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Dissolution and Termination of Contracts

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Chapter Summary

Scholars in China debate on the difference between dissolution of the contract and termination of the contract. The Contract Law seemingly takes the stance to treat the dissolution as one of the circumstances under which a contract may be terminated. A contract may be dissolved under certain circumstances, and the occurrence of a circumstance that leads to dissolution of a contract would serve as an excuse for the party involved not to perform its contractual obligations. Generally, the termination discharges both the rights and obligations of the contractual parties, whereby the performance of contract is called to a complete stop. The Contract Law provides a laundry list of the causes to terminate a contract. In light of termination of a contract, assumption would become a cause if there is a consolidation of parties or a combination of contractual rights and obligations upon one party.

Keywords: China; contract dissolution; contract law; contract termination; contractual obligations; contractual rights

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