What is the Liability for Invalidating the Contract?
2020/1/8
Company A wants to purchase a batch of raw materials to make finished products for sale. The general manager of Company B and the chairman of Company A have always been in bad blood. Company B wanted to destroy the business of Company A. Therefore, Company B deliberately negotiated with the purchasing department of Company A and finally signed a contract in May 2008, agreeing to deliver raw materials before the end of January 2009. The contract price is 100 yuan per kilogram, which is in line with the market price. After signing the contract with Company B, Company A signed a contract with Company C to sell the finished products, agreeing to deliver the finished products before March 1, 2009. Until January 31, 2009, Company B did not deliver the raw materials, and Company A repeatedly urged without success. On February 20, 2009, Company A purchased raw materials from Company D at the market price of 120 yuan per kilogram, and wanted to deliver the finished products in time. However, Company A worked around the clock and failed to meet the delivery date of March 1, so it finally broke the contract with Company C and lost one million yuan. Can Company A claim against Company B? What is the scope of the claim?
Company B needs to assume responsibility for contracting fault. In accordance with the Article 42 of the Contract Law of the PRC, it is necessary to bear the liability for damages if a contract is entered into in the guise of maliciously. Therefore, Company A can definitely claim compensation from Company B. What is the scope of the claim? Firstly, in the contract between Company A and Company B, Company B shall bear the liability for breach of contract. Secondly, when Company A later purchased raw materials from Company D, the price of raw materials increased by 20 yuan per kilogram, and the loss of this part can also be claimed by Company B. Thirdly, Company A has lost one million yuan in the contract with Company C, and can also claim compensation from Company B. Moreover, Company A may claim compensation from Company B for any other losses caused by the breach of contract by Company B, such as travel expenses incurred during negotiations and insurance premiums purchased in advance for raw materials.
Thus, the scope of compensation for contracting negligence is large, including the actual loss and trust interests. In case of confusion the clients should seek the lawyer's help in time.