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Session1

VIEWS: 15 PAGES: 56

									Comparative Contract Law in East Asia



             Bor-shan Lin
          The Master Said
Confucius said:
– Is it not pleasant to learn with a constant
  perseverance and application (practice)?
– Is it not delightful to have friends coming from
  distant quarters?
– Is he not a man of complete virtue, who feels
  no discomposure though others may take no
  note of him?
  (Confucian Analects, First Chapter, Learning)
            Function of the Law

Confucius said:
– If the people are led by laws and uniformity is sought
  to be given them by punishments, the people may
  avoid the punishment but they will have no sense of
  shame.
– If they are led by virtue and uniformity is sought to be
  given them by the rules of propriety, they will have the
  sense of shame and moreover will become good
  (conscientious improvement).
  (Confucian Analects, Second Chapter, Exercising
  Governance)
Sources of Contract Law and their Hierarchy
               Sources of law
Formal source of law
– Enacted law
     Constitution
     Statutes
     Administrative Regulations and ordinances
     Regulations made by autonomous entity
     International Treaty
– Non-enacted law
     Judicial precedents
     Judicial interpretation
     Explanation made by administrative branch
Non-formal source of law
– Customary law
– Legal principles of law
  Jurisdictions in East Asia
Greater China
– Mainland China (PRC)
– Macau (PRC)
– Hong Kong (PRC)
– Taiwan (ROC)
Japan
Korea
PRC Contract Law
The Constitution
Statutes
– Basic Law (enacted by NPC)
    The General Principle of Civil Law (GPCL)(1986)
    Contract Law
     – The Tripod of Contract Law (1981~1999)
           Economic Contract Code (ECL)(1981)
           Foreign Economic Contract Code (FECL)(1985)
           Technology Contract Code (TCL)(1987)
     – Unified Contract Law (after 1999)
           Contract Code (1999)
 – Other Laws (enacted by NPCSC)
       Advertisement Law
       Product Quality Law
       Consumer Rights and Interest Protection Law
       Labor Law
       Maritime Law
       Insurance Law
       Copyright Law
       Patent Law
       Security Law
Administrative Regulations
Ministerial Rules
Authoritative Interpretation
 – Legislative interpretation
 – Judicial interpretation
Local Regulations
Case law
Customary law
General principles of law
State policy
Taiwan Contract Law
The Direct Sources of Law
– Enacted law
      Legislatures
        –   ROC Civil Code
        –   Consumer protection law
        –   Insurance Law
        –   Maritime Commerce Law
        –   Other special civil law
      Administrative regulations
        – Regulations about adherence contract
      Autonomous regulations
      International treaties
– Customary law
– General principles of law
The Indirect Sources of Law
– Case law (Precedents)
– Interpretation
      Interpretation of the Grand Justice
The Development of Contract Law in China
• Merger of Civil Law and Criminal Law
  – In China legal history, criminal law and administrative
    law had been vastly developed and comparatively
    complete, such as Tang Code and Qing Code: however,
    in terms of civil law, the provisions to regulate civil
    relationship were sparsely existed within laws other
    than civil code due to a lack of systematic codification
    of civil code in China. Until the end of Qing dynasty,
    Qing Court, central government of imperial China,
    moved to renovate its legal system so as to catch up its
    Western counter part.
• Buffeted by the European wind
  – Open her market under war
    • The Opium War (1839-1842)
    • Unequal treaties with its western counterparts
    • The principle of extraterritoriality exempting all
      foreigners
    • Sino-Japanese War in 1884-1885, Eight- Countries
      -Alliance War (1900)
  – Collision between Chinese value and Western
    value
    • Successful experience of Japan reformation.
• Reformation during the Late of Qing
  Dynasty
  – Borrowed European legal system into Chinese legal system
     • The Qing government realize that its failure in wars with
       western countries should be imputed to its political system
       and law, rather than the lack of strong boats and sharp
       weapons.
      • The Emperor Guang Xu said:
          – What caused China to be so weak are the deep bad
            habits and heavy law...What misleads China lies in
            the word of selfishness. What puzzles us lies in the
            word of convention. Generally speaking, if the law
            exists too long there must be some drawbacks. Such
            laws should be reformed".
      •
• The Qing government also emphasized that to learn from
  the western countries China had to learn the essence and
  origin of foreign systems but not superficial knowledge.
• Dispatched a mission composed of five high rank
  officials to visit Japan and European countries.
• Organized a committee to draft Civil Code.
• Set up a Ministry of Justice in lieu of Fa Bu.
• Promulgated a Outline for Constitution.
• First draft of Civil Code (The Great Chin Civil Code
  Draft)
   – In 1902, Qing Court set up a the Commission of Legal Reform to
     draft law. In 1903, Qing court nominated Shen, Jia-ben, Yu, lian-
     San, and Yeng Rue as commissioners to draft modern law and, in
     1907, to invite Justice of the Great Court, Matsuoka, and legal
     scholar Ishida Kotaro, assist to draft the first draft of Chinese Civil
     Code. The Commission was entrusted to revise the existing Chinese
     laws "in accordance with the actual situation of foreign affairs to
     carefully revise all the existing laws with reference to laws of
     western countries after suitable discussion and consideration. The
     purpose is to align our Chinese laws with foreign laws and serve the
     society control".
   – The draft went into history with the collapse of the Qing Empire
     which had been overturned by democratic revolution in 1911.
• Legislation during Republican Regime
  – Democratic revolution (1911) to China
    Unification (1927)
    • The Birth of the Republic of China (1912)
    • Political Turmoil
       – A decade of Warlordism (1916-1927)
       – Cabinet system v. president system; separation of
         five power
  – Second Draft of Civil Code
    • Drafted by Chinese scholars from 1915 to
      1916.(during last period of warlord era)
– Promulgation of the Current ROC Civil Code
  • Promulgated from 1929 -1930 (after China
    unification)
  • Five books: the structure and provisions mainly
    borrowed from Germany Civil Code; some
    provisions borrowed from Swiss Civil Code, and
    Japan Civil Code.
  • Revised in 1982,1985,1988,1999,2000,2002 in
    Taiwan.
• Socialist Legal System
  – Destruction of legal Institutes (1949)
     • European legal experience abrogated
     • Abrogation of ROC Six Books of Law, including
       the ROC Civil Code.
  – Adopted Soviet legal system overwhelmingly
     • China and Soviet Union has established a firm
       friendship (PRC 1954 first Constitution, preamble)
     • Marriage Law and Employment Law independent
       from civil law (modeled on those of Soviet Union)
• Rehabilitation of legal system (1978-)
  – Recovering from the devastating legacy of
    Maoism and Cultural Revolution
  – Adopted a new Criminal Code
  – Adopted ECL, FECL, GPCL, TCL
• Modernizations of civil law
  – Adopted a unified contract law
  – Codification of new millennium civil code.
Structure of Contract Law
        Structure of PRC GPCL
Chapter I Basic Principles
Chapter II Citizen (Natural Person)
 –   Section 1 Capacity for Civil Rights and Capacity for Civil Conduct
 –   Section 2 Guardianship
 –   Section 3 Declarations of Missing Persons and Death
 –   Section 4 Individual Businesses and Leaseholding Farm Households
 –   Section 5 Individual Partnership
Chapter III Legal Persons
 – Section 1 General Stipulations
 – Section 2 Enterprise As Legal Person
 – Section 3 Official Organ, Institution And Social Organization As Legal
   Persons
 – Section 4 Economic Association
Chapter IV Civil Juristic Acts and Agency
 – Section 1 Civil Juristic Acts
 – Section 2 Agency
Chapter V Civil Rights
 –   Section 1 Property Ownership and Related Property Rights
 –   Section 2 Creditors' Rights
 –   Section 3 Intellectual Property Rights
 –   Section 4 Personal Rights
Chapter VI Civil Liability
 –   Section 1 General Stipulations
 –   Section 2 Civil Liability for Breach of Contract
 –   Section 3 Civil Liability for Infringement of Rights
 –   Section 4 Methods of Bearing Civil Liability
Chapter VII Limitation of Action
Chapter VIII Application of Law in Civil Relations with Foreigners
Chapter IX Supplementary Provisions
Structure of PRC Contract Code
 General Principles
 – Chapter 1 General Provisions
     Purpose, Definition of Contract, Fairness, Good faith,
     Legality…
 – Chapter 2 Formation of Contract
 – Chapter 3 Validity of Contract
 – Chapter 4 Performance of Contract
 – Chapter 5 Modification and Transfer of Contract
 – Chapter 6 Discharge of Contractual Rights and
   Obligations
 – Chapter 7 Liability for Breach of Contract
 – Chapter 8 Other Provisions
Specific Provisions
– Chapter 9 Sale
– Chapter 10 Contracts for the Supply and Use of Electricity,
  Water, Gas and Heat
– Chapter 11 Gifts
– Chapter 12 Loan
– Chapter 13 Lease
– Chapter 14 Financial Leasing
– Chapter 15 Contract for Work
– Chapter 16 Construction Project Contract
– Chapter 17 Carriage
– Chapter 18 Technology Contract
– Chapter 19 Deposit Contract
– Chapter 20 Warehousing Contract
– Chapter 21 Mandate
– Chapter 22 Commission Agency Contract
– Chapter 23 Brokerage Contract
     Structure of Civil Code
ROC Civil Code          Japan and Korea Civil
– Book I General        Code
  Principles            – Book I General
– Book II Obligations     Principles
– BookⅢ Rights of       – Book II Rights of
  Things                  Things
– BookⅣ Family          – BookⅢ Obligation-
– BookⅤ Inheritance       Rights
                        – BookⅣ Family
                        – BookⅤ Inheritance
     Structure of Civil Code
French Civil Code         German Civil Code
– Preliminary Title       – Book I General
– Book I Of Persons         Principles
– Book II Of Property     – Book II Law of
  and of the Various        Obligations
  Kinds of Property       – BookⅢ Rights of
  Rights                    Things
– Book III Of the         – BookⅣ Family Law
  Different Ways in       – BookⅤ Law of
  Which Property Rights     Inheritance
  Can Be Acquired
                              Civil Code

                                                      General Principles
                                                          T(1~152)
        Legal Status                  Property Law
                                                         J(1~174bis)
                                                          K(1~184)

 Succession        Family     Rights in Rem   Obligations
T(1138~1225)    T(967~1137)    T(757~966)     T(153~756)
 J(882~1044)     J(725~881)   J(175~398-22)   J(399~724)
K(997~1118)     K(367~996)     K(185~372)     K(373~766)
   ROC Civil Code Book I General
    Principles
       Chapter Ⅰ Application Rules
       Chapter Ⅱ Persons
       Chapter Ⅲ Things
       Chapter IV Juristic Acts
       Chapter V Dates and Periods of Time
       Chapter VI Extinctive Prescription
       Chapter VII Exercise of Rights
   ROC Civil Code Book II Obligations
    Chapter   Ⅰ General Provisions
      Section   1 – Occurrence of Obligations
      Section   2 - Object of Obligations
      Section   3 - Effects of Obligations
      Section   4 - Plurality of Creditors and Debtors
      Section   5 – Transfer of Obligations
      Section   6 - Extinction of Obligations
– Chapter II Particular Kinds of Obligations
    Section 1 Sales
    Section 2 Exchange
    Section 3 Mutual Account
    Section 4 Gift
    Section 5 Lease
    Section 6 Loan (for use & for consumption)
    Section 7 Contract for Services
    Section 8 Contract for Work
    Section 8-1 Travel
Section 9 Publication
Section 10 Mandate
Section 11 Manager and Commercial Agents
Section 12 Brokerage
Section 13 Commission Agency
Section 14 Deposit (or Bailment)
Section 15 Warehousing
Section 16 Carriage
Section 17 Forwarding Agency
Section 18 Partnership
Section 19 Silent Partnership
Section 19-1 Bid Society
Section 20 Security Payable by an Assigned
Person
Section 21 Securities Payable to Bearer
Section 22 Annuity for Lifetime
Section 23 Compromise (or Settlement)
Section 24 Suretyship
Section 24-1 Employment Suretyship
   Japan Civil Code Book I General
    Principles
       Application Rules
       Chapter I Persons
       Chapter II Juristic Person
       Chapter Ⅲ Things
       Chapter IV Juristic Acts
       Chapter V Periods of Time
       Chapter VI Prescription
   Japan Civil Code Book III Creditor’s rights
       Chapter Ⅰ General Provisions
        Section   1 –Object of Creditor’s rights
        Section   2 - Effects of Creditor’s rights
        Section   3 –Creditor’s rights with Plural Parties
        Section   4 - Assignment of Creditor’s rights
        Section   5 – Extinction of Creditor’s rights
– Chapter II Contract
    Section 1 General Provisions
    Section 2 Gift
    Section 3 Sales
    Section 4 Exchange
    Section 5 Loan for consumption
    Section 6 Loan for use
    Section 7 Lease
    Section 8 Contract for Services
    Section 9 Contract for Work
    Section 10 Mandate
    Section 11   Deposit (or Bailment)
    Section 12   Partnership
    Section 13   Annuity for Lifetime
    Section 14   Compromise (or Settlement)
– Chapter III Management of Affairs Without
  Mandate
– Chapter IV Unjust Enrichment
– Chapter V Torts
   Korea Civil Code Book I General
    Principles
       Chapter I General Provisions
       Chapter II Persons
       Chapter III Juristic Person
       Chapter IV Things
       Chapter V Juristic Acts
       Chapter VI Periods of Time
       Chapter VII Prescription
   Korea Civil Code Book III Creditor’s rights
       Chapter Ⅰ General Provisions
        Section   1 –Object of Creditor’s rights
        Section   2 - Effects of Creditor’s rights
        Section   3 –Plurality of Creditors and Debtors
        Section   4 - Assignment of Creditor’s rights
        Section   5 –Delegation of Obligation
        Section   6 - Extinction of Creditor’s rights
        Section 7 – Creditor’s rights Payable by an
        Assigned Person
        Section   8 - Creditor’s rights Payable to Bearer
– Chapter II Contract
    Section 1 General Provisions
    Section 2 Gift
    Section 3 Sales
    Section 4 Exchange
    Section 5 Loan for consumption
    Section 6 Loan for use
    Section 7 Lease
    Section 8 Contract for Services
    Section 9 Contract for Work
    Section 10 Promise of Reward
    Section 11 Mandate
    Section 12   Deposit (or Bailment)
    Section 13   Partnership
    Section 14   Annuity for Lifetime
    Section 15   Compromise (or Settlement)
– Chapter III Management of Affairs Without
  Mandate
– Chapter IV Unjust Enrichment
– Chapter V Torts
Draft of China Civil Code (1209)
 General Principles
 Rights of Personality
 Torts
 Contract
 Rights in Rem (property)
 Marriage
 Adoption
 Inheritance
 Private international law
The Relation between Civil Law and Commercial Law

  Contracts regarding private legal relationship
   – Individual contract:
         Sale, gift, lease, loan, contract for service, conveyance of property
         right, adoption, marriage…
   – Commercial contract:
         Sale of Goods, Exchange, Mutual Account, Gift, Lease, Financial
         Lease, Loan (for use & for consumption), Contract for Services,
         Contract for Work, Travel, Publication, Mandate, Manager and
         Commercial Agents, Brokerage, Commission Agency, Deposit (or
         Bailment), Warehousing, Carriage, Forwarding Agency, Partnership,
         Silent Partnership, Bid Society, Security Payable by an Assigned
         Person, Securities Payable to Bearer, Annuity for Lifetime,
         Compromise (or Settlement), Suretyship,, Employment Suretyship
  Unification in the field of civil and commercial obligations
   – In several international conferences, it has been fostered the
     unification of civil and commercial obligations.
– This unification exists in
    the Swiss Federal Code of obligation of 1912,
    the French and Italian draft civil Code,
    the ROC Civil Code of 1929
    the civil code of Tunes of 1906,
    the Morocco's civil code of 1912,
    the Turkish Civil Code of 1926,
    the Lebanon's Civil Code of 1934,
    the Civil Code of Poland of 1934,
    the Civil Code of Madagascar, Senegal.
– And said unification is partially ruled in the civil code
  of Italy , former Soviet Union , Peru , Paraguay ,
  Cuba , Holland , Mongolia , Vietnam , the Russian
  Federation , Taiwan , Thailand , Québec, the General
  Principles of Civil law in China, and the Argentine
  drafts of 1987, 1993, and 1998 .
– Moreover, the Peruvian draft also unifies the rules
  governing both civil and commercial obligation.
– The new Brazilian Civil Code of 2003 derogated , in
  part, the Commercial Code, which had a major
  backwards. For instance, section 273 regulated the
  issue of slaves.
Separation in the field of civil and
commercial obligations
– Enactment of Civil Code and Commercial
  Code to regulate civil and commercial
  respectively.
– Countries adopted this system: Japan,
  Korean, France and Germany.
      Taiwan Commercial Law
Civil Code: Book II Obligation                 Section 16 Carriage
 – Chapter I General Provisions                Section 17 Forwarding Agency
                                               Section 18 Partnership
 – Chapter II Particular Kinds of
   Obligations                                 Section 19 Silent Partnership
                                               Section 20 Security Payable by
        Section 1 Sales                        an Assigned Person
        Section 2 Exchange                     Section 21 Securities Payable to
        Section 3 Mutual Account               Bearer
        Section 5 Lease                        Section 24 Suretyship
        Section 6 Loan (for use & for          Section 24-1 Employment
        consumption)                           Suretyship
        Section 8 Contract for Work     Company Law
        Section 8-1 Travel
        Section 9 Publication           Law of Bills and Notes
        Section 10 Mandate              Insurance Law
        Section 11 Manager and          Maritime Commerce Law
        Commercial Agents
        Section 12 Brokerage            Commercial Register Law
        Section 13 Commission Agency
        Section 14 Deposit
        Section 15 Warehousing
Japan and Korea Commercial Code
Japan Commercial Code                Korea Commercial Code
– Chapter I General Provisions       – Chapter I General Provisions
– Chapter II Companies               – Chapter II Commercial Acts
– Chapter III Commercial Acts              Section 1 General Provisions
      Section 1 General Provisions         Section 2 Sale
      Section 2 Sale                       Section 3 Mutual Account
      Section 3 Mutual Account             Section 4 Silent Partnership
      Section 4 Silent Partnership         Section 5 Commercial Agents
      Section 5 Brokerage                  Section 6 Brokerage
      Section 6 Commission                 Section 7 Commission
      Agency                               Agency
      Section 7 Forwarding Agency          Section 8 Forwarding Agency
      Section 8 Carriage                   Section 9 Carriage
      Section 9 Deposit                    Section10 Public
      Section 10 Insurance                 Entertainment Business
                                           Section 11 Warehousing
– Chapter IV Maritime
  Commerce                           – Chapter III Companies
                                     – Chapter IV Insurance
                                     – Chapter V Maritime
                                       Commerce
A case to show analogous application of statute

W drove his car without following the traffic
light and hit X to death. X’s son, Y,
suffered emotional distress after lost his
beloved father. Six months later, Y died
with sad sentiment. Y’s wife, Z, launches a
suit against W to claim damage for Y’s
emotional distress in the name of Y’s heir.
What result?
                      The rules
ROC Civil Code Article 194
In case of death caused by a wrongful act, the father, mother, sons,
daughters and spouse of the deceased may claim for a reasonable
compensation in money even if such injury is not a purely pecuniary
loss.

ROC Civil Code Article 195
If a person has wrongfully damaged to the body, health, reputation,
liberty, credit, privacy or chastity of another, or to another’s
personality in a severe way, the injured person may claim a
reasonable compensation in money even if such injury is not a
purely pecuniary loss. If it was reputation that has been damaged,
the injured person may also claim the taking of proper measures for
the rehabilitation of his reputation.
The claim of the preceding paragraph shall not be transferred or
inherited, except a claim for compensation in money has been
promised by contract or has been commenced.
          Analogous Logic
If p, then q.
– p has attributes of a, b, c, and d.
– r has attributes of a, b, c, and e.
– a, b, c are essential elements to be q.
Then, if r, then q
If a right to claim a reasonable compensation in
money for non-pecuniary loss arises from
wrongful damage to the body, health, reputation,
liberty, credit, and privacy, the claim shall not be
transferred or inherited.
– Such a right is to compensate emotional distress
  arising from the infliction of the right of personality.
– The right in Art. 194 is to compensate emotional
  distress arising from the infliction of the right of
  personality as well.
Therefore, in case of death caused by a
wrongful act, the father, mother, sons, daughters
and spouse of the deceased may claim for a
reasonable compensation in money even if such
injury is not a purely pecuniary loss, the claim
shall not be transferred or inherited.
The Diagram of Legal Methodology of Civil Law




                                 The
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                              Principles
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                                                  Statute
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