Referring to a contract is to talk about the validity of the contract, the performance of the contract, and the legal responsibility of the parties when breaching the contract. However, in some cases, the breaching party does not have to bear the adverse consequences due to the application of commercial sanctions, which are cases of exemption from liability for breach of contract. So, which cases are exempt from liability when violating commercial contracts?
Let’s find out with Lawyer X through the following article:
Legal grounds
– Commercial Law 2005
Consulting content
The basis for application of liability for breach of commercial contract
– Firstly, there is a breach of contract, this is the legal basis to apply to all forms of sanctions for breach of contract.
– Secondly, there is actual material damage that occurs, which is damage caused by a breach of a commercial contract, which is a mandatory basis when applying compensation for damage.
– Thirdly, there is a causal relationship between the breach of contract and actual damages. The offending party will only have to pay damages; when the damage occurs with the inevitable cause of a breach of contract.
– Fourthly, there is the fault of the violating party, this is a form to determine whether the fault of the violating party is a mandatory basis to consider what form of sanctions will be applied to the violating party. However; because the error is a psychological state; and human perception of behavior; so the identification of errors in commercial contracts – a type of contract; in which the majority of the contract subjects are organizations; therefore; need to consider the level of error based on the agent factor.
Case of exemption from liability for breach of commercial contract
According to Clause 1, Article 294 of the 2005 Commercial Law, cases of exemption from liability for acts of breach of contract in commerce include:
– As agreed by the parties
– Cases due to force majeure events
– Where the breach of one party is due to the fault of the other party
– In case of violation due to compliance with a decision of a competent state management agency that the parties could not know at the time of entering into the contract.
The meaning of exemption from liability for breach of commercial contract
The regulation of cases of exemption from liability for violations in commercial contracts is very important in ensuring the interests of the parties when entering into a commercial contract relationship.
First of all, it is to respect the voluntary will of the parties when the parties themselves agree on the exemption from liability in the contract.
In addition, fair protection and interests of the subject party are violated when for objective reasons lead to a breach of the obligations agreed in the contract, and at the same time contribute to regulating the interests, protecting legitimate rights and interests of the parties in the commercial contractual relationship and contribute to ensuring the orderly operation of the economy.
For example, More than 7 billion VND is the damage that the households of apartment C6, My Dinh 1 urban area; suffered due to flooding of the garage during the historic flood in November 2008. The “legal battle” broke out between the people whose cars were parked in the basement of the apartment complex, which was flooded with water causing serious damage; the investor side thinks that it is a force majeure event (specified in the contract); should not compensate, and the customer side thinks that they must be notified to get the car out of the parking garage. However, the customers suffered… lost; because the investor has proven that this is a force majeure event, unintended.
Purpose of the disclaimer
Through the provisions in the case of liability exemption when there is a breach of contract in the case of; It can be seen that the law respects the parties’ right to freely agree to a contractual relationship; if it is not against the law. At the same time; this self-agreement; although not foreseeing all the circumstances, partly helps the parties to voluntarily comply with the contract; without the need to apply sanctions.
The regulation of force majeure events has shown the extent of the law’s coverage of cases; at the same time transparency and accuracy; fairness to the cases; that the fault of the violator has been eliminated. Thereby, ensuring the interests of the parties in the commercial contract.
Regarding the case: the violation of one party is entirely at the fault of the other party; granting its holders the right to be treated fairly. When one party fails to perform its obligations, the other party also has that right. Ensure the right to self-determination and the right equal to the obligations that one has to perform.
Please see more articles:
- Procedures for bidding for goods and services in Vietnam
- Guidelines for drafting the latest company charter 2022 in Vietnam
Frequently asked questions
Regulations on liability for breach of commercial contracts are regulations based on the application of liability, forms of liability, and cases of exemption from liability. These regulations are very meaningful to the protection of the legitimate rights and interests of the subjects in the commercial contract relationship as well as to ensure the strictness of the law.
– Forcible performance of the contract
– Violations
– Forced compensation for damage
– Suspension of contract performance
– Suspension of contract performance
– Cancellation of contract
– Other measures.
Exemption from contractual liability in business and commerce is the fact that the party that violates the obligations under a commercial contract is not legally responsible for the breach of the contract as agreed or prescribed by law.
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