A Study on the Legal Character of Contractual Liability in Freight Agency under Chinese Contract Law

중국계약법상 화물운송대리에서의 계약책임과 귀책원칙

Generally, the liability for breach is defined as the civil liability that arises from the conduct of violation of a contract. There are two notable principles governing liability for breach that have fundamental impacts on the unified Contract Law of the People's Republic of China (hereinafter Chinese Contract Law) in the remedies. In China, during the drafting of the Contract Law, there was a great debate as to whether damages for breach of contract ought to follow the fault principle or to follow the strict liability principle. Ultimately the Chinese Contract Law follows the model of the CISG on this point, namely, it follows the strict liability principle (article 107) with an exemption cause of force majeure. Under Chinese Contract Law, it is interpreted as strict liability in principle. Strict Liability is a notion introduced into Chinese Contract Law from the Anglo-Saxon Law. The strict liability or no fault doctrine, on the contrary, allows a party to claim damages if the other party fails to fulfill his contractual obligations regardless of the fault of the failing party. Pursuant to the strict liability doctrine, if the performance of a contract is due, any non-performance will constitute a breach and the fault on the party in breach is irrelevant. This paper reviews problems of legal character or legal ground of contractual liability in Chinese contract law. Specifically, focusing on the interpretation of Chinese contract law sections and analysis of three cases related contractual liability in freight agency, the paper proposes some implications of structural features of Chinese contract law and international commercial transactions.