In civil legal relations, the parties shall perform the obligations agreed in the contract. However, there will always be accidents in life that make one or both parties unable to fulfill the contract. In the face of the situation of inability to perform, what are the provisions of China's law? How should the parties respond? This article will answer for you.
1. The concept and classification of impossibility.
Failure to perform refers to the inability of the parties to the contract to perform their contractual obligations due to force majeure, accidents or other reasons that cannot be attributed to both parties. The impossibility of performance can be divided into absolute impossibility and relative impossibility.
1.Absolutely not: It means that the subject matter or service of the contract objectively no longer exists, or the basic conditions on which the performance of the contract depends no longer exists, such as the damage or loss of the subject matter.
2.Relative inability: It means that although the parties to the contract can perform their contractual obligations, they need to pay excessive costs, such as delayed performance or partial performance.
2. Legal responsibilities and measures for failure to perform.
1.Termination of the contract: When the performance of the contract is not possible, the parties may negotiate to terminate the contract. After the termination of the contract, both parties shall settle the price and expenses of the part that has been performed, and refund the price of the part that has not been performed.
2.Reduction or exemption of liability: If performance is impossible due to force majeure or unexpected events, the liability of the parties shall be reduced or exempted according to the circumstances. However, if the parties delay performance or partially perform and cause impossibility, they still need to bear corresponding liabilities.
3.Compensation for losses: If a party is unable to cause losses to the other party due to performance, it shall compensate for the losses. The amount of compensation for losses can be determined according to factors such as the performance of the contract and the degree of fault of the parties.
4.Continued performance: When the performance of the contract cannot be rescinded or exempted from liability, the parties shall continue to perform the contract. If one party has paid part of the price, the other party shall refund the remaining price; If one party has provided part of the service, the other party shall pay the corresponding fee.
5.Take remedial measures: The parties may negotiate to take remedial measures to mitigate the losses caused by the impossibility of performance. Such as changing the subject matter, adjusting the performance period, etc.
3. Suggestions on responding to inability to perform.
1.Fully understand the terms of the contract: When signing the contract, the parties should understand the terms of the contract in detail and clarify the rights and obligations of both parties.
2.Risk assessment and prevention: The parties should assess the risks that may arise during the performance of the contract and take preventive measures. Such as insurance, set aside a certain period of performance, etc.
3.Timely communication: During the performance of the contract, the parties should maintain communication, and in the event of failure to perform, they should negotiate and resolve it in a timely manner.
4.Hire a professional lawyer: The parties can hire a professional lawyer to provide legal advice to ensure that their rights and interests are protected in accordance with the law if performance is not possible.
Juzhong Fame Legal Network reminds that performance cannot be a common situation in the process of contract performance. In the face of the inability to perform, the parties should fully understand the legal provisions and take appropriate measures to mitigate losses and ensure their own rights and interests. At the same time, strengthening contract management and preventing and resolving risks is the key to avoiding the problem of failure to perform.