During the Spring and Autumn Period and the Warring States Period, there was a famous doctor named Bian Que, and any incurable disease could be cured in his hands. King Wen of Wei once asked Bian Que, "Your three brothers are all good at medical skills. Which medical skill is the highest? " Bian Que replied: "The eldest brother is the best, the second brother is the second, and I am the worst." King Wen asked again, "Then why are you the most famous?"
Bian Que replied, "Eldest brother treated the disease before he got sick. He can find clues and root out the root of the disease in time before our family has symptoms, so no matter how high his medical skill is, his reputation will not spread, only our family knows; Second brother cured the disease at the early stage of the disease. He can always find and prescribe the right medicine in time when the patient has just started to get sick, so that the condition can be effectively controlled. Everyone knows that he can cure minor ailments, so he is famous in our village. And I also treat diseases when I am seriously ill. Most people see my major operations such as pricking blood on meridians and applying drugs on the skin, so I think my medical skills are the best, so my reputation is famous all over the country. "
Bian Que also said: "I will only cure the serious illness after the patient's condition worsens. In essence, it's not as good as my second brother's medical skill, because I didn't find the patient's physical disharmony in time, or I cured the patient when he was still in a minor illness. The patient went through a lot of pain. Although he is famous all over the world, he has made the least contribution to protecting the health of patients. "
Litigation is a relief measure afterwards, and the cost and risk of relief afterwards are much higher than that of prevention and control beforehand, such as time cost, opportunity cost and execution risk.
The brief analysis of the main points of this contract is based on the structure of the sales contract ("the mother of the contract"), which is divided into six parts: contract header, text, supplementary terms, annex, tail and matters needing attention when signing.
Brief analysis.
For the modification of the contract, four folders can be established, including the original manuscript folder, the revised manuscript folder (there can be multiple folders), the sent manuscript folder (there can be multiple folders) and the signed manuscript folder, so as to prevent the later manuscript from overwriting the previous manuscript.
★: Key audit targets
I. The first part of the contract
(a) the nature of the trial ★
Check whether the nature of the contract is accurately defined. The name of the contract shall be consistent with the contents of the contract text.
If the nature of the contract cannot be determined, it can be named as agreement, cooperation agreement or contract, cooperation contract, etc. If it belongs to a famous contract or some keywords in the contract can play a role in determining the nature of the contract, this keyword can be appropriately added to the "name" of the contract to reflect the nature of the contract.
Note: Sometimes a contract may contain multiple legal (contract) relationships, which need to be paid attention to and investigated separately.
(2) Review "quantity"
For those who use our template, numbering the contracts is helpful for us to file the contracts and quote them in other contracts and documents.
(iii) Review the "theme" ★
Check whether we, the other party and the third party involved have full capacity for civil conduct, and whether they have (special industries) stipulated by laws and regulations, and check the annual inspection, business scope and mode of operation of the contract subject.
Relevant circumstances affecting this contract. Please note that relevant qualifications cannot be borrowed or shared among enterprises in an enterprise group. If necessary, you can conduct relevant investigations by yourself or entrust an intermediary agency.
In addition, in the main terms, telephone number, fax number, e-mail address, etc. Both parties may agree that the name of the natural person shall be the name on the resident identity card.
(iv) Review "Purpose"
Generally speaking, the purpose of the contract includes: 1, understanding the contents of the contract according to the purpose of the contract; 2. Require the other party to perform its obligations according to the purpose of the contract; 3. Exercise the right of defense or rescission according to the purpose of the contract; 4. Exercise the right of appeal according to the purpose of the contract.
In the introduction part, the purpose of the contract can be expounded. If the purpose of the contract is agreed, when there is a dispute over the interpretation of the terms, the court will interpret it with reference to the purpose of the contract; When one party breaches the contract, the court evaluates the foreseeable loss of the other party according to the purpose of the contract. Of course, reaching an agreement on the purpose of the contract may lead to the disclosure of trade secrets. Even if it can be stipulated in the contract that both parties keep the transaction confidential, it can't prevent the possibility of leakage. Once leaked, it may make us suffer losses. Therefore, whether to agree on the specific purpose of the contract needs to be considered in combination with the familiarity of both parties to the transaction and the reputation of the other party.
The purpose of a contract can often be determined from the nature of the contract, but the core purpose of the contract, that is, the true intention of the parties to the contract, is often clear to only one party, and often only one party is clear. If the contract is directly reviewed without knowing the real intention of the parties, the results of the review will often make the client dissatisfied.
In addition, when reviewing the purpose of the contract, we need to know the background of signing the contract, such as the bottom line of the other party's transaction and the comparison between the other party and us.
Second, the contract text
(a) the trial "meaning" ★
Check whether the meaning is correct. When auditing, we should pay attention to the following aspects:
1. Whether the disposition of the subject matter of the contract is restricted by the consent of the internal decision-making body stipulated or agreed in the articles of association or partnership agreement of the other party;
2. Whether the transactions agreed in the contract belong to related party transactions, and if so, whether they are restricted by related party transactions:
(1) Partnership:
Limited partnership: a limited partner may conduct transactions with this limited partnership; However, unless otherwise agreed in the partnership agreement.
General partnership: Unless otherwise agreed in the partnership agreement or unanimously agreed by all partners, the partners may not conduct transactions with this partnership.
(2) Company: Directors and senior managers violate the articles of association of the company or enter into contracts or transactions with the company without the consent of the shareholders' meeting or the shareholders' meeting.
3. Whether the contract has passed the corresponding administrative license, registration or filing before signing.
(2) Examine the "theme" ★
1. Check whether the contract object is legal.
The object of contract is the same direction of contract rights and obligations. The subject matter of the contract can best reflect the nature and purpose of the contract, so the examination of the subject matter of the contract is very important to realize the true meaning of the parties.
(1) Whether the transaction of the subject matter of the contract is in a restricted state, such as whether it is a subject matter whose circulation is prohibited or restricted by national laws and administrative regulations, and whether it has obtained the ownership of * * * *.
Or obtain the consent of an interested third party, such as the priority party, or notify the third party;
(2) The description of "composition (object)" should not be vague or ambiguous, otherwise there will be disputes in the future due to the ambiguity of the contract object. In order to clarify the subject matter of the contract, it can be described from the social and natural attributes (physics, chemistry, biology) of the subject matter.
2. Quantity and quality, acceptance criteria or requirements
(1) The unit of measurement for the quantity and quality of the subject matter of the contract shall be the international common unit. Remember not to use vague measurement concepts such as a pile, a bag, a car, a bundle, a box, etc. in the quantity clause.
(2) The acceptance criteria of the contract shall be clearly defined. For example, it can be defined by relevant standards such as qualified sample storage and compliance with EU RoHS directive.
3. If the object is service, it is necessary to check whether the service personnel have the corresponding professional qualifications.
(3) the "mode" of trial
Review whether the contract needs to be concluded by special means such as bidding, auction and listing. For example, large-scale construction projects, municipal facilities, transfer of state-owned assets, acquisition of listed companies and government procurement may all involve special contracting methods.
Review of the Framework
Check whether there are necessary review points in the review points of this contract.
Blue font: mandatory terms;
Purple font: optional clause.
(5) Review "Submission" ★
1. Packing:
It can be agreed that "the packaging of the goods by the seller should meet the requirements of transportation distance, shock resistance, moisture resistance, rust prevention, breakage prevention and loading and unloading before shipment, so as to ensure that the goods can be safely transported to the place designated by the buyer".
2. Transportation:
(1) Make clear whether the location, delivery place and delivery place of the subject matter are clear.
(2) Make clear the mode of transportation and freight bearing.
(vi) Review of "payments" ★
Check whether there is currency (in foreign-related contracts, it is necessary to specify which currency is used as the payment content, and if it is foreign currency, it is also necessary to specify the proportional relationship between the quotation of this currency and RMB on which day to prevent wrangling during performance), unit price, total price and price composition (including but not limited to transportation fees, storage fees, handling fees, insurance fees, customs clearance fees, etc.). ), payment methods, payment procedures, accounts, etc. Are very clear; In particular, it is necessary to clarify the burden of insurance, tax and withholding fees.
(vii) Review of "rights"
1. Check whether the rights are balanced, reasonable and without omission (you need to check certain background information in combination with the pertinence of the contract), and pay special attention to whether the main rights are excluded by the other party and whether the relevant waiver or exemption clauses are legal and reasonable.
2. In order to prevent one-sided contractual rights from forming overlord clauses or overlord contracts, the court may, upon the application of the parties, determine that the clauses and contracts are invalid.
(viii) Review of "obligations"
1. Check whether the obligations and responsibilities are balanced, reasonable and without omission, and need special leave.
Whether the obligation is achieved by the other party's ability;
2. It is necessary to clarify the transaction procedures of both parties and the order in which both parties perform their obligations.
Note: Whether the installation, debugging, initial inspection, trial operation, final inspection, training terms (training fees, training contents) and warranty terms are clear.
(9) Review "Degree" ★
Reduce the use of adverbs of degree such as "extreme", "more", "huge", "significant" and "larger", and try to make the agreement specific and clear.
(10) Examining "Special"
1. Review whether the exclusions and exceptions in the contract are legal and fair;
2. Review the transfer and inheritance of contractual rights and obligations.
(eleven) review the "risk" ★
Consult relevant professionals to see if there are unreasonable or even uncontrollable non-legal risks in the contract and see if the risk prevention measures taken in the contract are effective.
(12) review "dissolution and termination"
Although the Contract Law stipulates the conditions for legal dissolution and termination, we can try our best to predict the reasons that may lead to the dissolution and termination of the contract in advance and make an agreement.
(thirteen) to review the confidentiality and intellectual property rights.
The review of this clause can refer to the relevant internal system of the unit.
(fourteen) review the "necessary measures and guarantees"
Depending on the status of both parties and the size of the subject matter, performance bond and security interest can be stipulated in the contract to ensure the smooth performance of the contract.
If the other party needs to provide a guarantee, it needs to sign a guarantee contract with the relevant customer.
It is necessary to clearly express the intention of the guarantor to provide guarantee for the performance of the debt, and avoid using vague expressions such as "responsible for solving" and "responsible for coordinating" of the other party, otherwise the court cannot determine that the guarantee contract is established.
If the other party needs to provide mortgage guarantee, it shall immediately go through the registration formalities with the relevant registration authority when signing the mortgage contract. Only the mortgage contract without going through the registration formalities may make our rights and interests lose the foundation of realization. If the parties delay or refuse to assist in mortgage registration after signing the mortgage contract, they should bring a lawsuit to the court as soon as possible and request the court to go through the compulsory registration procedures.
(15) Review "Default"
1. The establishment of breach of contract clauses, including the conditions that constitute a breach of contract, the exceptional conditions that do not constitute a breach of contract, and the way to bear the liability for breach of contract.
2. When reviewing the liability for breach of contract, we need to pay attention to:
(1) Whether the possible legal risks and non-legal risks are comprehensively predicted;
Non-legal risks include business risks, market risks, financial risks (including exchange rate risks), policy risks, political risks and natural disaster risks.
We can ask the parties to provide some hypothetical situations, and the information provided by the parties will help us find some problems that we may not have considered.
(2) Whether the liability for breach of contract corresponds to the possible risks;
(3) Whether the form of liability for breach of contract is operable and easy to implement;
(4) Whether the liability for breach of contract is enough to recover our economic losses.
3. Forms of liability for breach of contract: There are five basic forms of liability for breach of contract, namely, continuing to perform, taking remedial measures, compensating for losses, paying liquidated damages, and applying deposit penalty.
(sixteen) review the "force majeure and exemption clause"
Review whether the scope of force majeure and exemption clauses is appropriate and fair. Note that it is inappropriate to list government actions as "force majeure".
(seventeen) review the "limitation of liability"
In the contract, you can limit the liability, such as the total amount of compensation for breach of contract or damage.
(18) Inspection of "Validity"
1. Whether the terms and conditions attached to the validity of the contract are appropriate;
2. Whether the laws, regulations or technical specifications cited in the contract are partially or completely invalid;
3. Review whether the contract stipulates that when the legal effect of all or part of the contract is questionable, whether other clauses are invalid or still valid;
4. Whether it is suspected of inter-enterprise lending, monopoly, unfair competition or disguised commercial bribery, and whether it will be invalid because it violates the special supervision policies of banks, securities and trusts;
5. Combined with the above contents, examine whether the contract as a whole can guarantee its effectiveness.
In addition, the terms of the contract are not always valid, and sometimes the terms of the contract provided by the other party or some modified terms are invalid, so long as they do not affect our interests, we can ignore them. Invalid clause, unenforceable clause
(nineteen) review the "contract interpretation"
For foreign-related contracts or contracts with multiple supplementary agreements, contract interpretation clauses should be set: first, which language text shall prevail when the contract clauses conflict; The second is to set the effective order of different texts.
(twenty) the trial of "foreign"
Foreign-related contracts often involve some special legal issues, which need to be reviewed in combination with the General Principles of the Civil Law, the Civil Procedure Law, the Law on the Application of Laws in Foreign-related Civil Relations and other relevant laws, regulations and judicial interpretations.
1. foreigner qualification examination.
If the other party is a foreign enterprise or organization, its subject qualification should be carefully examined, which should include: (1) whether the enterprise or organization exists legally;
(2) whether the enterprise is a limited company or an unlimited company, and whether it has legal personality; (3) Accurate legal name, address, name, nationality and place of registration of legal representative (person in charge).
2. Tax issues
If a foreign enterprise without an institution in China obtains income from equity transfer, dividends, interest, rent and royalties from China, it shall withhold and pay income tax for the foreign enterprise. This tax is borne by foreign enterprises and withheld and remitted by domestic payment units when remitting money abroad. Therefore, it is suggested to write the withholding into the contract, otherwise it will easily lead to conflicts.
(twenty-one) to review the dispute settlement methods, fees and dispute jurisdiction.
1. Whether the dispute settlement method is clear and whether the jurisdiction of litigation or arbitration is invalid; Generally speaking, it should be agreed to be under the jurisdiction of the court, and it should be under the jurisdiction of our local court (especially foreigners and foreign companies).
2. It is generally agreed that the losing party shall bear the reasonable expenses of the other party to realize the creditor's rights, such as attorney's fees, investigation and evidence collection fees, etc.;
3. It is generally agreed that the people's court where the strong party in the transaction is located is the dispute jurisdiction institution, or it is not agreed.
Third, the supplementary terms of the contract
(A) the trial "application of law"
For contracts involving foreign affairs, Hong Kong, Macao and Taiwan, the following agreements can be made:
The Contract shall be governed by the laws of China, that is, laws, legal interpretations, administrative regulations, departmental regulations, judicial interpretations, local regulations, autonomous regulations and separate regulations, local regulations and other normative legal documents with legal effect (excluding laws and regulations formulated or recognized by the legislatures of Hong Kong, Macao and Taiwan).
(2) Review Notice and Delivery ★
1. Examine whether the contact information and mechanism of contract disputes are likely to cause disputes between both parties;
2. The contract may stipulate the special docking personnel and contact information, as well as the receiving and acceptance professionals and contact information of the subject matter of the contract.
(iii) Review of the "Level of Validity between Contracts and Documents"
It may be agreed that "in case of any conflict between this contract and any relevant advertisements, announcements, letters, minutes of meetings, bids, letters of intent and other documents produced before the signing of this contract, this contract shall prevail".
(four) review the "date and validity of the contract"
The contract date includes the signing date and the effective date. The date of signing indicates when the contract was signed. The effective date refers to the year, month and day when the contract takes effect. The effective date indicates the beginning of the contract's effectiveness, and both parties are bound by the contract.
Binding of rights and obligations. Some conditional contracts usually have the effective date of the effective conditions, so the contracts are legally binding.
The validity period of a contract refers to the time period from the legal effect of the contract to the termination of the contract. The term of validity of a contract is not equal to the term of performance of the contract. The validity period of the contract may precede the performance period of the contract, but the termination time must be consistent with the performance period of the contract. The length of validity of the contract agreed by the parties shall be determined according to the provisions of the law and the actual situation of the subject matter of the contract.
(5) Investigate "Ci"
Check whether the words are accurate, whether the unit is standardized, whether the figures are accurate, whether there are typos, whether the words are ambiguous, and whether the contract typesetting is beautiful and concise.
When you first use a term, you need to define it. It is suggested to define the term when it first appears, so that readers can better understand the contract.
Please refer to the standards or regulations such as Format of Official Documents of State Administrative Organs and Measures for Handling Official Documents of State Administrative Organs for the review of contract typesetting.
(6) Review "notarization"
If the contract needs notarization, the notarization clause shall be clearly stipulated in the contract. Major contracts can obtain legal effect through notarization, thus avoiding or reducing economic losses.
(seven) review the "clean text"
It is suggested to state in the contract: "The text of this contract is a clean printed text. If this contract is amended or supplemented, both parties shall sign a supplementary agreement separately. Unless confirmed and agreed by both parties, any non-printed words or graphics in the contract text will not be binding.
Force. In the process of signing the contract, it should be noted that when there are clean text clauses in the contract, all clauses and figures in the contract (except the signer's signature, time signature and seal) should be printed in advance, and there should be no handwritten words or spaces in the contract text during the signing process.
(eight) review "other terms"
Some necessary clauses that cannot be included in other parts.
(nine) review the "document number, effective"
1. The number of contract texts can be determined according to the convenience of contract performance. For example, if it needs to be executed by branches or branches, you can sign one more copy.
2. Pay attention to the difference between the establishment and effectiveness of the contract. For some special contracts, the contract will take effect only after administrative examination and approval, filing and other procedures.
Four. Annex to the contract
(1) Review the copy of the other party's business license, organization code and other documents (with official seal) ★
Need to pay attention to the annual inspection and the validity period of the certificate.
(II) Review the power of attorney of the signing representative of the other party and the identity information of the authorized person ★ Review the validity, authorization scope and duration of the authorized person's signature (review the official seal).
(3) Review "Other Annexes"
Pay attention to whether the annex is clear, whether it conflicts with the text of the contract, and whether there is an explanation order if there is any conflict. Other accessories include:
1. From the contract:
(1) Guarantee contract: mortgage/pledge/deposit/guarantee/lien;
(2) Supplementary Agreement: It should be noted that the supplementary agreement is an integral part of the main contract and has the same legal effect. In case of conflict, the supplementary agreement shall prevail.
2. Approval and statement documents of the parties to the contract: such as resolutions/statements of the shareholders' meeting/board of directors provided by the parties;
3. Registration, filing or approval documents of relevant government departments.
Verb (short for verb) The contract is over.
(a) audit "signature"
1. Before or during signing, confirm that the signer is the authorized person and check the identity documents.
2. Try to get the legal representative of the other party to sign and use the official seal;
Some illegal enterprises will use the special seal for contracts that have not been registered for industrial and commercial record to sign contracts. In case of dispute, they need to prove that the other party is qualified.
In addition, in the process of contract performance, non-official seals used by the other party, such as financial seal, business seal, special seal for contract, receipt seal, etc., need to be confirmed in advance by the official seal of the other company. For contracts with large subject matter, it is also necessary to go to the Industrial and Commercial Bureau to consult the other party's files and industrial and commercial files to confirm whether the official seal used is the official seal for filing.
Under normal circumstances, you need to use "official seal" or "special seal for contract" when signing a contract; Reconciliation should use official seal, special seal for contract or special seal for finance; To sign for the goods, you can use the official seal, special seal for contract, special seal for finance or special seal for business.
(II) Review "Signing Time" ★
The signing of the contract should have a specific time, which is related to the time when the contract takes effect.
And the determination of the contract performance period, therefore, it is suggested to print the signing time to avoid the situation that one party fails to fill in the signing time and the contract establishment time is divided.
(3) Review the "place of signature"
The place where the contract is signed is related to the jurisdiction agreement of the contract dispute.
Matters needing attention when signing a contract with intransitive verbs
(1) Pay attention to the page number of the contract and affix the seal of riding seam; ★
Prevent the contract from substituting the other party for the contract content.
(2) The company's business personnel need authorization to sign contracts with foreign countries.
It is suggested that the company list the scope of authorization as clearly and in detail as possible in the letter of introduction, power of attorney, contract and other related documents to avoid unnecessary disputes. After the business is completed, unused letters of introduction, power of attorney, contracts and other documents should be recovered as soon as possible.
After the company's business personnel leave their jobs, it is recommended that you send a written notice to the customers contacted by the business personnel at the same time as handling the handover procedures with them, informing them of the turnover of the business personnel.
(3) Signing a letter of intent or confidentiality agreement before signing the contract.
If you don't want the letter of intent to become a valid contract, you need to declare that the letter of intent has no legal effect (except confidentiality clauses, etc.). ), otherwise it may have legal effect.
(4) Confirmation of written materials in contract negotiation and performance stage.
At all stages of contract negotiation, it is best to leave written materials (such as meeting minutes, etc.). ). During the signing and performance of the contract, the telex and letters of both parties shall be kept in writing by special personnel, and the bills shall be handed over. Amendments to the contract shall be made in written form, and shall be approved by
Sign by both parties. In short, it is to have "written materials effectively confirmed by both parties" as far as possible.
The main points of the above contract review are mainly aimed at sales contracts, but in Chinese mainland practice, sales contracts rarely list all the above terms. Different kinds of contract terms vary greatly. Some contracts require all aspects to be involved, some contracts (such as orders) require conciseness, and some essential terms of contracts are clearly stipulated in law. Therefore, corresponding contract terms should be set according to the particularity of the contract to avoid the corresponding transaction risks.
In addition, for major contracts, preliminary legal review and legal review are required, and technical review and financial review may also be involved.
Legal meanings and differences of several concepts and nouns
(1) The meaning and difference of two "Ding" gold.
Before signing a formal contract, it is common to sign an "intention agreement" or a "pre-purchase contract" to pay the deposit, or directly stipulate the deposit in the contract. For example, we are going to buy a commercial house. After seeing the house satisfactorily, the sales girl will often ask you to pay a deposit and say that the house will be left to you. This is the usual situation. But the word "D" is very learned.
The deposit is an advance payment, which can directly offset the payment after the contract is signed, and will be returned when the contract cannot be signed. Deposit is one of the five ways of guarantee stipulated in the guarantee law. Five burdens
The guarantee methods include: guarantee, mortgage, pledge, lien and deposit. This is the deposit stipulated in the contract law, and the penalty for deposit is applicable.
Article 1 15 of the Contract Law stipulates that in accordance with the provisions of the Guarantee Law, the parties may pay a deposit to the other party as a guarantee for the creditor's rights. After the debtor performs the debt, the deposit shall be used as the price or recovered. If the party paying the deposit fails to perform the agreed debt, it has no right to demand the return of the deposit; If the party receiving the deposit fails to perform the agreed debt, it shall return the deposit twice.
Two "D" gold should be used according to different situations in practical application. In the contract or intentional agreement that mainly needs to bind the other party, it is best to use the deposit. The deposit can bind the other party, and the other party will not return the deposit if it fails to perform. If the main constraint is us, then we'd better use the deposit. If we want to change our mind, we just need to refund the deposit, not double it. For example, it has great reference significance for everyone's real life. A friend of mine, while watching a real estate, listened to the boast of the sales girl and wanted to buy the house of this real estate. The sales girl said, you have to buy it quickly. If you don't decide today, there will be no tomorrow? So my friend signed the Commodity House Pre-purchase Contract with them, paid a deposit of 20,000 yuan, and signed a formal contract with the developer within 0/5 days. Of course, developers are smart, using a deposit. Later, I went back to discuss with my family and felt that the house was not suitable for him. I wanted to refund the deposit and talk to the sales girl, but I was categorically denied. Later, I found an acquaintance to talk to the developer, but I still couldn't retreat. Later, he found me and asked me to help him find a way. The solution is to spend some money to ask the notary to talk about signing the contract together, which proves that the contract has been negotiated and the negotiation obligation has been fulfilled. Although the deposit was finally returned, it took a lot of trouble.
(2) The legal meaning and distinction of fines, fines and liquidated damages.
A large number of daily contracts can show what fines are agreed. In fact, fines are not one of them.
A term of contract law, but a way of administrative punishment. Only the organs that have the power of administrative punishment can exercise the power of administrative punishment, such as traffic violations and fines imposed by traffic police teams. Fines are a form of criminal punishment, and courts often use them in criminal judgments. For example, he was sentenced to three years in prison and fined 1 000 yuan.
Liquidated damages is a way for contract law to bear the liability for breach of contract. Article 1 14 of the Contract Law stipulates that when one party breaches the contract, it shall pay a certain amount of liquidated damages to the other party, and may also agree on the calculation method of damages for breach of contract. If the agreed liquidated damages are lower than the losses caused, the parties may request the court or arbitration institution to increase them; If the agreed liquidated damages are excessively higher than the losses caused, the parties may request the court or arbitration institution to reduce them appropriately.
There is no specific standard for liquidated damages, and now only the judicial interpretation in the sale of commercial housing clearly stipulates the upper limit of liquidated damages, which is not higher than 30% of the loss. Others are not clearly defined. It should be noted that liquidated damages and deposit cannot be applied at the same time. Article 1 16 of the Contract Law stipulates that if the parties agree on both liquidated damages and deposit, when one party breaches the contract, the other party may choose to apply the liquidated damages or deposit clauses.
(3) The difference between IOUs and IOUs
An IOU proves the loan relationship, and an IOU proves the debt relationship. Borrowing is definitely arrears, but arrears are not necessarily loans.
The reason for the formation of IOUs is the specific borrowing facts. There are many reasons for the formation of IOUs, which can be based on various facts, such as IOUs caused by buying and selling, IOUs caused by labor services, IOUs caused by enterprise contracting, IOUs caused by damages and so on.
When the holder of the IOU files a lawsuit with the court, it is easier to distinguish the IOU itself.
To ascertain the borrowing facts between the parties, the borrower generally only needs to simply state the borrowing facts to the judge, and it is generally difficult for the other party to defend or deny them. However, when the IOU holder brings a lawsuit to the court, he must state the fact of IOU formation to the judge. If the other party denies or excuses this fact, the IOU holder must further prove the existence of the IOU-forming fact.
The IOU represents a loan contract relationship, in which the borrower borrows money from the lender and the lender pays the loan. IOU is a settlement of the past economic exchanges between the two parties, indicating that a new pure creditor-debtor relationship has been formed between the two parties since the IOU was formed.
The IOUs and IOUs indicating the repayment period shall comply with the provisions of Article 137 of the General Principles of the Civil Law, and the limitation of action shall be counted as two years from the date when the repayment period is indicated. There are differences in the application of limitation of action between IOUs and IOUs that do not indicate repayment period or performance period. For an IOU with no repayment period, the lender may demand repayment from the borrower at any time, and the limitation of action starts from the time when the creditor claims the right. If the obligee claims the right again, the provision of interruption of limitation of action shall apply. However, if the lender fails to claim the right within 20 years after the borrower issues the iou, the limitation of action will no longer start.
The creditor knows that the debtor's issuance of the IOU with no time limit for performance infringes his rights, and shall claim his rights to the people's court within two years from the date of issuance of the IOU, that is to say, the statute of limitations for the IOU with no time limit for performance shall be counted from the date of issuance.
In this regard, the Supreme People's Court pointed out in the "Reply on when the limitation period of action should start when the debtor fails to perform the debt after the expiration of the agreed period" [Fa Fu (1994) No.35]: "The two parties originally agreed that the goods should be delivered by the supplier.
After that, it needs to be paid immediately, and the buyer has no money to pay after receiving the goods. With the consent of the supplier, he wrote an IOU with no repayment date. According to Article 140 of General Principles of Civil Law, the interruption of limitation of action should be recognized. If the supplier does not claim the right after the limitation of action is interrupted, the limitation of action should be recalculated from the day after the supplier receives the written debt from the buyer, which just confirms the above point of view. In addition, if the obligee claims his rights within the limitation period of two years, the provision of interruption of the limitation period shall also apply.