Contract Law of the People's Republic of China
Author:sipoIssuing Date:2008-01-24 13:28:30Source:sipo
Article 67 Where both parties have obligations towards each other and there has been an order of priority in respect of the performance, and the party which shall render its performance first has not rendered the performance, the party which may render its performance lately has the right to reject the other party's request for performance. Where the party which shall render its performance first violates the terms of a contract while fulfilling the obligations, the party which may render its performance lately has the right to reject the other party's corresponding request for performance.
Article 68 One party, which shall render its performance first, may suspend its performance, if it has conclusive evidence that the other party is under any of the following circumstances:
(1) Its business conditions are seriously deteriorating;
(2) It moves away its property and takes out its capital secretly to evade debt;
(3) It loses its commercial credibility;
(4) Other circumstances showing that it loses or is possible to lose the capacity of credit.
Where a party suspends performance of a contract without conclusive evidence, it shall be liable for the breach of contract.
Article 69 One party to a contract which suspends its performance of the contract in accordance with the provisions of Article 68 of this Law, shall promptly inform the other party of such suspension. It shall resume its performance of the contract when the other party provides a sure guarantee. After the suspension of the performance, if the other party does not reinstate its capacity of performance and does not provide with a sure guarantee, the party suspending performance of the contract may rescind the contract.
Article 70 If the obligee does not notify the obligor its separation, merger or a change of its domicile so as to make it difficult for the obligor to perform the obligations, the obligor may suspend the performance of the contract or have the object deposited.
Article 72 The obligee may reject the partial performance of the contract by the obligor, except that the partial performance does not damage the interests of the obligee.
Additional expenses caused to the obligee by partial performance shall be borne by the obligor.
Article 73 If the obligor is indolent in exercising its due creditor's right, thus damaging the interests of the obligee, the obligee may request the people's court for subrogation in its own name, except that the creditor's right exclusively belongs to the obligor.
The subrogation shall be exercised within the scope of the creditor's right of the obligee. The necessary expenses caused to the obligee by exercising subrogation shall be borne by the obligor.
Article 74 If the obligor renounces its due creditor's right or transfers its property gratis, thus damaging the interests of the obligee, the obligee may request the people's courts to revoke the obligor's act. If the obligor transfers its property at an obviously unreasonable low price, thus damaging the interests of the obligee, and the transferee knows such situation, the obligee may request the people's court to revoke the obligor's act.
The right of revocation shall be exercised within the scope of the creditor's right of the obligee. The necessary expenses caused to the obligee by exercising the right of revocation shall be borne by the obligor.
Article 75 The time limit for exercising the right of revocation shall be one year, commencing from the day when the obligee is aware or ought to be aware of the causes of revocation. If the right of revocation has not been exercised within five years from the day when the act of the obligor takes place, the right of revocation shall be extinguished.
Article 76 After a contract becomes effective, the parties may not reject to perform the obligations of the contract because of modification of the title or name of the parties, or change of the statutory representative, the responsible person or the executive person of the parties.
Chapter 5 Modification and Assignment of Contracts
Article 77 A contract may be modified if the parties reach a consensus through consultation.
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