Remedies for breach of contract in the international sale of goods – a comparative study between the CISG, Chinese Law and English law with reference to Chinese cases

Abstract

The United Nations Convention on Contracts for the International Sale of Goods (CISG) is one of the most successful international instruments that provide uniformity in the rules for international trade. It has been adopted by seventy-three countries and has been in force for twenty-one years. The People’s Republic of China (PRC) signed the CISG on 30th September 1981 and many international sales of goods cases have been resolved under the CISG in China. The author will investigate these Chinese cases to examine the effectiveness of the CISG in order to establish whether the application of the CISG has been successful in leading to predictable judgments. This thesis focuses on remedies for breach of contract in the international sale of goods. Remedies are the main reason why claims are made in the international sale of goods and as such they are fundamental to that trade. The main remedies considered in this thesis are the avoidance of contract, damages and specific performance. In addition, mitigation and the categorisation of the breach of contract are discussed where the former is an important means to restrict the recoverable damages and the latter constitutes the foundation for the study of remedies for breach of contract. Furthermore, the provisions related to the remedial rule of the CISG are those that the Chinese tribunals have applied most in their judgments. Research in this area provides the author with sufficient sources of cases for the examination of the Chinese decisions. Two other alternative national regimes are compared with the CISG to assess the predictability of decisions under these systems. These are the old Chinese law, i.e., the PRC Foreign-Related Economic Contract Law (FECL) and English law, i.e., Sale of Goods Act 1979 (SGA) together with English case law. The FECL was the governing law of the international sale contract before China acceded to the CISG. The SGA is the present statute of English international sale contract law. The similarities and differences of the remedial rules between the CISG, FECL and English law are compared in this thesis. Analysis of the Chinese cases tried under the rules of the CISG shows that the outcomes of these cases are not predictable. The author will apply the remedial rules of the FECL and English law to the Chinese cases examined here to find out whether the application of either of these two alternative regimes could have led to outcomes that are more predictable. The conclusion of this thesis summarizes the results of the author’s examination with regard to the Chinese tribunals’ difficulties in making predictable judgments, the causes of difficulty where judgments have been unpredictable and the author’s proposals as to how to resolve such difficulties

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