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Published online by Cambridge University Press: 17 February 2009
It should not be difficult to understand that even if the device known as a “contract” in China is not a contract in the Western sense in terms of the descriptive definition offered at the beginning of the first part of this article, it may still perform some of the functions that contracts perform in the West. Further, in order to perform those functions it may be necessary that rules—laws—be adopted for purposes of efficiency and administrative convenience.
146 See below.
147 While there are compilations of decrees, etc., there does not appear to be a comprehensive compilation of all relevant decrees on any topic. Moreover, it is not unlikely that many important laws are not published.
148 See note 25 in Part. I.
149 Aside from the usual danger inherent in relying on any single source, there are additional dangers at this time in relying on a source produced by the Chinese government and relating to the civil law. First, it may be merely propaganda. Second, even if it is not merely propaganda, lack of trained personnel to apply policies stated in the source may make it a nullity in effect. Third, in any event, the régime is still pressing the revolution and may not be willing to subject itself to law, and it may be said that on no account is it willing to adhere for long to any unchanging set of laws. Fourth, the law set forth in the source appears to be merely a carbon copy of Russian law, not something the régime has developed itself and, therefore, not something to which it has a strong commitment.
The facts suggest that while these dangers do exist they are not sufficient to preclude substantial reliance on this source for purposes of reaching tentative conclusions.
It appears unlikely that The Book was compiled and published merely for the ends of propaganda. The Book purports to have been compiled from a series of lectures given in early 1957 to students—prospective political-judicial cadres—at the Institute of Civil Law, Central Political-Judicial Cadres' School. It was revised and published in 1958 purportedly as “a reference for incumbent political-judicial cadres …” The Book, p. 7.Google Scholar
Thus, The Book appears to have been written as a practical handbook to guide the enforcement of state policies throughout the country. In view of the strategic importance assigned to the training of cadres and their role in implementing the policies of the regime, it is highly improbable, accepting the purported purpose of The Book, that it is mere propaganda. And, since the need for better-trained cadres has been acknowledged repeatedly by the régime, the publication of this book seems in fact to have been designed to answer that need.
The second danger—that the book will have no practical significance because of the lack of trained personnel to execute its policies—is a real one. However, this lack of trained personnel in China is not confined to the administration of law, and one might as well in earlier years have refrained from speaking of the role of statistical analysis for the same reason. Although the lack of such personnel will impede execution initially, it is likely that the situation will improve, as it already has in the realm of statistics. Moreover, the fact that the régime supports these policies has great importance without regard to their immediate effect in practice.
The third danger can be virtually discounted in light of the Russian and early Chinese experience. While it is clear that in the near future law will not assume the importance it has in the Occident, it is also clear that it has and increasingly will continue to perform necessary functions for the régime. As suggested above, the question of ultimate subjection of the régime to the rule of law will not arise in the ordinary cases, and in this sphere the role of law will be vital. The Communists' experiences have illustrated that law can be used to implement the goals of the revolution, particularly to realise the goals of economic planning. Although the specifics of “contract” law may be modified as the context changes, it is probable that set in the context of economic planning, the broad policies will remain relatively constant.
Finally, the fact that the law presented in The Book for the most part is merely a transplanting of Russian law makes it more, not less, likely that the régime is strongly committed to it. The régime, having previously adopted the Russian model for economic development, will almost certainly utilise the Russian experience in pressing that development. It should be emphasised that the Chinese Communists have adopted Russian law as it developed under economic planning, not simply as it appears in the 1922 Code. Of course, the Chinese régime will continue to mould its own actions to fit conditions in China, but unless it rejects the fundamentals of the Russian model it is unlikely to reject the Russian experience.
This common-sensical inference is buttressed by the ideological commitment to the proposition that law is a reflection of economic conditions, that economic conditions require overall economic planning and, therefore, that law should reflect the needs of economic planning. Moreover, the Chinese have not accepted Russian law in every detail. The existence of a degree of selectivity indicates that the adoption of Russian law manifests a conscious commitment.
150 See Gsovski, , Vladimir, , Soviet Civil Law (Ann Arbor: Un. of Michigan Law School, 1948), I, pp. 15–235Google Scholar, for a translation of the 1922 Code. It should be noted that technically it is a misnomer to call this Code the Russian or Soviet Civil Code. As Gsovski points out in this volume, pp. 4–6, this Code is the Code of one of the Republics, the R.S.F.S.R., of the Soviet Union. And, while many of the other republics have copied this Code verbatim or with only minor changes, there appears to be no all-union code. In this latter connection see also Berman, , “Soviet Law Reform,” op. cit., pp. 1199–1202.Google Scholar
151 For excerpts from the German Civil Code (BGB) of 1900 see von Mehren, , The Civil Law System (Englewood Cliffs: Prentice-Hall, 1957), Appendix B, pp. 874–899.Google Scholar It should be noted that the laws of the Republic of China were also strongly influenced by German laws and -therefore are quite similar in this respect. The possible relationship between Republican and Communist law is however not explored in this article.
152 Gsovski, , Soviet Civil Law, I, p. 415.Google Scholar
153 The Book, pp. 37–116.Google Scholar
154 Ibid. pp. 117–175.
155 Ibid. pp. 176–199.
156 Ibid. pp. 215–324.
157 ibid. pp. 45, 69–72, 176 et seq.
160 See ibid. pp. 180–182 for a discussion of these three sources of obligations.
161 See excerpts quoted in von Mehren, , The Civil Law System, op cit., pp. 463–464.Google Scholar
162 Idem.
163 Gsovski, , Soviet Civil Law, 1, op. cit., p. 424.Google Scholar
164 With regard to both German and French law see von Mehren, , “Civil Law Analogues to Consideration: An Exercise in Comparative Analysis,” Harvard Law Review, LXXII, p. 1009.Google Scholar
165 In light of the discussion in von Mehren, ibid., it appears, for example, that the evidentiary and cautionary functions of consideration as a formality in effect are performed by direct formal requirements. In this regard see Gsovski, , Soviet Civil Law, 1, pp. 431–432.Google Scholar With respect to the function of screening individual transactions for unfairness see Gsovski, ibid. p. 425, with reference to the right of avoidance in situations where a party “under the pressure of distress” has entered a contract “clearly unprofitable to him.”
166 The function of consideration at common law to screen individual transactions for gross unfairness is performed by a direct right to redress in Chinese law. See below, p. 135, for reference to the right of an oppressed party to avoid a contract that is obviously unfair if that party was in an unfair bargaining position when he concluded the “contract.”
167 The Book, p. 204.Google Scholar
168 Ibid. pp. 204–208; and for a brief discussion of the comparative practice of “freedom of contract” in Western and Soviet law see Herman, , The Nature and Functions of Law (Brooklyn: Foundation Press, 1958)Google Scholar, Part III, particularly pp. 93–96.
169 See below.
170 The Book, p. 203.Google Scholar
171 Ibid. pp. 203–204.
172 BGB, Articles 145–148Google Scholar, translated in von Mehren, , The Civil Law System, p. 881.Google Scholar
174 Ibid. pp. 492–493, discussing the impact of the rules regarding offer and acceptance in the common law, French law and German law.
175 The Russian Civil Code, sections 132–135, translated in Gsovski, , Soviet Civil Law, II, pp. 111–112.Google Scholar
176 The Book, pp. 180 and 236.Google Scholar
177 Ibid. p. 213.
178 Yang and Li, “Apply the Contract System,” op. cit.
179 See discussion in von Mehren, , The Civil Law System, op. cit., pp. 472–473.Google Scholar
180 Restatement of the Law of Contracts (St. Paul: American Law Institute Publishers, Student ed., 1933)Google Scholar, sec. 12 and comments thereto.
181 The Book, pp. 258 and 282–283.Google Scholar
182 Restatement, sec. 45.Google Scholar
183 See note 181.
184 The Book, p. 281.Google Scholar
185 For example, see below for reference to limitation of a carrier's liability for breach of contract.
186 von Mehren, , The Civil Law System, p. 473.Google Scholar
187 The Book, p. 211.Google Scholar It is interesting to note that the reasoning in the section of The Book, dealing with terms of contracts, pp. 208–211, is not unlike that in the famous common law cases of Scammell v. Ouston, in the House of Lords [1941] 1 All E.R. 14, and Foley v. Classique Coaches, Ltd. [1934] 2 K.B. 1, appearing in Fuller, , Basic Contract Law (St. Paul: West Publishing Co., 1947), pp. 76 and 81 respectively.Google Scholar
188 The Book, pp. 200–213.Google Scholar
189 Idem; for a brief discussion of “the basic conditions of supply” in Russia, see Berman, , Justice, op. cit., p. 71Google Scholar; and see Berman, , “Commercial Contracts,” op. cit., pp. 201–202.Google Scholar
190 The Book, pp. 227–232.Google Scholar
191 Ibid. p. 234.
192 Ibid. p. 201; see below for a discussion of penalties.
193 Ibid. p. 80.
194 The Russian Civil Code, section 137 (a), translated in Gsovski, , Soviet Civil Law, II. op. cit., p. 112.Google Scholar
196 The Book, p. 316.Google Scholar
197 Ibid. pp. 79 and 213–214.
198 Ibid. pp. 278 and 80.
199 The Marriage Law of the People's Republic of China, Article 6, translated in Yang, C. K., The Chinese Family in the Communist Revolution (Cambridge: Technology Press, 1959), p. 222.Google Scholar
200 The Book, pp. 80–81.Google Scholar
201 Berman, , “Commercial Contracts,” op. cit., p. 210.Google Scholar
202 Gsovski, , Soviet Civil Law, I, p. 425.Google Scholar
203 For a brief discussion of uniqueness and specific performance at common law, see Fuller, , Basic Contract Law, op. cit., pp. 27–31.Google Scholar
204 See Berman, , Nature and Functions, op. cit., p. 390et seq.Google Scholar
205 Restatement, op. cit., sec. 358 et seq.
206 Ibid. sec. 347.
207 Ibid. sec. 275.
208 See below.
209 See discussion in von Mehren, , The Civil Law System, op. cit., pp. 501–505.Google Scholar
210 For example, by the mid-1930s Mao had evolved a strategy whose basic features, at least by implication, were opposed to important features of Marxism-Leninism. For a fine and detailed discussion of this see Schwartz, Benjamin I., Chinese Communism and the Rise of Mao (Cambridge: Harvard Un. Press, 1958), particularly pp. 189–204.Google Scholar
211 The Book, pp. 180–181.Google Scholar
212 Ibid. pp. 180 and 236.
213 For example, ibid. p. 281.
214 See above.
215 The Book, pp. 234–237.Google Scholar
216 Idem.; for a brief discussion of general, local and direct contracts in Soviet law see Gsovski, and Grzybowski, , Government, Law and Courts in the Soviet Union and Eastern Europe (New York: Praeger, 1959), II, pp. 1149–1150.Google Scholar
217 The Book, p. 236.Google Scholar It is important to note that it is not clear which administrative organs decide such disputes. So long as the disputes are between enterprises that are under the same specialised industrial company or the same ministry, the problem of which organ decides is relatively unimportant. However, since there is no public arbitration organ in China comparable to Gosarbitrazh in Russia (see The Book, p. 214Google Scholar; and see Berman, , Justice, op. cit., p. 63et seq.)Google Scholar, it is uncertain how disputes between enterprises under different ministries will be settled where the ministries themselves are unable to agree. It seems unlikely that the State Council, the only executive body above the ministries, would take the trouble to settle all such disputes itself.
218 The Book, p. 228.Google Scholar
219 Ibid. p. 241.
220 Ibid. pp. 242–244 and 191.
221 Ibid. pp. 231–232.
222 Zile, Z. L., Remedies for Breach of Contractual Obligations in Soviet Law (Student Paper, Harvard Law School, Comparative Legal Research, 1960), p. 14.Google Scholar
223 The Book, pp. 321–332.Google Scholar
224 Ibid. p. 240.
225 Ibid. p. 185.
226 Ibid. pp. 240–241.
227 Idem.
228 Zile, , Remedies, op. cit., pp. 12–13.Google Scholar
229 The Book, p. 193.Google Scholar
230 Ibid. pp. 192–193.
231 Idem.
232 Ibid. p. 241.
233 Ibid. p. 193.
234 Ibid. pp. 185–187; see below for discussion of “contractual”; “fault”; force majeure; and impossibility.
235 See discussion in The Book, p. 202.Google Scholar
236 Mihaly, , “The Role of Civil Law Institutions,” op. cit., pp. 323–324.Google Scholar
237 The Book, pp. 193–194.Google Scholar
238 Idem.
239 Zile, , Remedies, p. 38.Google Scholar
240 The Book, p. 193.Google Scholar
241 This notion is suggested with regard to the parallel Russian law in Zile, , Remedies, pp. 38–39.Google Scholar
242 The Book, p. 193.Google Scholar
243 Restatement, op. cit., sec. 339.
244 The Book, pp. 186–189Google Scholar
245 Ibid. p. 241.
246 Ibid. p. 185.
247 Ibid. p. 326.
248 With regard to the emphasis on “Law as a Teacher and Parent” in Russia, see Bennan, , Justice, op. cit., pp. 203–206et seq.Google Scholar
249 Under the expectancy measure, “The law attempts to put the plaintiff in as good a position as he would have occupied had the defendant performed his obligation.” von Mehren, , The Civil Law System, op. cit., p. 507Google Scholar; and see Restatement, op. cit., sec. 329 et seq.
250 The Book, p. 187.Google Scholar
251 See generally Fuller, and Perdue, , “The Reliance Interest in Contract Damages”, 1, 46Google ScholarYale Law Journal, I, p. 52.Google Scholar
252 The Book, p. 187.Google Scholar
253 Ibid. p. 188.
254 Ibid. pp. 188 and 335.
255 Zile, , Remedies, op. cit., p. 54.Google Scholar
256 See The Book, pp. 188 and 335.Google Scholar
257 The Book, p. 290.Google Scholar
258 Ibid. pp. 91, 196 and 340.
259 Ibid. pp. 185–187.
260 For the definition and rules regarding impossibility at common law see Restatement, sec. 454 et seq.
261 Such a conclusion does not seem unreasonable under the terms of ibid. sec. 460, particularly illustration No. 12 in the comments thereto.
262 Berman, , “Force Majeure and the Denial of an Export Licence under Soviet Law: A Comment on Jordan Investments, Ltd. v. Saiuznejteksport,” Harvard Law Review, LXXIII, p. 1128.Google Scholar
263 The Book, p. 238.Google Scholar
264 Ibid. pp. 84–87.
265 BGB, Article 138Google Scholar, translated in von Mehren, , The Civil Law System, p. 881.Google Scholar
266 The Book, pp. 87–88.Google Scholar
267 Idem.
268 Ibid. pp. 83–84.
269 Ibid. p. 83.
270 See Gsovski, and Grzybowski, , Government, Law and Courts, op. cit., pp. 1140–1144.Google Scholar
271 The Book, pp. 88–91.Google Scholar
272 Idem.
273 See discussion in Gsovski, , Soviet Civil Law, I, op. cit., pp. 426–431Google Scholar; and see Berman, , “Commercial Contracts,” op. cit., pp. 211–212.Google Scholar
274 Gsovski, , Soviet Civil Law, I, p. 426.Google Scholar
275 See above.
276 See note 273.
