided, which was bringing up and financing the girl, was past.

Debt satisfaction 债务清偿

In satisfying a liquidated(已清算确定） debt already due, any payment less than the amount of debt will not discharge the debt. There is no consideration in a agreement allowing partial payment substitute full payment. Some states have validated written settlement agreements for a lesser amount.

An agreement for any consideration paid to satisfy an unliquidated（未清算确定）, or disputed, debt is full payment and satisfaction.

Pinnel’s Case 1602

is an important case on the doctrine of part performance. In it, English Lord Coke opined that ―payment of a lesser sum cannot be any satisfaction for the whole, because it appears to the Judges that by no possibility, a lesser sum can be a satisfaction to the plaintiff for a greater sum: but the gift of a horse, hawk, or robe, etc. in satisfaction is good... [as] more beneficial to the plaintiff than the money.‖

Example

A owes B $6OO, owes Dr C $500 for a medical bill. A disputes C no greater $than 300. C insists on $500.

Suppose : A gets B to agree to accept to 350 in full payment and Dr. C to take $400 in full payment. Question: which debt is full satisfied? Who can sue the balance of debt later? why?

Composition agreement

Composition agreement is one between a debtor and two or more of his creditors who agree to take a sum less than the whole amount of their claims to be distributed, pro rata to joining creditors, in full satisfaction of debts. This agreement can extinguish the full debts.

Example

Danny is hard-pressed and has but only $6000 available to pay his creditors, X(2000),Y(12000),and Z(6000). He agrees to give the entire amount to then in settlement of all their claims totaling $20000. X refuse. Y agrees and gets $4000, Z agrees and gets $2000. Later, Danny gets legacy . Who can sue for balance.

Accord and satisfaction

Give substituted performance in satisfaction of an existing legal duty

Consideration must move from the promisee General Rule 也可引申为合同相对性原则

It means that a person to whom a promise is made can only enforce the promise if he himself provides consideration for that promise.

Q: When A makes a promise to B which is for the benefit of C. Can C sue A if A fails to confer the promised benefit on C?

Traditional, common law system countries would not allow C to sue A according to the principle of privity. But some new laws have been enacted to protect the third party’s right. e.g. Contracts (Rights of Third Party) Act 1999 of U.K.

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1968年白斯韦克夫人诉小白斯韦克案中，某煤炭商与其侄子订立了一项书面合同。根据该合同煤炭商将其企业卖给其侄子，而其侄子则答应在煤炭商死后每周向其寡妻支付5镑。但当该煤炭商死后，其侄子拒绝履约，并因此受诉。法庭裁定，原告作为死者的遗产管理人有权得到此款；但由于她不是该合同当事人，故不能以其个人名义诉请该合同强制执行。

Question

Colin made the following promises: (a) to give his daughter, Diana, ￡500 if she will abandon her career as a photographic model and become a social worker.

(b) to pay his secretary, Enid, ￡250 for having been willing to give up her lunch hour when necessary during the previous three months.

(c) to pay Fred, who has a contract with the local newsagent to deliver the newspapers in that area, ￡10 if he delivers the newspaper by 8 a.m. every day for a month and puts it through a letterbox without tearing it.

(d) to give his old lawnmower to George, a neighbour, if George collects it from the garden shed. Advise Colin to what extent, if at all, the above promises are legally binding on him.

Answer Analysis

(a) If D becomes a social worker C is prima facie bound.

C can escape liability by arguing no intention to create legal relations. Balfour v Balfour Jones v Padavattan

(b) Past consideration is no consideration Roscorla v Thomas, Re M c Ardle . Exceptions:

Lampleigh v Braithwaite Re Casey's Patents Pau on v Lau Yiu Long

(c) Third party obligations cases, and Contracts (Rights of Third Parties Act) 1999 .

(d) Illustrates difference between consideration and a condition. No contract exists between Colin and George. No consideration. It is a conditional gift. Wyatt v Kreglinger .

1. Explain what is meant by ―valuable consideration‖ in the law of contract.

2. Jack, the proprietor of Slick taxis, was alarmed at the slump in takings. After investigation he discovered that a major cause of this was that Fred, whom he employed as a taxi-driver, was offensive to potential customers and showed indifference and lack of co-operation in carrying out his duties. In order to remedy the position, Jack promised Fred, that if he would treat his customers with courtesy and encourage business, he would pay him a bonus on the additional takings. This would be paid at the end of the financial year. He also promised to increase the bonus if, during his own time, Fred would be responsible for keeping his taxi clean. Fred's conduct has from the time of this promise been exemplary and he has kept the taxi clean, but now, after the financial year has ended, jack is refusing to pay the bonus. Advise Fred.

3. Nut, who lived in Nottingham, learnt that his mother was ill in a hospital in London. He promised a friend, Bolt, that if he (Bolt) would drive him to London immediately, he (Nut) would pay him ￡50 on their return. Bolt agreed.

At the hospital Nut demanded of Slash, the surgeon, that his mother should be operated on at once. After the operation Nut promised Slash ￡100 for his trouble.

Nut could not afford to pay both Bolt and Slash, so asked Bolt if he would accept a cheque for ￡30 drawn on a London bank in full settlement. Bolt agreed and cashed the cheque. However, Bolt is now

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claiming a further ￡20 from Nut. Slash, who has not been paid by Nut, is suing him for the ￡100. Advise Nut

LECTURE6 Third parties

Consideration must move from the promisee General Rule 也可引申为合同相对性原则

It means that a person to whom a promise is made can only enforce the promise if he himself provides consideration for that promise.

Q: When A makes a promise to B which is for the benefit of C. Can C sue A if A fails to confer the promised benefit on C?

Traditional, common law system countries would not allow C to sue A according to the principle of privity. But some new laws have been enacted to protect the third party’s right. e.g. Contracts (Rights of Third Party) Act 1999 of U.K.

BESWICK v BESWICK 1968

1968年白斯韦克夫人诉小白斯韦克案中，某煤炭商与其侄子订立了一项书面合同。根据该合同煤炭商将其企业卖给其侄子，而其侄子则答应在煤炭商死后每周向其寡妻支付5镑。但当该煤炭商死后，其侄子拒绝履约，并因此受诉。法庭裁定，原告作为死者的遗产管理人有权得到此款；但由于她不是该合同当事人，故不能以其个人名义诉请该合同强制执行。 ●在英国法中，并没有承认利他合同的一般规则，但在司法实践中，利他合同的效力受到广泛的重视，并以判例的形式得到确认。在立法上，1996年，英格兰和威尔士法律委员会提出《合同法〈第三人保护〉》的议案草案，并于1999年在英国议会通过，利他合同获得了立法上的依据。其理论依据为―法定允诺说‖，即通过法律拟制来认可（被允诺人）债权人之外的第三人也享有诉权。

●在美国法中，纽约上诉法院在1859年劳伦斯诉福克斯一案中即已承认第三人诉权，并在以后的波尔诉比尔、塞瓦诉兰萨姆等案例中得到进一步确认。1932年的美国《第一次合同法重述》和1980年的《第二次合同法重述》对利他合同制度加以完善和发展，扩大了受益第三人的范围，使利他合同得以在更广的范围上予以适用。（7）

中国合同法关于第三人权利

第六十四条当事人约定由债务人向第三人履行债务的，债务人未向第三人履行债务或者履行债务不符合约定，应当向债权人承担违约责任。

Article 64 Performance toward a Third Person Where the parties prescribed that the obligor render performance to a third person, if the obligor fails to render its performance to the third person, or rendered non-conforming performance, it shall be liable to the obligee for breach of contract.

第六十五条当事人约定由第三人向债权人履行债务的，第三人不履行债务或者履行债务不符合约定，债务人应当向债权人承担违约责任。

Article 65 Performance by a Third Person Where the parties prescribed that a third person render performance to the obligee, if the third person fails to perform or rendered non-conforming performance, the obligor shall be liable to the obligee for breach of contract.

Assignment of Rights; Exceptions第七十九条债权人可以将合同的权利全部或者部分转让给第三人，但有下列情形之一的除外：

Article 79 The obligee may assign its rights under a contract in whole or in part to a third person, except where such assignment is prohibited: （一）根据合同性质不得转让； (i) in light of the nature of the contract; （二）按照当事人约定不得转让； (ii) by agreement between the parties; （三）依照法律规定不得转让。

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(iii) by law.

Assignment of rights 第八十条 债权人转让权利的，应当通知债务人。(无需经过债务人同意） Delegation of Obligations第八十四条 债务人将合同的义务全部或者部分转移给第三人的，应当经债权人同意。

Assignment of contract第八十八条 当事人一方经对方同意，可以将自己在合同中的权利和义务一并转让给第三人。

Third parties

Generally only those who are parties to the contract have rights under the contract．Two exceptions to this rule are third—party beneficiaries and assignees of contracts．

Example

Harry Mason agreed to construct a building for Taylor for a price．Taylor decided to breach the contract．Harry felt outrage but did not intend to sue for damages．Harry’s brother，John，did not want Taylor to get away with this and so sued Taylor for breach of the construction contract． Brother John is a stranger to the contract and cannot sue under it．John is not within the privacy(privity) of contract with Taylor；only Harry is.

THIRD PARTY BENEFICIARIES

An agreement entered into primarily and directly for the benefit of a third person is a third-party beneficiary contract．The designated third person can sue the promisor just as if such third party was a party to the contract．The test is whether the contracting parties intended to benefit a third party．One who is only accidentally or incidentally benefited is called an incidental beneficiary and cannot Sue．

Example---incidental beneficiary

Winthrop agrees to construct an office building for New Era. Towell has a vacant lot across the street from the construction site。Future office workers would need a close place to eat lunch，Towell，relying on the contract between Winthrop and New Era，constructs a restaurant, intending to cater to office workers. New Era breaches the contract with Winthrop. No office building is built. Towell will suffer a loss but cannot sue New Era for its breach of the contract, as Towell is only an incidental beneficiary who cannot sue on the contract between Winthrop and New Era．

●Third party beneficiaries fall into two classes：donee beneficiaries and creditor beneficiaries．

When one of the contracting parties intended to bestow a gift on a third person, a donee beneficiary contract is created．

On the other hand，if the contracting party obtains the promise of the other to perform the duty of the first party，a creditor beneficiary contract is formed

Example---sale of business

Newport owned a successful hardware store which was managed by Mark for many years. Newport contracted with a buyer to sell the going business for$80，000 cash，the buyer’s promise to pay the current creditors$10,000，and the buyer’s promise to retain Mark as manager for a period of 2 years at a salary of $25,000 a year．Newport’s creditors who are to be paid by the buyer are creditor beneficiaries who can sue the buyer. Mark was given the gift of the job by Newport．Mark is a donee beneficiary and can sue the buyer if the buyer should improperly discharge Mark as manager．

Creditor beneficiary

In a creditor beneficiary contract，the promisee obtains a promise by the promisor to carry out the promisee’s preexisting obligations. However，this contract does not excuse the promisee，the original

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debtor，from his or her debt or obligation．Instead，it provides the creditors with a new debtor in addition to the old one．However．if the creditor agreed to substitute the new debtor for the old one，a novation(a new contract)would discharge the old debt．

Example---withdrawal of partners

X，Y，and Z are partners．The firm has assets and liabilities．X decides to retire and wants her share of the partnership property．P offers to take X’s place with the approval of Y and Z．Y，Z，and P agree to pay all the old debts of the partnership and release X．This is a creditor beneficiary contract as regards the new partner P．P will now be liable to the old creditors of the firm，who are now creditor beneficiaries of the contract．X，however，is not released，and if she must pay the old creditors，she then could sue P，Y，and Z on their promise．If the old creditors had expressly agreed to release X in consideration of P’s promise to pay, a novation would have occurred and released X．

ASSIGNMENT 合同转让 权利让与

The transfer of a chose(right)in action is an assignment．The transferee is the assignee，and the transferor is the assignor．The party expected to pay is called the debtor or obligor．An assignment can be done orally unless there is a statutory requirement that it be in writing． ●Assignments are the foundation of much commercial financing.

Example

A seller delivers a machine to a buyer on credit. The buyer promises to pay $2,000 in 90 days． The buyer’s promise to pay is a chose （个人财产）in action owned by the seller．The seller needs cash and sells(transfers) this right to a finance company for $l,800．When the seller transfers this right. an assignment of the claim （权利） occurs，allowing the finance company to sue the buyer directly．

Duty delegated

Duties cannot be assigned，but many call be delegated. Where the duties of the promisee or

obligor would be changed in any material respect or enlarged thereby，the assignment and delegation would be ineffective．Further，where a contract calls for personal skill or judgment of one of the parties，all attempt to assign the contract is against public policy.

Example

Erica is an engineer who has superior writing skills．She is in demand by several technical publications．She is―overbooked，‖having signed contracts for more than she can handle. Her associate，Bill, is also an excellent writer. Erica assigns and delegates the duty in two of these contracts to Bill This is an invalid agreement. Authors’contracts generally involve personal skill One cannot effectively assign them where the right is only earned after performing personal duties．

Writing

The Statute of Frauds real property;

That could not be performed within a year; Collateral contracts;

Promises made in consideration of marriage;

for the sale of goods priced at $500 or more;(UCC)

the sale of stocks and bonds and agreements creating security interests

●Writing may be embodied in letters, memos, telegrams, invoices, and purchase orders sent between the parties; or any surface suitable for the purpose c of recording the intention of the parties

Example

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Danner orally sold his hunting lodge to Yorick, an old hunting buddy, for $5,000 The pair had a falling out, and Danner mailed a bitter letter to Yorick which ended ―I agreed to sell the lodge to you for$5,000, but everybody knows that since it is not in writing there is no deal.‖ This letter can bind Danner, but since Yorick did not sign it he cannot be bound, as it must be signed by the party charged.

Special rules involving written contracts the parol evidence rule and exceptions

prohibits any other written or oral evidence to vary, alter, or modify any term The best evidence rule

A written instrument is regarded as the primary OR best possible evidence, The equal dignities rule:

when a party a: appoints an agent to negotiate an agreement that must be in writing, the appointment n of t the agent must also be in writing

INTERPRETATION AND CONSTRUCTION

(1) When possible, the court will attempt to uphold the contract rather than render it void. (2) When there is more than one writing, the court will attempt to construe them together.

(3) Doubtful or ambiguous language is to be construed against the party who drew the contract or chose the language.

(4) Words and phrases are to be given their normal meaning

(5) Where a contract is partly written and partly printed, the writing controls. (6) Typewriting will prevail over printing, and handwriting over typewriting.

LECTURE7 Vitiating factors of contract

Vitiating factors of contract

●The fact that a contract has all necessary requirements (offer, acceptance, consideration, and intention) of valid formation does not mean that the contract is perfect. A contract may still be unenforceable because of other defects, vitiating factors, which may invalidate the contract. ●Vitiating factors include: 1.incapacity of parties 2.unreality of consent 3.illegality of contract.

■Capacity

■Reality of consent ■Legality of contract

Capacity of Parties

Capacity means the ability to incur legal obligations and acquire legal rights. Today, the primary classes of people who are considered to lack capacity are minors, persons suffering from mental illnesses or defects, and intoxicated persons.

Effect of Lack of Capacity

Normally, a contract in which one or both parties lack capacity because of infancy, mental impairment, or intoxication is considered to be avoidable.

Capacity of Minors

●A minor is a person under the age of 18. The general rule is that minors may disaffirm their contracts at any time during their minority and for a reasonable time after attaining majority.

●The exercise of this right to avoid a contract is called disaffirmance. Only the minor or a legal representative such as a guardian may disaffirm the contract.

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In common law

●The general rule is that a minor is not bound by a contract which he enters into during his minority. But the rule is subject to some exceptions.

a. A contract to supply a minor with necessaries is binding upon the minor where the contract as a whole is for the benefit of the minor.

b. A minor is bound by a contract of employment if that contract is generally for his benefit.

c. Certain contracts with minors are not void but only voidable, that is, the contract is valid and binding upon the minor unless he repudiates liability before majority or within a reasonable time thereafter.

Exercise: Nash v. Inman

●A tailor sold 11 fancy waistcoats to a minor, who was Cambridge undergraduate. The minor refused to pay for them. The tailor sued to the court?

●If you were the judge, who would you support?

Capacity of Mentally Impaired Persons

●The contracts of people who are suffering from a mental defect at the time of contracting are usually considered to be avoidable. But the mental impaired person needs to prove his mental capacity was inferior when he made the decision.

Contracts of Intoxicated Persons ●Intoxication and Capacity

●Intoxication can deprive a person of capacity to contract. The mere fact that a party to a contract had been drinking when the contract was formed would not normally affect his capacity to contract. Intoxication is a ground for lack of capacity only when it is so extreme that the person is unable to understand the nature of the business at hand.

Capacity of civil conduct in China (中国对当事人能力的规定)

●民事行为能力是指民事法律关系主体通过自己的行为取得民事权利、承担民事义务的能力。 (1) full capacity: A citizen aged 18 or over shall be an adult. He shall have full capacity for civil conduct, may independently engage in civil activities and shall be called a person with full capacity for civil conduct.

A citizen who has reached the age of 16 but not the age of 18 and whose main source of income is his own labour shall be regarded as a person with full capacity for civil conduct.

(l)完全民事行为能力的人。十八周岁以上的公民是成年人，具有完全民事行为能力。对于十六周岁以上不满十八周岁的公民，如果是以自己的劳动收人为主要生活来源的，亦视为有完全民事行为能力的人。他们都可以独立进行民事活动，包括订立各种合同。

Limited capacity

●A minor aged 10 or over shall be a person with limited capacity for civil conduct and may engage in civil activities appropriate to his age and intellect; in other civil activities, he shall be represented by his agent ad litem (guardian) or participate with the consent of guardian.

A minor under the age of 10 shall be a person having no capacity for civil conduct and shall be represented in civil activities by guardian.

(2)限制民事行为能力的人。①十周岁以上的未成年人是限制民事行为能力人，他们可以进行与其年龄、智力相适应的民事活动；至于其他民事活动应由其法定代理人代理，或者征得其法定代理人的同意。②不能完全辨认自己行为的精神病人是限制民事行为能力人，他们可以进行与他的精神健康状况相适应的民事活动；其他民事活动由其法定代理人代理，或者征得其法定代理人的同意。

No capacity

●A mentally ill person who is unable to account for his own conduct shall be a person having no

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capacity for civil conduct and shall be represented in civil activities by his guardian.

A mentally ill person who is unable to fully account for his own conduct shall be a person with limited capacity for civil conduct and may engage in civil activities appropriate to his mental health; in other civil activities, he shall be represented by his agent ad litem or participate with the consent of his guardian.

(3)无民事行为能力的人。无民事行为能力人包括：①不满十周岁的未成年人；②不能辨认自己行为的精神病人。无民事行为能力人不能实施有效的法律行为，他们签订的合同是无效的。 比较

●英美法中未成年订立合同多数是 voidable contract，未成年人在成年之前可任意撤销，成年后合理时间内可以撤销(disaffirmation)或者追认(ratification).撤销前合同是有效的。相对人无权撤销，若未成年构成侵权，可要求赔偿

●中国 未成年人订立合同多数是效力待定合同 Effectiveness-pending contract. 是否已经发生效力尚不能确定，有待于其监护人追认，善意相对人可以撤销和催告。

中国合同法其他影响合同效力的因素

1.重大误解 substantial misunderstanding ----- voidable 2.胁迫 duress ----- voidable or void 3.欺诈 fraud ----- voidable or void

4.显失公平 obviously unfair ----- voidable or void

5.以合法形式掩盖非法目的conceal an illegal purpose under the guise of a legitimate transaction ----- void

6. 恶意串通，损害国家、集体或他人利益的colluded in bad faith, thereby harming the interests of the state, the collective or any third party ----- void 7. 违法 illegality ----- void

Reality of consent in common law

●Every contract must have mutual consent．This consent must be voluntary，which is examined under the subject called reality of consent．

●Reality of consent is questioned on the following grounds： 1.fraud，

2.misrepresentation， 3.mistake， 4.duress，

5.undue influence，

6.unconscionability. under the UCC

Example

A seller agreed in writing，before witnesses，to sell his land to the buyer．In fact the document expressly provided that ― This contract is signed freely without fraud，disability, or under duress, or any other ground.‖ The seller now contends that he was threatened with exposure of his criminal past by the buyer unless he signed．The buyer maintains that the seller ―agreed.‖The seller can offer oral testimony that he signed without real consent，under duress，that his agreement was not voluntary．He would be allowed to disaffirm the contract on grounds of duress，i.e., lack of reality of consent．

Fraud

A contract can be avoided, or damages received, if it was induced by misrepresentation of a material fact by one party which was relied upon by the other to his or her injury or loss

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Requirements for Fraud:

1.there must be a false statement, active concealment, or silence when there is a duty to speak． 2.A material fact must be involved in the false statement. 3.There must be an intention to deceive.

4.The person deceived must have reasonably relied upon the other party to make an accurate statement or to make a complete disclosure．

5.This reasonable reliance must have resulted in an injury．

●英国法将欺诈作为错误陈述的一种情形加以规定。所谓错误陈述，是指―当事人在正式订约前，为引导订约而作出的与事实不相符合的事实陈述。‖依其对合同效力影响的不同，错误陈述分为欺诈性错误陈述（Fraudulent Misrepresentation）、过失性错误陈述（Negligent Misrepresentation）和无辜的错误陈述（Wholly Innocent Misrepresentation）。其中，欺诈性错误陈述为―误述人并非真诚相信其陈述是真实的，或者说他故意错误陈述。‖对于哪些错误陈述属于欺诈性的，英国法采用主观标准，即判断误述人是否明知其陈述的虚假性不是取决于正常人在合理条件下应该知悉，而是取决于误述人实际上如何理解其陈述。―上院在著名的德里诉皮克一案中断然决定：只有在知道它是虚假的或者粗心大意地在不知道或没有注意到是真是假时作出的陈述才是欺诈性的陈述。‖如果误述人的误述构成欺诈性错误陈述，则受害人有权提起如下诉讼请求或者采取如下措施：一、受害人如已遭受损失，可基于对方的侵权行为诉请侵权赔偿，同时还可以采取（二）和（三）两项中任一措施；二、受害人有权诉请撤销该合同；三、受害人有权拒绝履行该合同，在此种情况下，受害人可以不予起诉，但如果他受诉，则可以提出抗辩和反诉要求赔偿；四、受害人基于自己意愿有权确认该合同，要求其履行而不考虑其中误述因素。

●美国法将欺诈和错误陈述区别开来。―欺诈是有意地歪曲事实，取得另一方的信任，从而使另一方放弃为其所有的某些有价值的东西或放弃某种法律上的权利。‖它与错误陈述的最大区别就在于前者是故意为不真实的表示，而后者是非故意的，是无辜的。欺诈的构成要件包括：（一）欺诈人有非法获取受欺诈人的合法权益的动机；（二）欺诈人对事实做了虚假的说明；（三）受欺诈人基于对该陈述的信赖而采取了行为；（四）此种虚假说明使受欺诈人蒙受损害。根据法律规定，欺诈通常只限于事实问题，发表意见或者吹嘘可能不真实，但不构成欺诈。陈述当事人并不存在的意图属于欺诈，但之后改变其意志并且未能按被期待的效果行事，则不属于欺诈。关于法律后果的陈述亦不属于欺诈，除非当事人之间存在特殊关系。对于基于欺诈而订立的合同，受欺诈人可以采取如下补救措施：（一）恢复原状。这是一种对撤销合同的救济措施，它使当事人恢复到订立合同前的地位。具体后果是：已交付财物的，当事人互相返还；还有义务尚未履行的，解除履行义务。（二）更改，即合同仍存在，但是改变其有关条款。（三）损害赔偿。它适用于当事人有过错的情形，但因过错的程度其适用有所不同。在欺诈的情形下，法院可能给予惩罚性损害赔偿，其数额甚至可达补偿性损害赔偿金的数倍。

Misrepresentation

A falsely made statement of material fact, not opinion (Bisset v.Wikinson), nor future intention (Edigington v fitamaurice), nor trade puffs (Carlill v Carbolic Smoke Ball Co.)

Bisset v.Wikinson

Mr Wilkinson and Mr Bisset entered into a contract in May, 1919, whereby Mr Bisset would purchase two adjoining blocks of land called Homestead and Hogan’s, in Avondale, New Zealand.[2] The two blocks comprised of 2062 and 348 acres respectively, the two parties reaching agreement, for 13,260l. During negotiations Mr Wilkinson stated that he believed the land would hold 2000 sheep, if cultivated and used correctly. Subsequently, it was discovered the land did not hold 2000 sheep, and the claimant brought an action for misrepresentation.[3]

●当事人对某个事项或者事物发表的一般性意见，不构成虚假陈述，因为这个意见是主观的，而不是客观存在的，不一定会成为事实

●This result can be contrasted with other situations where one party has specialist knowledge of the

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subject, as in Esso Petroleum Co Ltd v Mardon

Esso Petroleum Co Ltd v Mardon

●Mr Mardon was buying a petrol station, franchised by Esso Petroleum Co Ltd. Esso told him they had estimated that the throughput of a petrol station in Eastbank Street, Southport, would be 200,000 gallons a year. However the local council made a decision on planning permission so there would be no direct access from the main street. That meant fewer customers. But Esso still told Mr Mardon the estimated throughput was 200,000. Mr Mardon bought the petrol station and business did not go well. From 1964, Mr Mardon negotiated a lower rent with Esso. He still put money in but lost a lot. Esso then brought an action for possession against Mr Mardon. He counterclaimed for damages of Esso’s breach of warranty or negligence under Hedley Byrne.

Esso Petroleum Co Ltd v Mardon当事人对自己未来的行为或者意图所做的陈述，只是说明他将来会怎么做，例如在今后5年里的投资将达到一定的水平等，一般不会构成虚假陈述，因为这种意图只是对未来行为的一种想法，显然并非事实，因此不构成虚假陈述。

Esso Petroleum Co Ltd v Mardon但是当事人如果故意说假话，则有可能构成欺诈性故意陈述。如案例Edigington v fitamaurice

Edigington v fitamaurice

被告是一家公司董事，该公司无力偿还欠债，准备通过发行证券向社会筹集资金。公司在招股说明书说资金将用于扩展公司业务和改善公司建筑，但其真实意图是用于清偿债务。被告于是购买1500磅的债券，后得知真实意图，且公司破产，原告起诉，初审败诉，上诉审原告胜诉。

Innocent misrepresentation

Not all conduct involving an untruth is fraudulent. but the law nevertheless provides a remedy in the action for innocent misrepresentation．Innocent misrepresentation of a material fact relied upon by the other party to his or her injury permits an action for rescission of the contract．

Unlike fraud，an action for innocent misrepresentation only allows the other party to rescind the contract. It does not provide for money damages．

Example

Linda wants a fast sports car．She understands that the seller has a car that has broken several speed records The seller acknowledges that this is true and to push the sale states that ― this little baby has moved 132 miles per hour on six occasions‖ Linda is impressed with that statement and buys the car．Unknown to the seller，the speedometers on those models are defective and overstate the speed by 10 miles per hour．The car cannot go 132 miles per hour and never did．This is an innocent misrepresentation．The seller misstated the facts．Had he only reported what he saw. i.e., the speedometer showing a speed of 132 miles per hour，he would have been making a true statement．

Mistake

●A mistake is a belief about a fact that is not in accord with the truth. The mistake must relate to facts as they exist at the time the contract is created.

●There are two kinds of mistakes alleged in lawsuits: unilateral and mutual mistakes.

●Generally unilateral mistakes of material fact do not permit avoidance unless the other party knew or should have known that a mistake was being made.

●A mutual mistake permits recission of the contract and occurs when the parties use language capable of several meanings and each has taken a different meaning,, or in instances when the parties are in error about the existence of subject matter of the contract.

Duress

●Duress is wrongful coercion that induces a person to enter or modify a contract. One kind of duress is physical compulsion to enter a contract. A far more common type of duress occurs when a person is

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induced to enter a contract by a threat of physical, emotional, or economic harm. In these cases, the contract is considered avoidable at the option of the victimized person. ●Requirements for Duress

To rescind a contract because of duress, one must be able to establish both of the following elements: 1. The contract was induced by an improper threat.

2. The victim had no reasonable alternative but to enter the contract.

胁迫的案例

在1915年马斯金尔诉豪纳案中，被告拥有一市场，他向原告征收营业地皮费。因原告拒付，被告扣押了其货物；后来原告被迫给付并声称以后每年都付费。此后因被告收费权被宣布为非法，原告起诉。法庭裁定，原告给付订约是基于对方胁迫而做出的，故可诉请返还。

Economic Duress

? The doctrine of duress is often applied in a business context. Economic duress, or business compulsion, are terms commonly used to describe situations in which one person induces the formation or modification of a contract by threatening another person’s economic interests.

经济胁迫的案例

例如在1983年宇宙卫士海运股份公司诉国际运输工人联合会案中，原告是利比里亚一海运公司，其公司全部股东均住在美国，该公司的宇宙卫士号货船(悬挂利比里亚国旗)从利比里亚载物准时运达英国明福特哈温港。该船船员主要为亚洲人，由于他们的工资水平按照国际运输工人联合会的规定过低，故该联合会号召工人拒绝为该船卸货，使之不能离港。该联合会声明，除非原告公司捐助80万美元作为海员国际福利基金，否则不予卸货，原告公司被迫给付捐款后起诉追偿。法庭裁定，这一支付是在经济胁迫下做出的；并且按照有关工业法规，此类给付要求也并不合法；故原告有权追回付款

对胁迫合同的处理

在基于胁迫而订立的合同中，受胁迫、方当事人有撤约选择权；如果胁迫构成违法，受害人还有权诉请侵权赔偿。

Undue Influence

●Undue influence is unfair persuasion. Like duress, undue influence involves wrongful pressure exerted on a person during the bargaining process. In undue influence, however, the pressure is exerted through persuasion rather than through coercion. The doctrine of undue influence was developed to give relief to persons who are unfairly persuaded to enter a contract while in a position of weakness that makes them particularly vulnerable to being preyed upon by those they trust or fear. ●Undue influence cases normally involve both of the following elements:

1 The relationship between the parties is either one of trust and confidence or one in which the person exercising the persuasion dominates the person being persuaded. 2 The persuasion is unfair.

Two different types of undue influence (1) presumed undue influence

●The following relationships are presumed to be fiduciary relationship: parent and child; trustee and beneficiary; doctor and patient; solicitor and client; guardian and ward

●When these relationships exist, the party with weak bargain power can resort to the court for contract cancellation.

(2) actual undue influence

●When the fiduciary relationship is absent, the plaintiff can prove that the defendant has exerted undue influence.

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推定非适当影响案例

在1971年赫金森诉马克斯案中，某老年寡妇(原告)拥有一项房产，她的房客百般讨好她，而她放心地信任他，该房客实际上成了她的事务总管。后来原告为防止其侄赶走该房客，竟将该房产出让给他。双方履行过户登记手续后口头约定，原告在世时仍具有该房产之所有权。此后该房客将房子转卖给第三人，买主对这些事实不详。后原告诉请买主返还．法庭裁定，由于上述房客已取得原告的特别信任，因此应推定合同建立在非适当影响的基础上；其次，尽管本案买主真诚订约，但他已经知悉原告对房产的实际占有情况，因此原告胜诉

实际的非适当影响案例

Commercial Bank of Australia Ltd v. Amadio

被告为一无商业经验的农民，他的儿子在原告公司的地方分行透支。他为此向原告公司请求帮助，而原告公司经理则说服他以仅有的住房设做抵押为其儿子出保。后原告公司因履行抵押受阻而起诉。法庭裁定，被告基于信赖原告而听取其建议；原告银行经理却违反受托人的应有注意，没有提醒对方应听取独立的法律咨询；因此本案合同基于非适当影响而订立，被告方有权撤约。

Illegality

?Illegal agreements will be classified into three main categories: (1) agreements that violate statutes, (2) agreements that violate public policy developed by courts, and (3) unconscionable agreements and contracts of adhesion.

?A standard form contract prepared by one party and presented to another party， usually a consumer. These contracts are offered on a \， providing the consumer no opportunity to negotiate the terms. For example， all the small print on the back of an airline ticket constitutes an adhesion contract because you don,t even see it until after you,ve bought the ticket.

非法合同的含义

非法合同是指与法律、公共政策相抵触的无效合同。 (1)合同的订立程序非法; (2)合同的履行内容非法； (3)合同的对价非法； (4)订约目的非法。

非法合同的基本类型 (一)危害公共服务的合同

危害公共服务的合同是指可能将违反普通法中的公共政策原则的合同；

例如在1925年帕金森诉安布兰斯学会案中，被告协会的代表向原告诉诺：如果原告向其学会捐赠一笔钱，他就能得到爵士头衔。后原告因未能取得该头衔而诉请收回捐款，法院判决原告败诉，因为该合同属于违反公共政策的非法合同

妨碍司法权行使的合同

1．妨碍刑事诉讼和破产程序的合同

妨碍对犯罪行为进行刑事追诉的协议属于非法无效合同，因为此类合同明显有碍于公共利益。

2．非法的助讼帮诉合同

非法助讼是指―无正当原因和理由而不适当地资助诉讼一方当事人起诉或反诉，恶意地挑起诉讼纠纷。‖而帮诉则是指帮诉人非法向诉讼一方当事人提供证据或资助，从而收取胜诉收益的协议

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3．限制证人提证的合同 (三) 与敌对国通商的合同

除经国王特许外，凡与战时自愿居住于敌国的人订立的一切合同均属于非法无效合同。 (四) 以实施犯罪或侵权行为为内容的合同 (五) 不道德的合同

(六)妨碍婚姻自由的合同

(七)其它与公共政策相抵触的合同 (八)赌博合同

(九)限制性贸易合同和转售价格维持合同 (十)限制营业合同

LECTURE8 Performance of the Contract in China’s contract law &CISG

Performance of the Contract

●When parties enter into a contract, they generally do so in the expectation that it will be performed according to its terms.

●合同的履行，是指合同生效后，合同当事人按照合同的约定，实施属于合同标的的行为，如交付约定的标的物、提供约定的服务，支付约定的价金或者报酬。

The principles for performance合同履行的基本原则 1）fully perform 合同全面履行原则

《合同法》第60条第1款规定：―当事人应当按照约定全面履行自己的义务‖ The parties shall perform their obligations thoroughly according to the terms of the contract. 2）good faith 诚实信用的原则

第2款规定：―当事人应当遵循诚实信用原则，根据合同的性质、目的和交易习惯履行通知、协助、保密等义务。‖ The parties shall abide by the principle of good faith and perform the obligations of notice, assistance and maintaining confidentiality, etc. based on the character and purpose of the contract or the transaction practices.

生产线供应合同纠纷案：

●在一份关于供应和安装某一特殊生产线的合同中有这样一条规定：卖方A就该生产线的技术所做的任何改进，A均有义务告知买方B。一年后B了解到有一项重要的技术改进未得到A的通知。对此A以下列理由开脱：A不再负责这种特定型号生产线的生产，生产已转由A的全资附属公司C承担。A这样做违背了诚实信用的原则，因为A为了规避对于B的合同义务，特意设立了一个独立的实体C，由C来承担这种生产。 法院判决：

A应撤销C并赔偿B的损失。

Indeterminate Terms 合同约定不明的履行 （合同漏洞的补充） ●在个别情形下，由于某些当事人缺乏订立合同的常识或者疏忽大意等原因，有些必要的条款没有订立或者规定得含糊不清，由此产生合同漏洞。所谓合同漏洞，是指合同没有就当事人争议的事项作出明示的规定，因而依合同的明示条款无法确定涉及这一争议各方当事人的权利和义务。

案情介绍：

设在X国的A公司组织一次50周年庆典宴会。由于X国的烹饪水平很一般，该公司就从巴黎一家著名餐馆定餐。合同对餐食质量未有约定。在这种情况下，所供应食物的质量就不应低于巴黎餐馆的平均水准，如果只达到X国的平均水准，则显然是不合要求的。结果餐馆未能达到要求。

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法院判决：

餐馆应赔偿A公司的经济损失。

对合同漏洞进行补充的基本步骤 （1） If a term such as quality, price or remuneration, or place of performance etc. was not prescribed or clearly prescribed, after the contract has taken effect, the parties may supplement it through agreement 依当事人之间明示的协商进行补充。

（2） if the parties fail to reach a supplementary agreement, such term shall be determined in accordance with the relevant provisions of the contract or in accordance with the relevant usage如当事人不能达成协议的，则应当由法律推定其本来意思。

中国合同法的相关规定

●If the relevant terms of a contract are unclear, nor can it be determined according to the provisions of Article 61 of this Law, the provisions below shall be applied. (当事人就有关合同内容约定不明确，依照本法第六十一条的规定仍不能确定的，适用下列规定。)

(1) If quality requirements are unclear, the State standards or trade standards shall be applied; if there are no State standards or trade standards, generally held standards or specific standards in conformity with the purpose of the contract shall be applied. (质量要求不明确的，按照国家标准、行业标准履行；没有国家标准、行业标准的，按照通常标准或者符合合同目的的特定标准履行。)

(2) If the price or remuneration is unclear, the market price of the place of performance at the time concluding the contract shall be applied; if the government-fixed price or government-directed price shall be followed in accordance with the law, the provisions of the law shall be applied. 价款或者报酬不明确的，按照订立合同时履行地的市场价格履行；依法应当执行政府定价或者政府指导价的，按照规定履行。

(3) If the place of performance is unclear, and the payment is currency, the performance shall be effected at the place of location of the party receiving the payment; if real estate is to be delivered, the performance shall be effected at the place of location of the real estate; in case of other contract objects, the performance shall be effected at the place of location of the party fulfilling the obligations. (履行地点不明确，给付货币的，在接受货币一方所在地履行；交付不动产的，在不动产所在地履行；其他标的，在履行义务一方所在地履行.)

(4) If the time limit for performance is unclear, the obligor may at any time fulfill the obligations towards the obligee; the obligee may also demand at any time that the obligor performs the obligations, but a time period for necessary preparation shall be given to the obligor.(履行期限不明确的，债务人可以随时履行，债权人也可以随时要求履行，但应当给对方必要的准备时间。)

(5) If the method of performance is unclear, the method which is advantageous to realize the purpose of the contract shall be adopted. 履行方式不明确的，按照有利于实现合同目的的方式履行。 6) if the burden of the expenses of performance is unclear the cost shall be assumed by the obligor. 履行费用的负担不明确的，由履行义务一方负担。

Obligations of the seller under CISG

1. Delivery of the goods and handing over of documents

●If the contract involves carriage of the goods, the seller needs to hand over the goods to the first carrier;

●If no transportation is stated, and the contract relates to specific goods, or unidentified goods to be drawn from a specific stock or to be manufactured or produced, and at the time of the conclusion of the contract the parties knew that the goods were at, a particular place, in placing the goods at the buyer’s disposal at that place, the buyer fulfill his duty of delivery.

●In other cases, the seller places the goods at the buyer’s disposal at the place where the seller has his place of business at the time of the conclusion of the contract.

●The seller shall hand over documents relating to the goods at the time and place and in the form

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required by the contract.

Obligations of the seller under CISG

2. Conformity of the goods and third party claims

●The seller must deliver goods which are of quantity, quality and description required by the contract or packaged in the manner required by the contract.

3.The seller must deliver goods which are free from any right or claim of a third party, unless the buyer agreed to take the goods subject to that right or claim.

●The seller must deliver goods which are free from any right or claim of a third party based on industrial property or other intellectual property, of which are the time of the conclusion of the contract the seller knew or could not have even unaware.

Obligations of the Buyer under CISG 1. Payment of the price

The buyer must pay the price for the goods:

(1) at the place required by the contract; or if no place is specified, (a) at the seller’s place of business, or

(b) if the payment is to be made against the handing over of the goods or of documents, a the place where the handing over takes place. （１）如果买方没有义务在任何其它特定地点支付价款，他必须在以下地点向卖方支付价款：（ａ）卖方的营业地；或者（ｂ）如凭移交货物或单据支付价款，则为移交货物或单据的地点。

Obligations of the buyer under CISG

The buyer’s obligation to take delivery consists:

(1) in doing all the acts which could reasonably be expected of him in order to enable the seller to make delivery; and

(2) in taking over the goods.

Passing of risk under CISG

a. If the contract of sale involves carriage of the goods and the seller isn't bound t hand them over at a particular place, the risk passed to the buyer when the goods are handed over to the first carrier for transmission to the buyer in accordance with the contract of sale. If the seller is bound to hand the goods over to a carrier at a particular place, the risk does not pass to the buyer until the goods are handed over to the carrier at that place.

Nevertheless, the risk does not pass to the buyer until the goods are clearly identified to the contract, whether by markings on the goods, by shipping documents, by notice given to the buyer or otherwise.

（１）如果销售合同涉及到货物的运输，但卖方没有义务在某一特定地点交付货物，自货物按照销售合同交付给第一承运人以转交给买方时起，风险就移转到买方承担。如果卖方有义务在某一特定地点把货物交付给承运人，在货物于该地点交付给承运人以前，风险不移转到买方承担。卖方受权保留控制货物处置权的单据，并不影响风险的移转。

（２）但是，在货物以货物上加标记、或以装运单据、或向买方发出通知或其它方式清楚地注明有关合同以前，风险不移转到买方承担。

b. The risk in respect of goods sold in transit passes to the buyer from the time of the conclusion of the contract. But, if at the time of the conclusion of the contract of sale the seller knew or ought to have known that the goods have known that the goods had been lost or damaged and did not disclose this to the buyer, the loss or damage is at the risk of the seller.

c. in other cases, the risk passes to the buyer when he takes over the goods or, if he does not do so in due time, for the time when the goods are placed at his disposal.

对于在运输途中销售的货物，从订立合同时起，风险就移转到买方承担。但是，如果情况表明有此需要，从货物交付给签发载有运输合同单据的承运人时起，风险就由买方承担。尽管如此，

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如果卖方在订立合同时已知道或理应知道货物已经遗失或损坏，而他又不将这一事实告之买方，则这种遗失或损坏应由卖方负责。

在其他情况下，从买方接收货物时起，或如果买方不在适当时间内这样做，则从货物交给他处置但他不收取货物从而违反合同时起，风险移转到买方承担。

Special rights in performance—— right of defence 抗辩权 ●所谓抗辩权，是指用以对抗他人请求权或者否认他人权利主张的权利。双务合同履行中的抗辩权，是指在符合法定条件时，当事人一方对抗对方当事人的履行请求权，暂时拒绝履行其债务的权利。

(1) Simultaneous Performance rejection 同时履行抗辩权

(2) Rejection to perform by the party required to perform later 后履行抗辩权

(3) Right to Suspend Performance by the party required to perform first 先履行抗辩权，亦称不安抗辩权

Simultaneous Performance Rejection 同时履行抗辩权

●Where the parties owe performance toward each other and there is no order of performance, the parties shall perform simultaneously. Prior to performance by the other party, one party is entitled to reject its requirement for performance.

●同时履行抗辩权：是指双务合同的当事人一方，在对方未对待给付之前或者履行不适当时，有权拒绝自己的履行。 适用条件：

（1） 须由同一双务合同互负债务 （2） 须双方互负的债务均已届清偿期 （3） 须对方未履行或未适当履行债务

案情简介：甲与乙在2005年3月份签订一份合同，双方约定甲应于同年5月份向乙交付10台冰箱，乙应同时向甲交付价值5万元的制冷机。后来甲企业转产不从事冰箱行业，但由于过去业务上的来往欠丙借款5万元。于是与商场丙达成合意，由丙来接受乙交付的制冷机。甲丙达成协议后，甲就此事通知了乙，乙表示到时会将制冷机交给丙企业。同年5月份，乙已准备好应该交付给丙的制冷机，但甲却于此时未向乙提供冰箱。乙于是对丙表示，除非甲对其履行，否则他为避免风险不会对丙履行。丙此时才知道甲乙之间的关系，表示这与他无关，双方发生争议。在受到乙的抗辩后，丙找到甲向其要求要么马上向乙履行，要么返还欠款。甲不同意，主张合同已签订，不能反悔，只说尽快履行其对乙的债务。

Rejection to perform by the party required to perform later 后履行抗辩权

●Where the parties owe performance toward each other and there is an order of performance, prior to performance by the party required to perform first, the party who is to perform subsequently is entitled to reject its requirement for performance.

●是指在双务合同中应当先履行的一方当事人未履行或者不适当履行到履行期限的，对方当事人享有不履行或部分履行的权利。 适用条件：

第一，须由同一双务合同互负债务。 第二，须由一方当事人先为履行。

第三，先履行的一方不履行或不适当履行合同债务。

陶瓷买卖合同纠纷案：

●原告与被告签订陶瓷买卖合同，约定由原告先行给付10000元预付款，在被告将陶瓷运至原告处后支付剩余的30000元货款。合同签订后，被告在未将货物运送给原告之前，要求原告将货

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款支付完毕才发货。原告遂向人民法院起诉，要求被告严格履行合同。 ●审判理由及结果：

●法院经审理认为：该买卖合同之履行有先后之分，被告有先应履行之义务而不履行，反而要求有后履行义务一方先行履行其义务，是不合理的；原告行使其后履行抗辩权，是合理合法的，故判令被告应严格履行合同。

Right to Suspend Performance by the party required to perform first

●The party required to perform first may suspend its performance if it has conclusive evidence establishing that the other party is in any of the following circumstances:

●先履行抗辩权，亦称不安抗辩权，是指在双务合同成立后，应当先履行的当事人有证据证明对方不能履行义务，或者有不能履行合同义务的可能时，在对方没有履行或者提供担保之前，有权中止履行合同义务。 适用条件：

第一，须因双务合同互负债务

第二，须当事人约定一方应先履行债务。

第三，先履行的一方有确切的证据证明另一方不能或不会作出对待履行。 ●《合同法》第68条规定：―应当先履行债务的当事人，有确切证据证明对方有下列情形之一的，可以中止履行：

（一）经营状况严重恶化；

（二）转移财产、抽逃资金，以逃避债务； （三）丧失商业信誉；

（四）有丧失或者可能丧失履行债务能力的其他情形‖ (i) Its business has seriously deteriorated;

(ii) It has engaged in transfer of assets or withdrawal of funds for the purpose of evading debts; (iii) It has lost its business creditworthiness;

(iv) It is in any other circumstance which will or may cause it to lose its ability to perform.

陶瓷买卖合同纠纷案

●仍依前例。被告发现原告经营状况严重恶化，将可能没有能力支付剩余的30000元货款，故决定先不发货，要求被告提供相应的担保或者先将货款支付完毕才发货。原告遂向人民法院起诉，要求被告严格履行合同，先发货才向其提出支付剩余货款。 ●审判理由及结果：

法院经审理认为：该买卖合同之履行有先后之分，被告有先应履行之义务而不履行，反而要求有后履行义务一方先行履行其义务，是不合理的。但因其具有法定之事由，既经查明原告经营状况发生严重恶化的情形，被告行使其先履行抗辩权，即是合理合法的，故判令驳回原告的诉讼请求。

Special rights in performance: right of creditor (债权保全权，债权人的权利）

● 所谓债权人的债权保全权，是指债权人行使该项法律所规定的权利，为防止债务人的责任财产的不当减少，确保无特别担保的一般债权得以清偿；因其保全责任财产，最终使债权得以保障，因此称为债权人的债权保全权。

债权保全权 - Subrogation 代位权

●Where the obligor delayed in exercising its creditor's right against a third person that was due, thereby harming the obligee, the obligee may petition the People's Court for subrogation, except where such creditor's right is exclusively personal to the obligor.

●债权人的代位权是指当债务人怠于行使其对第三人的权利，听任责任财产减少害及债权人的债

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权时，债权人为保全其债权，以自己的名义向第三人行使债务人现有债权的权利。

●《合同法》第73条规定：因债务人怠于行使其到期债权，对债权人造成损害的，债权人可以向人民法院请求以自己的名义代位行使债务人的债权，但该债权专属于债务人自身的除外。

代位权行使的要件：

（1） 债权人对债务人的债权必须合法、确定，且必须已届清偿期。 （2） 债务人怠于行使其到期债权

（3） 债务人怠于行使权利的行为已经对债权人造成损害 （4） 债务人的债权不是专属于债务人自身的债权。

原告：某市工商贸易公司 被告：某市鹏威 百货公司 第三人：某市智达贸易公司

●原告与第三人曾签订购销合同，第三人向原告购买家用电器一批，价值人民币100万元。原告依约发货后，第三人未能在合同约定期限到来时给付货款。原告多次催款，均未果。此时，第三人提出，被告曾在半年前向其购买电视机、冰箱等，共计人民币150万元，至今亦未清偿货款，但由于其与该被告为老主顾的关系，不愿意与之发生诉讼，只好等到其有能力偿还时才清偿该笔款项；现在其确实无力偿还所欠原告的该笔款项，请原告宽限时日。原告见第三人享有到期债权而不行使，遂向人民法院起诉，请求判令被告立即偿还所欠第三人的款项，由于第三人仅欠其100万元，因此其也仅主张所诉欠款中的100万元。 ●审判理由及结果：

人民法院经审理认为：在原告与第三人的合同关系中，第三人确实拖欠原告货款；而在第三人与被告的合同关系中，被告也确实拖欠第三人货款。但因第三人怠于行使其到期债券，在被告的还款期限届至之时，未能采取积极措施促使被告偿还货款，同意被告延期偿还，致使原告的合法债权受到损害而无法实现。原告依其债权人债权保全权之规则，行使代位权，合法有理，应予支持。根据《民法通则》及有关法律的规定，判决被告自判决生效之日起15日内向第三人支付所欠货款100万元。

债权保全权 - 撤销权cancellation right ●债权人的撤消权，是指当债务人积极地减少责任财产而害及债权人的债权时，债权人为保全其债权，以自己的名义向法院请求撤销该行为的权利。

●Where the obligor waived its creditor's right against a third person that was due or assigned its property without reward, thereby harming the obligee, the obligee may petition the People's Court for cancellation of the obligor's act. Where the obligor assigned its property at a low price which is manifestly unreasonable, thereby harming the obligee, and the assignee was aware of the situation, the obligee may also petition the People's Court for cancellation of the obligor's act.

撤销权的要件：

（1） 债权人对债务人必须享有合法有效的债权 （2） 债务人实施了一定的有害于债权的行为

撤销权行使的期限

撤销权自债权人知道或者应当知道撤销事由之日起一年内行使。自债务人的行为发生之日起五年内没有行使撤销权的，该撤销权消灭。

公司卖楼纠纷案：

被告某市房地产开发公司长期拖欠原告某市建筑公司工程款2000万元，原告多次催要未果，被告表示将卖掉公司楼房物业以作还债之用。后被告将其仅有楼房物业以捆绑式全体发售给某市

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实业公司，得款1500万元。但原告向物价部门要求对上述物业进行估价，其市场价值至少应为2100万元，原告遂向人民法院提起诉讼，请求判令撤销被告的上述处分行为，而应按照市场价格出售其所有物业。 ●审判理由及结果：

人民法院经审理认为，被告以明显不合理的低价转让其财产，将价值2100万元的财产以1500万元出售，其行为使原告的债权遭受实际的损害。故判令撤销上述买卖合同，被告与实业公司应各自返还其财产；被告在接受财产后，应将其财产作为清偿债务的财产，向原告清偿债务。

Amendment and Assignment of Contracts 合同的变更和转让

●A contract may be modified if the parties reach a consensus through consultation

Amendment 合同的变更 — 内容的变更

指合同成立后，在尚未履行前或者尚未完全履行前，当事人在原合同的基础上对合同的内容进行修改或者补充。

Amendment and Assignment of Contracts 合同的变更和转让 ●Assignment 合同的转让 — 主体的变更

●The obligee may assign its rights under a contract in whole or in part to a third person, except where such assignment is prohibited

1）Assignment 债权让与 — 对债务人的通知

●Where the obligee assigns its rights, it shall notify the obligor. 2）Delegation 债务转移 — 经债权人的同意

●Where the obligor delegates its obligations under a contract in whole or in part to a third person, such delegation is subject to consent by the obligee. 3）合同债权债务的概括转移

●Concurrent Assignment and Delegation

Upon consent by the other party, one party may concurrently assign its rights and delegate its obligations under a contract to a third person.

2000年10月15日，甲建筑公司与某砖厂签订了一份合同，约定：由砖厂在2000年11月底之前向甲建筑公司供应机制砖20万块，价格2万元；交货地点为砖厂；交货方式为自提。合同签订后，甲建筑公司即将货款全部付给了砖厂。后来，由于甲建筑公司承建的工程停建，故其不再需要20万块机制砖，而此时乙建筑公司恰好需要20万块机制砖。于是，甲建筑公司将20万块机制砖的合同债权转让给了乙建筑公司，但甲没有将合同债权转让的情况通知砖厂。当乙建筑公司前往砖厂提货时，遭到了砖厂的拒绝。

Termination of contract 合同的终止 ●Reasons for a contract to terminate：

(i) The obligations were performed in accordance with the contract; (清偿) (ii) The obligations were set off against each other; (抵销)

(iii) The obligor deposited the goods in accordance with the law; ( 提存 ) (iv) The obligee released the obligor from performance;

免除：免除即债权人抛弃其债权，全部或部分终止合同关系的单方行为。

(v) Both the obligee's rights and obligor's obligations were assumed by one party;混同：指债权与债务同归于一人，致使合同关系消灭的事实。

LECTURE9 Performance, Discharge and Remedies of Contract in Common Law

Conditions

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Generally, a party’s contractual duty to perform arises at the time the contract is formed, even though the time for performing is set for a future date. The parties may, however, provide that a party’s duty to perform is qualified by the happening of event or condition.

Three Types of Conditions ●conditions precedent ●conditions concurrent ●conditions subsequent

condition precedent

●If the event must occur before a party’s duty to perform arises, this is called a condition precedent. For example, Tom promises to buy Mary’s race car for $350,000 if the car wins the Indianapolis 500 race. The car’s winning the race is a condition precedent to Tom’s duty to buy. If the car does not win, the failure of condition has occurred, and Tom has no duty to buy the car.

condition subsequent

●If the happening of a condition discharges an existing duty to perform, this is called condition subsequent. For example, Joan and Mike enter a contract requiring Joan to mow Mike’s grass on July 3, the day before his big party on July 4 unless it rains. If it rains, Joan does not have to mow the grass, and Mike’s duty to pay Joan is discharged,

concurrent conditions

●If the contract calls for the parties to perform their duties at the same time, each party’s duty to perform is conditioned on the other party’s performance. These conditions are called concurrent conditions. Neither party can enforce the other promise without per-forming or tendering (offering) performance. For example, Pete agrees to buy Wendi’s cookie: not have a duty to pay the $150,000 unless Wendi tenders the store. Wendi does not have duty to give Pete the store unless Pete tenders the $ 150,000

Concept Summary: Condition ●Condition Precedent

Performance excused unless condition occur ●Condition Subsequent

Performance excused of condition occurs. ●Concurrent Condition

Tender of performance precedes right to demand performance

Standards of Performance

●A common source of dispute between contracting parties is whether the parties have fulfilled their duties of performance under the contract. The courts recognize three basic degrees of performance: 1) complete or satisfactory performance

2) substantial performance (construction contract is difficult to perform perfectly) 3) material breach of contract

material breach of contract

●When a person’s performance is due, any failure to perform that is not excused is a breach of contract. Not all breaches of contract are of equal seriousness, however. Some are relatively minor deviations, whereas others are so extreme that they deprive the promisee of the essence of what he bargained for. The legal consequences of a given breach depend on the extent of the breach.

Classification of Contract Breach 1. Non-performance

（1）Subjective non-performance不愿履行

●

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（2）Objective non-performance履行不能 2. Late performance 3. Partial performance 4. Defective performance

5. Anticipatory Breach and Actual Breach 6. Material Breach and nonmaterial Breach

Effect of Material Breach

●A material breach occurs when the promisor’s performance fails to reach the level of performance that the promisee is justified in expecting under the circumstances.

●The party who is injured by a material breach has the right to withhold his own performance. He is discharged from further obligations under the contract and may cancel it. He also has the right to sue for damages for total breach of contract.

Effect of Nonmaterial Breach

●By contrast, when the breach is not serious enough to be material, the nonbreaching party may sue for only those damages caused by the particular breach. In addition, he does not have the right to cancel the contract, although a nonmaterial breach can give him the right to suspend his performance until the breach is remedied. Once the breach is remedied, the nonbreaching party must go ahead and render his performance, minus any damages caused by the breach.

Determining the Materiality of the Breach

●The standard for determining materiality is a flexible one that takes into account the facts of each individual case. The key question is whether the breach deprives the injured party of the benefits that he reasonably expected.

Anticipatory Repudiation

●One type of breach of contract occurs when the promisor indicates before the time for his performance that he is unwilling or unable to carry out the contract. This is called anticipatory repudiation or anticipatory breach. Anticipatory breach generally constitutes a material breach of contract that discharges the promisee from all further obligation under the contract.

Remedies for Breach of Contract

●Contract remedies focus on the economic loss caused by breach of contract, not on the moral obligation to perform a promise. The objective of granting a remedy in a case of breach of contract is simply to compensate the injured party.

Types of Contract Remedies

1) Legal remedies (money damages)

2) Equitable remedies (such as Specific Performance ) 3) Restitution

●It requires the defendant to pay the value of the benefits that the plaintiff has conferred on him.

―Specific Performance‖ 是衡平法(equity)裡面的制度，翻譯為中文，可稱為「強制履行」，亦即請求法院對被告發出強制履行命令，以便契約進行的程序。

「強制履行」與我們常稱的「強制執行」概念上有所不同，不過可以我國強制執行法第四章「關於行為及不行為請求權之執行」來了解，二者皆是請求法院發出對被告為一定行為或不行為的命令，以便契約履行(例如請求被告交付貨品)，或禁止被告為一定之行為，以免損及原告利益(例如請求禁止被告交付貨品予第三人)。

原則上，―Specific Performance‖ 是屬於特殊的救濟方式，須在普通法(common law)的救濟方式

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不適當的情況下，法院才會許可發―Specific Performance‖的命令。普通法的救濟，一般就是損害賠償(damages)。因為以普通法救濟是否不適當，實在是人言言殊，為避免法院駁回―Specific Performance‖的申請，雙方常會在契約上訂入一條―Specific Performance‖ 的條款，現引例稿示之：‖Each party agrees that the extent of damages to the other party in the event of a breach of this Agreement is difficult or impossible to ascertain and that remedies at law may not be available or adequate. Consequently, each party agrees that in the event of such breach, the injured party shall be entitled to enforce any and all of the obligations contained in this Agreement by injunctive or other equitable remedy, including the remedy of specific performance without having to prove the inadequacy of money damages.‖ 也就是說，雙方同意可不必先證明金錢賠償為不適當之賠償方法(因為如果金錢賠償為適當，就不必強制履行了)，而逕請求「強制履行」。

此外，我們也常看到‖injunction‖這字眼，中文可稱為「禁止命令」，即禁止被告為一定行為之命令，故係屬於廣義―Specific Performance‖中的一種，通常會在―Specific Performance‖條文中出現。這種條款，在與老外交涉時，也不見得不能刪，不過，老外會說這是標準條款，沒有刪的必要。如果您是賣方，而貨有可能將來想賣給別人，當然就不想讓―Specific Performance‖訂入契約裡了。但原則上，稱―Specific Performance‖ 是標準條款也沒有錯，因其在契約上乃是十分常見的條款。

Legal Remedies ( Damages ) - Limitation on recovery of Damages in contract Cases

1. a party can recover damages only for those losses that he can prove with reasonable certainty.

2. A breaching party is responsible for paying only those losses that were foreseeable to him at the time of contracting.

3. Plaintiffs injured by a breach of contract have the duty to mitigate ( avoid or minimize ) damages.

Remedies under CISG

●The remedies under CISG are drawn from both common law and civil system (1) avoidance of the contract;

(2) seller’s right to remedy or cure; (3) seller’s additional time to perform (4) price reduction

(5) money damages (compensatory, consequential, punitive) (6) specific performance

Avoidance of contract

●In the case of a dispute under CISG, one party can avoid the contract only in the case of a fundamental breach by the other party.

Seller’s right to remedy

●A seller who has delivered some goods to the buyer prior to the delivery date, even if the goods are nonconforming or the shipment is not complete, has the chance to remedy the problem in the shipment, until the time for performance expires.

Seller’s additional time to perform

●In the event that the seller has failed to deliver the goods, and the time for their shipment or delivery has passed, the buyer may grant the seller extra time to do so. During this time, the buyer may not avoid the contract or resort to a breach of contract action.

Money damages

●The method of measuring money damages depends on whether the buyer has been able to purchase substitute goods from another supplier. If the buyer does purchase substitute goods, the buyer may claim damages if the substitute goods cost more than the contract price. If the buyer has not purchased substitute goods, damages are measured by the difference between the contract price and the current market price.

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Specific performance under CISG

●A court may grant specific performance only if all of the following conditions are met: (1) the buyer had not resorted to another remedy, such as avoidance or price reduction; (2) the seller had failed to deliver, or in the case of nonconforming goods, the nonconformity was so serious that it constituted a fundamental breach; (3) the buyer gave timely notice to the seller that the goods were nonconforming; (4) the buyer had made a timely request that the seller provide substitute goods.

Remedies of anticipatory breach

●Right to suspend performance: either party may suspend performance under a contract if one party realizes that the other party will not perform a substantial part of its obligations. The right to suspend performance ends when the other party provides adequate assurance that it will perform. ●Right to avoidance

●Avoidance of installment contract

Elements of contract breach (China)

●the two elements that constitute a contract breach： （1）existence of breach， （2）no excuses

Classification of contract breach

1 breach by one party/ breach by both parties单方违约与双方违约。 2 material breach/ non-material breach根本违约与非根本违约。 3 non-performance/ incomplete performance不履行，不完全履行。 4 anticipatory breach/ actual breach预期违约与实际违约。

案情介绍：

●恒通商场与瑞达电器集团于某年11月份订立了一份空调买卖合同，约定由瑞达电器集团于第二年的5月底交付空调500台给恒通商场，每台价4000元，恒通商场向瑞达电器集团交付30万元定金。第二年3月，气象部门纷纷预测今年将持续高温，瑞达电器集团的空调被订购一空，且订价达4500元每台。3月底，瑞达电器集团给恒通商场发了份函，声称无法履约，要求取消合同。商场为了防止瑞达电器集团向他人交付货物，于4月2日将瑞达电器集团诉至法院，要求其实际履行合同，如不实际履行，则应双倍返还定金，赔偿其利润损失，以及支付违约金。瑞达电器集团辩称，合同未到履行期，拒绝承担违约责任。

Common remedies for contract breach （1）强制履行 Specific Performance （2）损害赔偿 Money Damage （3）解除合同 Discharge （4）禁令 Injunction （5）违约金 Penalty

（6）采取补救措施 remedies（适用于不适当履行的情况）

（7）宽限期 period of grace （适用于迟延履行的情况）

remedies in China

1） 强制履行 (specific performance)

又称为实际履行，继续履行。指一方违反合同时，另一方有权要求其依据合同的规定继续履行。强制履行在我国是最重要的补救方法。对于金钱债务均可以适用强制履行，对于非金钱债务，适用强制履行有如下限制： 1）法律上或者事实上不能履行

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2）债务的标的不适于强制履行或者履行费用过高

违约的救济（补救方法）- 中国

2） 解除合同 cancellation of contract

按英美法的规定，只有在违反条件或重大违约时，才发生解除合同的问题。如果一方仅仅是轻微违约，对方只能请求损害赔偿，不能解除合同。在中国，违约致使合同履行成为不必要时，才成为解除合同的理由。

3）宽限期（给予违约方一段合理的额外履约期限）

?在买方要求卖方履行义务时，他可以规定一段合理时限的额外时间，就是Seller’s Additional Time to Perform。在这种情况下，除非买方收到卖方的通知，声称他将不在所规定的时间内履行义务，买方在这段时间内不得对违反合同采取任何其他补救办法。但是，买方并不因此丧失他对迟延履行义务可能享有的要求损害赔偿的任何权利。

违约的救济（补救方法）：中国

4） 损害赔偿：损害赔偿是指合同一方当事人的违约行为给对方当事人造成财产损失时，违约方向对方当事人所作的经济补偿。损害赔偿具有典型的补偿性，例外是，消费者权益保护法规定的经营者提供商品货服务有欺诈行为的，双倍赔偿的规定。

损害赔偿的构成要件： （1）损害事实 （2）违约行为

（3）违约行为与损害后果之间的因果关系

损害赔偿的计算公式

●损害赔偿范围=直接损失+间接损失-可避免的费用 – 可避免的损失

例：张三与李西与8月1日约定由张三于10月1日交付活鸡1000只，价格10000元，由李四负责提货。李四为此安排车辆运输，运费500元。李四又与王五签订合同，将该批活鸡转卖，价格15000元。

问（1）如果张三未能与10月1日将该批活鸡交付给李四，应当赔偿李四多少钱？

（2）如果张三准时交付，但交付的1000只活鸡有禽流感，导致李四自有的两千只鸭子死亡。每只鸭子8元。问张三应赔偿李四多少钱。

（3）如果张三在发现活鸡得了禽流感以后可以及时将其隔离，并予以处理。但张三拒绝及时处理该批活鸡，导致其两千只鸭子受感染。问张三应赔偿李四多少钱。

违约的救济（补救方法）- 中国

5） 定金 (EARNEST MONEY,DEPOSIT) 6） 违约金

这是违约补救的最常用办法之一。但各国规定有所不同。大陆法认为违约金具有两重性，即惩罚性和赔偿性，英美法认为，对于违约只能赔偿，而不能予以惩罚。 7）采取补救措施

修理：更换：重作：

8）减少价款或者报酬： ●A 公司为房地产公司，2002年初，其开发的某写字楼预计将于2002年6月竣工，A 公司开始进行预租售。B公司与A公司签订了房屋租赁合同，合同规定：B公司承租该写字楼六楼某写字间200平米，日租金4元，自2002年7月1日起租，租期3年。合同签订后，B公司按照约定预付了一年的租金。但2002年6月底，该写字楼未能如期完工。A公司承诺2002年底肯定

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竣工，B公司同意租期顺延。2002年底，该写字楼仍未竣工，B公司提出解除合同，并要求A公司返还预付租金，赔偿经济损失。而A公司认为合同一经签订，就具有法律效力，B公司不能解除合同，双方遂发生争议。B公司将A公司告上法庭，请求解除合同并赔偿损失。 请分析本案主要涉及什么法律问题？你对此如何分析？

●2002年5月，某食品公司因业务需要与某养鸡场签订了鸡蛋购销合同。双方约定：食品公司向养鸡场购买鲜鸡蛋4000公斤，每公斤价格为3.5元，共计1.4万元，货到付款，鸡蛋由养鸡场在5月底之前送至食品公司。5月27日，养鸡场按约定将4000公斤鲜鸡蛋运至食品公司，不料，食品公司因员工不慎引起公司厂房着火，短期无法恢复生产。据此，食品公司拒收鸡蛋，拒付货款，声称合同已无法履行，要求养鸡场另找销路。养鸡场无奈，只好将这批鲜鸡蛋又拉回养鸡场，但养鸡场对这批鸡蛋未采取任何保鲜措施。几天后，由于天气变热，养鸡场发现这批鸡蛋开始变质，只好采取措施另行销售，共支付销售费用1500元，但已有1000公斤鸡蛋变质，无法销售，该部分损失共计3500元。养鸡场要求食品公司赔偿销售费用及鸡蛋变质损失共计5000元。

请分析本案主要涉及什么法律问题？养鸡场的赔偿要求是否能得到支持？你对此如何分析？

●甲榨油厂与乙农户签订了一份花生买卖合同。合同规定：乙农户向甲榨油厂供应脱皮花生5000公斤，交货时间为2003年11月中旬，交货方式为甲榨油厂自提；甲榨油厂向乙农户交付1万元定金。合同订立后，甲榨油厂立即向乙农户交付了定金。然后，甲榨油厂又与某粮油公司签订了花生油买卖合同。同年9月，乙农户向甲榨油厂告知，由于今年雨水太少，花生长势不好，不能按合同约定的数量交货。甲榨油厂立即派人赴乙农户处了解详细情况，得知雨水问题并未影响花生收成，乙农户不愿交货的原因是与他人签订了价格更高的买卖合同。甲榨油厂多次表示希望乙农户如期交货，但均遭到拒绝。甲榨油厂为防止乙农户向他人交付货物，遂于当年10月10日在法院提起诉讼。

?问：甲榨油厂可以要求哪些救济？你对此如何分析？

违约的免责事由 Excuses

●Promisors who fail to perform satisfactorily may be able to a avoid the liability for breach of contract if they can show some legal excuse for their failure.

●The following discussion concerns the most common grounds for excuse of nonperformance.

法定的免责事由—不可抗力 Force Majeure Clauses

根据我国法律的规定，所谓不可抗力，是指不能预见，不能避免并不能克服的客观情况。不可抗力的要件为：

（1）不能预见，即当事人无法知道事件是否发生，何时何地发生，发生的情况如何。对此，应以一般人的预见能力为标准加以判断；（2）不能避免，即无论当事人采取什么措施，或即使尽了最大努力，也不能防止或避免事件的发生；（3）不能克服，即以当事人自身的能力和条件无法战胜这种客观力量；（4）客观情况，即外在于当事人的行为的客观现象。

Excuses for breach in Civil Law—情势变更原则 fundamental change in circumstances

情势变更原则是指合同成立后，作为合同关系基础的情势，由于不可归责于当事人的原因，发生了非当初所能预料的变化，如果仍坚持原来的法律效力将会产生显示公平的结果，有悖于诚实信用原则，因此，应当对合同的法律效力作相应的变更乃至合同解除的一项法律原则。

Excuses for Breach in UK Law ●Frustration of Contract(合同受挫）

?A contract is frustrated where, after the contract was concluded, events occur which different from that which was in the contemplation of the parties at the time they entered into the contract.

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?A contract which has become impossible of performance is frustrated.

?Where the common purpose for which the contract was entered into can no longer be carried out

because of some supervening event the contract may be frustrated. ?Supervening illegality can operate to frustrate a contract.

Excuses for Breach in USA Law

●Prevention (the promisee who causes the promisor’s failure of performance cannot complain about the failure. )

●Impossibility (If it becomes impossible for a promisor to perform his or her contractual duties, the duty to perform is discharged and the promisor is not liable for material breach) 1)Illness or Death of Promisor 2)intervening Illegality

3)Destruction of Subject Matter 4)Commercial impracticability 5)commercial Frustration

CISG exemptions for impediments beyond control

●A party is not liable for a failure to perform any obligations if : it was due to an impediment beyond control; the impediment was not reasonably foreseeable at the time the contract was concluded; the impediment was unavoidable and could not be overcome, notice was given to the other party of the impediment and of its effect on the contract.

LECTURE10 Introduction to different forms of business entities

sole proprietorships (sole trader)

●partnerships ( General Partnership, Limited Partnership)

●corporations: LLC (Limited Liability Company) ,CLS (Company limited by shares)

Sole proprietorship ●definition

A person doing business for himself or herself is a sole proprietor; the business organization is a sole proprietorship. it is the oldest and simplest form of business organization. ●characteristics

a. sole proprietorship is set up by one person without formality in enterprises; b. the assets of proprietorship belongs to the investor;

c. the investor bears unlimited liability to the proprietorship’s liability; d. the proprietorship is not a legal person ●merits

a. does not need large amount of capital; b. enjoys tax benefit;

c. easy to organize and inexpensive to operate 4. demerits

a. difficult to raise capital; b. unlimited liability; c. business scale is small.

Partnerships ●definition

An association of two or more persons to carry on a business as co-owners for a profit. The partners share control over the business’s operations and profits. Many attorneys, doctors, accountants, and retail stores are organized as general partnerships. A partnership can begin with an oral agreement or an implied agreement inferred from the conduct. ●characteristics

●

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a. the admission of new partner needs unanimous consent b. partners are liable for the partnership’s obligation.

c. partners bear joint and separate liability. （连带责任） ●merits

a. easy to organize and inexpensive to operate b. enjoys tax benefits

c. keeps commercial secret ●demerits

a. partners do not enjoy limited liability

b. a partner’ retirement, bankruptcy, withdraw or death may cause the partnership to dissolve

Case

●刘立、程非、张武三人合伙于二〇〇〇年四月创办生利纸品厂，各出资10万元，二〇〇一年五月张武退伙另图发展，收回了自己的全部合伙投入费及应得的利润。二〇〇二年七月债权人何强向张武追讨二〇〇〇年七月的欠款2.625万元（含二年的利息5%），张武以自己早已退伙为由拒绝归还，经多次协商未果，向人民法院提起诉讼，要求张武按协议归还欠款及利息2.625万元。

审理：人民法院在审理中查明，二〇〇〇年四月，刘立、程非、张武自愿合伙创办生利纸品厂，各出资10万元，利益共享，风险共担，有合伙协议为证。

●二〇〇一年五月张武退伙，抽回全部合伙投入费10万元及收益分配1.75万元，未对债务承担进行分割。二〇〇〇年七月，三人共同决定向债权人何强借款7.5万元，两年期利息5%，到期一次偿还7.875万元，由各人承担三分之一，有借款协议为证；刘立、程非已按协议归还何强借款5.25万元。

判决：张武在判决生效之日起十日内一次性归还债权人何强借款2.625万元

Corporations ●definition

A corporation is owned by shareholders who elect a board of directors to manage the business. Shareholders have limited liability for the obligations of the corporation. ●characteristics

a. Owner’s liability: the shareholders enjoy the limited liability;

b. Existence: The existence of the corporation is independent from the change of the shareholders. c.Legal Status: a corporation is a legal person and a legal entity independent of its owners (shareholders) and its managers (officers and board of directors);

d. Management: the management of the corporation is vested in the board of directors;

e. Transferability of owner’s interest: the shares may be sold or transferred to a third person without the approval of the corporation.

f. Taxation: a corporation pays income taxes on its income. A shareholder would have personal income from the corporation when the corporation pays him a dividend(股息）. And the shareholders pay tax on the dividends. ●merits

a. the investor enjoys limited liability

b. the business is managed by professional managers

c. the shareholders can easily exit the corporation by transferring the shares d. it can easily get money from the bank or securities market ●demerits

a. tax disadvantage

b. more expensive to operate c. complex structure

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Case

2002年4月30日，山东省东营某汽车修理有限公司以资金周转困难为由，向王某借款20万元作为生产的流动资金。双方约定年利率为7％，借款期限为1年，到期连本带息归还。但到约定的时间，该公司未向王某付款。汽车修理有限责任公司是由审理石油管理局钻井某公司、香港某公司出资组成的合资公司。见还款无望，王某将汽车修理有限公司、钻井公司、香港公司诉至法院。 Questions:

1. 石油管理局钻井公司、香港公司和汽车修理公司是什么关系？ 2. 法院该判谁偿还王某的借款？

Formation of corporation 1. In general

The formation of corporation is the process that the promoters tries to meet all the requirements in order to obtain the legal personality.

2. The conditions for the formation of corporation

There are only a few requirements for incorporation. The conditions prescribed by different countries vary, but usually include:

a. have qualified and adequate promoters b. have minimum legally required capital c. make the articles of corporation

d. have its own corporate name and corporate structure e. have its corporate domicile

3. Promoters（发起人） ●Definition

A person who takes the initiative in developing and organizing a new business venture. ●The activities of promoters

a. arrange necessary capital for the corporation b. obtain necessary assets and personnel

c. arrange the procedures for the formation of the corporation

4. Articles of association（公司章程） ●introduction

Articles of incorporation, frequently called ―corporate charter: or ―certificate of incorporation,‖ are at the heart of the incorporation process. They must be filed with the company registration authority in order to provide certain key information to the government and to any party dealing with the corporation.

It contains the name of the corporation, the registered office, the objects of the corporation, the liability of its members and the amount and division of shares, regulations for the internal management of the corporation

4.1 the memorandum of association（公司大纲）

In UK and Hong Kong, a corporation has both memorandum (key info.) and articles, while in US or China, these two have been combined in one document, articles of association.

5. Business scope of corporation (the objects clause) ●in general

The corporation's business scope shall be defined in its articles of association and shall be registered according to law.

●the change of business scope

The corporation may change its business scope by modifying its articles of association, but shall go

●

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through the formalities for modifying the registration.

●Effectiveness of transactions beyond business scope a. in China

(1) the transaction is effective if it needs no special permission from the government (2) the transaction is not effective if it needs special permission

b. in United States and England:

(1) in history, it’s not effective due to the principle of Ultra Vires (越权无效原则): ― any act not permitted by the corporation statute or by the corporation’s articles of incorporation was void due to lack of capacity. Case

Ashbury railway Carriage and Iron Co Ltd v. Riche

A corporation was incorporated with the following objects: to make, sell, or hire railway carriages and wagons;

to carry on the business of mechanical engineers and general contractors; and to purchase, lease, work, and sell mines, minerals, land and buildings.

The Directors contracted to purchase a concession to build a railway in Belgium and to provide Riche with finance for the construction of the railway. It was held that the contract was ultra vires and void. (2) nowadays, it’s usually effective

Today, the ultra vires doctrine is of small importance for two reasons. First, nearly all corporations have broad purpose clauses, thereby preventing any ultra vires problem. Secondly, most statutes do not permit a corporation or the other party to an agreement to avoid an obligation on the ground the corporation action is ultra vires.

Case

2003年6月，深圳某外贸公司向原告表示能介绍出口到俄罗斯的业务，但要求原告必须办理GOST认证，同时推荐被告为原告办理。此前原告的产品从未出口到俄罗斯，但俄罗斯广阔的市场需求对原告极具诱惑，为了能作成这笔生意，原告和被告就GOST认证一事于2003年6月24日签订合同，原告为委托方，被告为认证方，认证费用为58000元。该合同是被告提供的格式合同，根据合同条款，作为认证方的被告应做到：1、严格按照俄罗斯产品质量认证方面的法规和国际准则，审查原告的产品质量是否符合俄罗斯检测标准；2、在收到原告交付的费用后，及时组织实施有关的产品认证活动；3、被告在作出认证评定结论后，应及时办理是否批准原告取得认证注册资格的手续。合同签订后，原告向被告支付了58000元认证费用，可不久后的7月12日，《深圳特区报》B1版以很大的篇幅报道了被告进行―黑认证‖并与其他外贸公司涉嫌唱―双簧‖骗取钱财被国家认鉴委等部门查处。看到这则报道后，原告十分震惊，方知被告根本不具备认证的主体资格，其营业范围没有认证业务。知道上当后，原告急忙向法院提起诉讼，要求被告退回58000元的认证费用。

被告的营业执照上载明的经营范围是：举办实业（具体项目另行申报）；国内商业、物资供销业（不含专营、专控、专卖商品）；展览设计、信息咨询、企业形象策划（不含限制项目）；进出口业务（领取经营许可证后方可经营）。进行GOST认证并不在其经营范围之内，说明被告不具有认证机构的主体资格

法院经审理后认为，原被告双方于2003年6月23日签订的合同主要内容是被告为原告办理GOST认证，该合同是认证合同。根据《产品质量认证机构认可管理办法》的规定，凡申请开展产品质量认证工作的机构，必须依据该办法办理手续，申请国家技术监督局批准许可并取得《产品质量机构认可证书》，方可实施产品质量认证工作。因此认证活动是特许经营的，经营者需经过行政主管部门严格审批，取得《产品质量机构认可证书》并在工商登记经营范围内注明，方可从事认证活动。而被告工商登记的营业执照上所载明的经营范围根本没有登记认证业务，故被告不具有认证资格，其认证活动超出经营范围，并违反了法律法规的强制性规定，依据合同法极其司法解释的规定，双方所签合同为无效合同，原告因履行合同而支付的认证费用

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58000元，被告应当退回给原告。 The personality of corporation Definition

Corporation is regarded as a distinct legal entity with a separate existence from its membership and management team.We regard this independent and separate existence as the corporate personality. that is the Principle of Salomon

Case: Salomon v. Salomon & Co.

Salomon had for many years carried on a prosperous business as a leather merchant. In 1892 he decided to convert it into a limited company and for this purpose Salomon & Co. Ltd was formed with Salomon, his wife and five of his children as members and Salomon as managing director. The company purchased the business for 39,000 pound. The price was satisfied by 10,000 in debentures (secured by the company’s assets), 20,000 in fully paid 1 pound shares. The result was that Salomon’s wife and children held 1 share each, and the rest of the shares are held by Salomon. The company ran into difficulties a year later, then the creditors of the company appointed a receiver and the company went into liquidation.its assets were sufficient to discharge the debentures but not for the unsecured creditors.

The trial court and court of appeal held that the whole transaction was contrary to the true intent of the Companies Act and the company was a mere sham, Salomon was liable to indemnify the company. But the House of Lords unanimously reversed this decision. They held that the company has been validly formed since the Act merely required seven members holding at least one share each. It said nothing about their being independent. Hence the business belonged to the company and not to Salomon.

Since the Salomon case, the complete separation of the company and its members has never been doubted. Only in a few circumstances, the court would allow the pierce of corporate veil.

The nature of corporate personality ●legality

The independent existence of corporation from its investors is reflected and respected by law. ●independence

The personality of corporation is distinct from the personality of its members. a. independence of assets b. independence of liability c. independence of existence d. independent right to sue ●equality

The personality of different corporations shall be equal.

The importance of corporate personality

Corporation has independent personality has become the most important rule in the corporate law. ●Encourage investors to invest in the corporate form

●Protect the creditors’ interest by preventing the shareholders usurping the corporate assets

Reflection of corporate personality

●Corporate name, purpose, domicile, nationality ●Corporate power a. contents

The corporation has civil capacity (公司具有民事行为能力）. b. restrictions

But the corporate personality is also restricted and limit. restricted by nature restricted by law

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Piercing the corporate veil (公司的人格否认） ●definition

Normally, Corporate creditors will not be allowed to chase the personal assets of individual shareholders, and creditors of individual shareholders will not be allowed to seize corporate assets. So the corporate law erects an imaginary wall between a corporation and its shareholders. But in some situations, the existence of even a perfectly formed corporation should be ignored. In such cases, courts ―pierce the corporate veil‖. The primary consequence of piercing the corporate veil is that a corporation’s shareholders may lose their limited liability.

Factors in deciding whether to pierce the corporate veil

●commingling of funds and other assets of the corporation with those of the individual shareholders; ●an individual shareholder representing to persons outside the corporation that he or she is personally liable for the debts or other obligations of the corporation

●failure to maintain corporate minutes or adequate corporate records; ●identical equitable ownership in two entities;

●identity of the directors and officers of two entities who are responsible for supervision and management;

●sole ownership of all the stock by one individual or members of a single family;

●use of the same office or business location by the corporation and its individual shareholder.

●use of a corporation as a tool for illegal transaction. The corporation is an ―instrument‖ or ―alter ego‖ of the shareholder to avoid law

Case: Walkovszky v. Carlton

The plaintiff was severely injured four years ago in New York City when he was run down by a taxicab owned by the defendant Seon Cab Corporation and negligently operated at the time. The individual defendant, Carlton, is claimed to be a stockholder of 10 corporations, including Seon, each of which has but two cabs registered in its name, and it is implied that only the minimum automobile liability insurance required by law is carried in any one cab. Although seemingly independent of one another, these corporations are alleged to be operated as a single entity with regard to financing, supplies, repairs, employees and all are named as defendants. Judgment:

The law permits the incorporation of a business for the very purpose of enabling its investors to escape personal liability but, manifestly, the privilege is not without its limits. Broadly speaking, the courts will disregard the corporate form, or pierce the corporate veil whenever necessary to prevent fraud or to achieve equity.

Case: Gilford Motor Co. V. Horne

Mr. Horne had a company incorporated to solicit business from the customers of his previous employer. He personally was prohibited from soliciting customers by a restrictive covenant he had entered into with his previous employer. Although he was neither a director nor shareholder of the company (these positions being taken by his wife and an employee), the court found that the company was carrying on his business and granted an injunction against it to stop it breaching his restrictive covenant. Thus the company was made subject to the same liabilities as Mr. Horne.

原告北京博士伦眼睛护理产品有限公司在向法院提交的追加被告申请书中称，原告在案件诉讼中发现被告公司股东朱某利用其持有被告公司80%的股份，及法定代表人的身份掌控长沙市佳健眼睛有限公司，并将从原告处所购买货物的90%转交给了上海佳健眼睛有限公司进行销售。被告只是名义上的货主，实际上是货物中转仓库，上海公司才是直接受益人。而上海公司的股东也为朱某及其丈夫，两人各持股50%。

原告认为，朱某以被告长沙市佳健眼睛有限公司名义在长沙向原告购货，再将被告资产转移到其上海公司，然后在长沙消失，退租店面，使被告仅剩下一个法律空壳，债权人即使取得胜诉判决，也难以得到执行。

Questions: 如果你是法官，你如何判决？

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