|
It fails to exercise the cancellation right within one year, commencing on the date when the party knew or should have known the cause for the cancellation;
Note that the period of one year cannot be extended in any case.
4. Performance of Contracts 合同履行
A. Full Performance (Art. 60 CL)
The parties shall fully perform their respective obligations in accordance with the contract. The parties shall abide by the principle of good faith, and perform obligations such as notification, assistance, and confidentiality, etc. in light of the nature and purpose of the contract and in accordance with the relevant usage.
C. Demurrer in the Process of Performance 抗辩权
a. Demurrer in case of Simultaneous Performance 同时履行抗辩权
Demurrer is the right to reject. In case of simultaneous performance, either party has right not to perform if the other party fails to perform, or not fully performs. (Art. 66 CL)
b. Demurrer in case of Consecutive Performance 先履行抗辩权
In case that the contract obligations of the parties should be performed in order, i.e. one party should perform earlier than the other party, the party who performs later can reject its performance if the other party fails to perform, or not fully performs, in the first place.
c. Right to Suspend Performance (Art. 68 CL) 不安抗辩权
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:
Its business has seriously deteriorated;
It has engaged in transfer of assets or withdrawal of funds for the purpose of evading debts;
It has lost its business creditworthiness;
d. Subrogation (Art. 73 CL) 代位权
Subrogation means to substitute one person for another. In contract law regime, it refers to a situation where the debtor delays to exercise his creditor’s right against a third person that was due, thereby harming the obligee, the obligee may ask the court for subrogation.
Note that in a suit based on subrogation, the defendant is the third part, and not the debtor. And it is imperative for the debtor to intervene regardless of his own intention to do so.
e. Obligee’s Right to Cancel Manifestly Unreasonable Act by Obligor 撤销权
i. Definition (Art. 74 CL)
Where the debtor
(1) waived its creditor’s right against a third person that was due, or
(2) assigned its property without reward, or
(3) assigned its property at a low price which is manifestly unreasonable,
Thereby harming the obligee, the obligee may ask the court to cancel the debtor’s act.
ii. Time Limit B (Art. 75 CL)
The creditor’s cancellation right shall be exercised within one year, commencing on the date when it became, or should have become, aware of the cause for cancellation.
Subrogation and cancellation are kind of the same case. As regards subrogation, the debtor is passive to decrease its belongings to avoid its performance, whereas in case of cancellation the debtor is active to decrease its belongings to avoid its performance.
Case 10
A owed B 10,000. In April 2003, after knowing B was planning to sue, A sold his property which values at 30,000 to C at the price of 100. B knew the transaction in May 2003 and he brought an action before the court in June 2004. Which claim in the following may be supported by the court? (Selected from Chinese Bar Examination 2005)
A. the transaction between A and C is void.
B. the transaction between A and C should be cancelled
C. Subrogate A to ask for C’s performance
D. C infringed A’s property rights
5. Extinction and Termination of a Contract
The rights and obligations under a contract are discharged in any of the following circumstances: (Art. 91 CL)
A. The obligations were performed in accordance with the contract;
B. The contract was terminated; 解除
a. termination by consent (Art. 93 CL)
b. under the following conditions, the parities may terminate a contract. (Art. 94 CL)
force majeure frustrated the purpose of the contract;
Force majeure means conditions beyond control, such as earthquake, strike, etc. Herein no liability of breach of the contract.
Before the time of performance, the other party expressly stated or indicated by its conduct that it will not perform its main obligations;
The other party delayed performance of its main obligations, and failed to perform within a reasonable time after receiving demand for performance;
The other party delayed performance or otherwise breached the contract, thereby frustrating the purpose of the contract;
C. The obligations were set off against each other; (Art. 99, 100 CL) 抵销
D. the obligor placed the subject matter in escrow in accordance with the law, under the following conditions. (Art. 101 CL) 提存
Escrow means to be taken by the third party.
The obligee refuses to take delivery of the subject matter without cause;
|
