What Is a Fairness Opinion?

The so-called unfairness means that one party takes advantage of his own advantages or the inexperience of the other party, causing the rights and obligations of both parties to clearly violate the principle of fairness and equal compensation. Whether a civil act is obviously unfair should be based on the situation at the time when the act was established. ^[1]

Obviously unfair

Obviously unfair contracts have the following legal characteristics:

1. Such a contract is obviously unfair to both parties. Contracts, especially dual service contracts, should embody the principles of equality, equivalence and fairness, and only in this way can contract justice be achieved. However, a contract that is unfair requires one party to bear more

1. A comprehensive measure of whether the benefits gained by one party or the losses suffered by the other party violate laws or trading habits;

2. Investigate whether one party used its advantages or the other party's rashness and inexperience during the conclusion of the contract, depending on whether the party with impaired interests has no experience or lacks the ability to understand the relevant content of the contract, or because of an urgent situation, Truly voluntarily accepted the contract conditions proposed by the other party, such as the contract set certain terms that are obviously against one party.

Generally, the foundation of maintenance contract law is "

The purpose of setting up a system of apparent unfairness is to ensure that both parties to the contract complete transaction behaviors on a completely voluntary and equal basis, and urge people to follow

"

1. What is fair.

For the two parties to the contract, is the fairness of the contract reflected in the subjective cognition of the parties to the contract, or should there be a universal objective standard? There is a famous motto, "A penny or a pepper seed can constitute a valuable consideration." This sentence may remind us from one side that the pursuit and value of contract parties are subjective, unstable and relative. It varies with people's needs, tastes, and emotions. Although people's subjective value standards are mostly the same, consistent, and not much different, we can still conclude that contracts are transactions The legal means should reflect the fair nature of the transaction. Generally speaking, the parties are equal in a truly voluntary transaction, and only an equal transaction can be fair. In other words, the contract between the two parties of the contract is based on genuine intentions, despite the usual and universal value. Evaluation of standards and fairness standards shows that the interests of both parties have become unbalanced, but as far as the parties to the contract are concerned, as long as he thinks it is fair, the law should respect the parties' autonomy and should not interfere. In contractual relations, fairness can be understood as the parties' voluntary choice of interests. Even if the price paid by one party to the other is low, it is fair and consideration if the parties accept it voluntarily. The "fairness" mentioned in the principle of apparent unfairness should refer to the imbalance of interests caused by the parties who did not sign the contract completely out of genuine intention. The reason why they signed the contract was because they lacked trading experience, lacked judgment, were too hasty, There are obvious advantages in some aspects

Under the circumstances, if it is not restricted by these factors, he will not reach a contract with such content.

2. The "explicit" standard in "explicit unfairness".

The extent to which the contract is unfair is obviously unfair. This article considers that the following three aspects should be examined:

A contract that is obviously unfair should be a double-service contract, and a single-service contract that does not pay consideration does not matter.

One party has obtained benefits that exceed the limit permitted by law, while the other party may suffer significant losses as a result, and the rights and obligations of the two parties to the contract are obviously not equal. Such as the price of the price greatly exceeds the price of similar goods or services in the market.

Due to factors such as supply and demand, the price should deviate from the value properly, or the benefits and losses caused by the inherent risks of the market should be excluded.

3. The principle of apparent unfairness should pursue procedural fairness, not result fairness.

If we only understand it from the word "unfairness", this is obviously a proposition focusing on the outcome of the contract. However, it is procedural fairness, not a simple one, that is maintained as a major principle of contract law and even civil law. The results are fair, at least for the following reasons:

Simply changing or revoking a contract based on the unfairness of the results can easily lead to unfair and confusing results caused by various reasons, which violates the law of value. There are many reasons for the unfairness of the final result. Under market economic conditions, the deviation of price from value will become the norm. The pursuit of pure result fairness is likely to interfere and distort the relationship between the two parties based on the role of market supply and demand. Causes the rejection of the law of value.

The pursuit of fairness of results focuses on guaranteeing fairness of results, but neglects to maintain fairness in the transaction process and order, artificially excludes risks, is not conducive to the cultivation of the market economy mechanism, and violates the inherent attributes of market economy risks. It must be known that contract law is "law" rather than contract, and contract law cannot "constrain the contract". The contract law should focus on providing parties with fair trading rules and order, rather than enclosing everything, and directly entering into "fair and reasonable" contracts for the parties.

Only pursuing fair contract results does not meet the requirements of market competition. The market economy is a competitive economy. As long as the conditions of competition are fair, the market subjects are equal in the competition, enjoy equality and opportunity, and comply with the "rules of the game" of the competition, then it is fair competition. The best interest is legitimate. The pursuit of fair contract results will artificially exclude and restrict market competition, thereby affecting the rationality and efficiency of resource allocation.

4. The principle of unfairness of contract and party autonomy.

The injured party in a clearly unfair contract is a civil act carried out in the absence of experience, judgment, or urgency, hasty, or some advantage of the other party. A clearly unfair contract does not fully express its will to the party whose interest has been lost. So, in this sense, a contract that is obviously unfair can also be said to be a party

(1) Relevant provisions of the existing law

In China's current law, there are provisions of the General Principles of Civil Law, the Opinions of the Supreme People's Court, and the Contract Law. Although they are not very clear or complete, they can still be drawn in general. A contour.

The General Principles of the Civil Law stipulate that a party has the right to request a people's court or arbitration institution to change or revoke a civil act that is materially misunderstood or obviously unfair. The "Mintong Opinion" provides a judicial interpretation of the determination of apparent unfairness, that is, "one party's use of advantages or the inexperience of the other party to cause the rights and obligations of both parties to clearly violate the principle of equivalent compensation can be determined as unfair.

For a contract that is obviously unfair, one party has the right to request the people's court or arbitration institution to change or cancel it. As for the request for change or cancellation of the contract, the parties have the right to choose. The contract law stipulates that the following contracts can be changed or cancelled: first, those concluded due to major misunderstandings; second, those that are obviously unfair when the contract is concluded. This is about "obviously unfair", not a bit unfair, but "unfair when signing a contract." There are always risks involved in business activities, and some are always profitable and some are compensation. This is normal. The risks arising from performance do not fall into this scope, and it is necessary to distinguish between apparent unfairness and normal risks. Third, a party uses fraud, coercion, or danger to make the other party enter into a contract that violates its true meaning. The stipulation that the contract can be abolished is to reflect and maintain the principles of fairness and voluntariness, and to give the parties a means of remedy. The Contract Law clearly stipulates that a party that has suffered a fair loss due to a contract's apparent unfairness has the right to propose a change or revocation, and the party at fault shall compensate the other party for the losses suffered within the scope of reasonable compensation.

The principle of apparent unfairness is like a double-edged sword. It can not only maintain the justice of the contract, but also cause public power to erode and endanger contract freedom. Therefore, some scholars have advocated the abolition of the principle of unfairness. In fact, from a practical point of view, problems in the application of the system of apparent unfairness, such as the standard being too abstract, difficult to be grasped and operated, and the scope of application of explicit unfairness, are too broad. Contracts that are obviously unfair should not be revoked.

(I) Questions about the applicable object of the principle of apparent unfairness

Investigating the background of foreign legislation, the principle of apparent unfairness was proposed mainly for the contracting parties whose economic status in the transaction is too different. In judicial practice in the United States, consumers who can really invoke the principle of unfairness to achieve the purpose of rescission of contracts are low-income consumers, and are small businessmen who are in the same weak position as consumers and who trade with large companies. For our country, the scope of application of the principle of apparent unfairness should also be appropriately limited, mainly in the field of consumer protection, and it has become a legal weapon for consumers to combat traitors. For professional businessmen, because of their ability to protect themselves from obvious unfairness, the court should generally not intervene on the grounds of apparent unfairness in the contractual relationship between businessmen.

(B) the quantitative standards of apparent unfairness

The principle of explicit loss of fairness is the specific application of the principle of good faith in contractual relations. As a flexible clause of social public rights interference in contract freedom, its connotation can only be relatively clear and not absolutely clear, which provides a comparative method for judges to hear cases. Great freedom of choice. How to prevent judges from abusing this right and making it affirmative or negative based on individual preferences is not only related to the rights and obligations of the parties, but also to the rise and fall of the entire contract system. This article believes that the following aspects should be taken into consideration:

1. Establish quantitative standards where possible.

Although in many cases, the judgment of fairness depends on the subjective standards of judges, and the connotation of obvious unfairness cannot be absolutely clear, but in some cases, we do need to be able to formulate relatively clear objective standards. For example, China s relevant judicial interpretations have stated that the maximum interest rate for private loans may not exceed four times the interest rate of similar banks, and interest beyond this limit is not a good example.

Of course, the issue of balance of interest or imbalance should be identified according to the specific conditions of various trading relationships, especially considering various factors such as supply and demand relationships, price fluctuations, and trading habits.

2. The courts at all levels should pay attention to accumulating trial experience, and the Supreme Court should timely find and publicize the judgment standards of typical cases for the reference and reference of courts at all levels.

(3) The issue of the burden of proof of the injured party on the subjective elements of unfairness.

One party to the contract has the intention to use the advantages of the other party or use the other party's indiscretion, inexperience, etc. to enter into a clearly unfair contract with the other party. If the injured party wants to claim that the contract is unfair and applies for change or revocation, he must bear the corresponding burden of proof. If the injured party cannot prove that the other party has such intention, it can only prove that it lacked experience and skills, did not understand market conditions, hastily, etc. when entering into a contract, and thus concluded a contract that was already unfavorable. Two points need to be explained here:

1. In the case of the subjective requirements for the use of advantages, if the losing party can only prove that the other party has taken advantage of the supply and demand relationship, and put forward unreasonable price conditions, it does not constitute obvious unfairness. Because under the condition of competition, the supply and demand relationship itself is constantly changing. This change is a transaction risk, and it is difficult to say which party has taken advantage.

2. The use of the other party's inexperience or recklessness should be strictly limited. Because in this case it is obviously unfair, the factor or fault of the injured party is also a cause. At this point, the injured party should prove that the other party has exploited it, and not just prove that they have no experience or recklessness when contracting. In order to prove the other party's use of behavior, the victim can prove that the other party knows that he has no experience or recklessness, and creates chaotic price information and subject matter information or improperly exaggerates the sales of the subject matter, which affects him to make a correct judgment.