1、Unit 5 Breach of the Contract,When a persons 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 t

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

3、e 5. Anticipatory Breach and Actual Breach 6. Material Breach and nonmaterial Breach,Effect of Material Breach,A material breach occurs when the promisors performance fails to reach the level of performance that the promisee is justified in expecting under the circumstances. The party who is injured

4、 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

5、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 reme

6、died, 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 t

7、he 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 repud

8、iation 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 mo

9、ral 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 defenda

10、nt to pay the value of the benefits that the plaintiff has conferred on him.,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

11、 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;

12、 (2) sellers right to remedy or cure; (3) sellers additional time to perform (4) price reduction (5) money damages (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.,Sellers

13、 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.,Sellers additional time to perform,In the

14、 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 m

15、oney 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

16、 measured by the difference between the contract price and the current market price.,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

17、 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 substitut

18、e 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

19、 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單方違約與雙方違約

20、。 2 material breach/ non-material breach根本違約與非根本違約。 3 non-performance/ incomplete performance不履行，不完全履行。 4 anticipatory breach/ actual breach預(yù)期違約與實(shí)際違約。,common remedies for contract breach,（1）強(qiáng)制履行 Specific Performance （2）損害賠償 Money Damage （3）解除合同 Discharge （4）禁令 Injunction （5）違約金 Penalty （6）采取補(bǔ)救措施 rem

21、edies（適用于不適當(dāng)履行的情況） （7）寬限期 period of grace （適用于遲延履行的情況）,remedies in China,1） 強(qiáng)制履行 (specific performance) 又稱為實(shí)際履行，繼續(xù)履行。指一方違反合同時(shí)，另一方有權(quán)要求其依據(jù)合同的規(guī)定繼續(xù)履行。強(qiáng)制履行在我國是最重要的補(bǔ)救方法。對于金錢債務(wù)均可以適用強(qiáng)制履行，對于非金錢債務(wù)，適用強(qiáng)制履行有如下限制： （1）法律上或者事實(shí)上不能履行 （2）債務(wù)的標(biāo)的不適于強(qiáng)制履行或者履行費(fèi)用過高,違約的救濟(jì)（補(bǔ)救方法）- 中國,2） 解除合同 cancellation of contract 按英美法的規(guī)定，只有在

22、違反條件或重大違約時(shí)，才發(fā)生解除合同的問題。如果一方僅僅是輕微違約，對方只能請求損害賠償，不能解除合同。在中國，違約致使合同履行成為不必要時(shí)，才成為解除合同的理由。 3）寬限期（給予違約方一段合理的額外履約期限） 在買方要求賣方履行義務(wù)時(shí)，他可以規(guī)定一段合理時(shí)限的額外時(shí)間，就是Sellers Additional Time to Perform。在這種情況下，除非買方收到賣方的通知，聲稱他將不在所規(guī)定的時(shí)間內(nèi)履行義務(wù)，買方在這段時(shí)間內(nèi)不得對違反合同采取任何其他補(bǔ)救辦法。但是，買方并不因此喪失他對遲延履行義務(wù)可能享有的要求損害賠償?shù)娜魏螜?quán)利。,違約的救濟(jì)（補(bǔ)救方法）：中國,4） 損害賠償：損害賠

23、償是指合同一方當(dāng)事人的違約行為給對方當(dāng)事人造成財(cái)產(chǎn)損失時(shí)，違約方向?qū)Ψ疆?dāng)事人所作的經(jīng)濟(jì)補(bǔ)償。損害賠償具有典型的補(bǔ)償性，例外是，消費(fèi)者權(quán)益保護(hù)法規(guī)定的經(jīng)營者提供商品貨服務(wù)有欺詐行為的，雙倍賠償?shù)囊?guī)定。 損害賠償?shù)脑瓌t： （1）完全賠償原則 （2）可預(yù)見原則 （3）減輕損失原則,損害賠償?shù)挠?jì)算公式,損害賠償范圍=直接損失+間接損失-可避免的費(fèi)用 可避免的損失 例：張三與李西與8月1日約定由張三于10月1日交付活雞1000只，價(jià)格10000元，由李四負(fù)責(zé)提貨。李四為此安排車輛運(yùn)輸，運(yùn)費(fèi)500元。李四又與王五簽訂合同，將該批活雞轉(zhuǎn)賣，價(jià)格15000元。 問（1）如果張三未能與10月1日將該批活雞交付給

24、李四，應(yīng)當(dāng)賠償李四多少錢？ （2）如果張三準(zhǔn)時(shí)交付，但交付的1000只活雞有禽流感，導(dǎo)致李四自有的兩千只鴨子死亡。每只鴨子8元。問張三應(yīng)賠償李四多少錢。 （3）如果李四在發(fā)現(xiàn)活雞得了禽流感以后可以及時(shí)將其隔離，并予以處理。但張三拒絕及時(shí)處理該批活雞，導(dǎo)致其兩千只鴨子受感染。問張三應(yīng)賠償李四多少錢。,違約的救濟(jì)（補(bǔ)救方法）- 中國,5） 定金 (deposit) 6） 違約金 （Liquidated Damage） 這是違約補(bǔ)救的最常用辦法之一。但各國規(guī)定有所不同。大陸法認(rèn)為違約金具有兩重性，即懲罰性和賠償性，英美法認(rèn)為，對于違約只能賠償，而不能予以懲罰。 7）采取補(bǔ)救措施 修理：更換：重作：

25、8）減少價(jià)款或者報(bào)酬：,違約的免責(zé)事由 Excuses,Although nonperformance of a duty that has become due will ordinarily constitute a breach of contract, there are some situations in which nonperformance is excused because of factors that arise after the formation of the contract. When this occurs, the person whose perfor

26、mance is made impossible or impracticable by these factors is discharged from further obligation under the contract. The following discussion concerns the most common grounds for excuse of nonperformance.,法定的免責(zé)事由不可抗力 Force Majeure Clauses,根據(jù)我國法律的規(guī)定，所謂不可抗力，是指不能預(yù)見，不能避免并不能克服的客觀情況。不可抗力的要件為： （1）不能預(yù)見，即當(dāng)事人

27、無法知道事件是否發(fā)生，何時(shí)何地發(fā)生，發(fā)生的情況如何。對此，應(yīng)以一般人的預(yù)見能力為標(biāo)準(zhǔn)加以判斷；（2）不能避免，即無論當(dāng)事人采取什么措施，或即使盡了最大努力，也不能防止或避免事件的發(fā)生；（3）不能克服，即以當(dāng)事人自身的能力和條件無法戰(zhàn)勝這種客觀力量；（4）客觀情況，即外在于當(dāng)事人的行為的客觀現(xiàn)象。,Excuses for breach in Civil Law情勢變更原則 fundamental change in circumstances,情勢變更原則是指合同成立后，作為合同關(guān)系基礎(chǔ)的情勢，由于不可歸責(zé)于當(dāng)事人的原因，發(fā)生了非當(dāng)初所能預(yù)料的變化，如果仍堅(jiān)持原來的法律效力將會(huì)產(chǎn)生顯示公平的結(jié)果，有悖于誠實(shí)信用原則，因此，應(yīng)當(dāng)對合同的法律效力作相應(yīng)的變更乃至合同解除的一項(xiàng)法律原則。,Excuses for Breach in Comm