Accidentally go bankrupt?
2019-07-16

Recently, a micro-blog titled "Grandpa takes 13 yuan to buy a car in 4S shop" caused a great disturbance. It was on July 9th, a 4S shop in Qinhuangdao, Hebei Province, issued a sales advertisement called “the car was sell for 12.98 yuan". A grandpa took 13 yuan to buy a car in the 4S shop and the shop assistant said that the advertisement price was wrong and the actual price was 129,800 yuan. The netizen have commented on "big losses" and "feeling bankrupt". Three days later, it was verified that the farce was a marketing tool and the municipal bureau has intervened in the investigation. Now if you think we are going into the  Franco-Prussian time of the Unfair Competition Law, you're wrong. Today we are going to discuss the knowledge of the Contract Law. In fact, miss price often happens in life.

In 2017, Jiangsu Suning once made such a "price error". One day in September, Suning online shopping platform mislabeled a set of Ultra-Clear Television at 600 yuan which its original price was 6498 yuan. A man ordered 32 TV sets through the platform in four times. The question is: Does Suning really have to pay for the vast sums? Say with a network language, the people who lost a hundred thousand for nothing because of their careless are going to "go bankrupt"? Don't worry, let me tell you!

First of all, the Civil Law believes that we Chinese people all have the basic rational judgment ability and will do our reasonable duty of care in dealing, so in the case of miss price, it will tend to protect the persons of civil conducts whose interests are bigger loss and demands that we shall follow the "comprehension rules of the consideration" to explain this kind of advertisement’s essential meaning though the appearance.

Article 142 of the General Principles of Civil Law [Interpretation of Meaning Expressions] To explain the expressions that without counterparts, can not be strictly limited to the words and phrases used, but should be combined with the relevant provisions, the nature and purpose of the act, habits and the principle of good faith to determine the true meaning of the persons of civil conduct.

Article 7 of the General Principles of Civil Law, civil subjects shall follow the principle of good faith, uphold honesty and abide by their promises.

The advertisement behavior of Suning can be understood in law as: The person of civil conduct Suning made an expression about ‘600 yuan for a TV set meal’ to netizen, the non-specific objects. At this time, we should follow what the Civil Law really expected and believed, uphold integrity and rationality, combined with life experience to understand the advertisement and clear that ‘600 yuan for a TV set meal’ is not the real meaning of Suning.

Now it is clear that this is an untrue expression, our next step is to fix this misunderstanding. Let's see what magic props the law provides us~

Article 147 of the General Principles of Civil Law states that the persons of civil conduct have the rights to request courts and arbitral institutions to revoke the civil juristic acts which committed on the basis of serious misunderstanding.

Article 54 of the Contract Law stipulates that in the following two situations, the parties have the rights to request courts and arbitral institutions to change or revoke the contracts: (1)the contract is concluded due to a serious misunderstanding; (2)unfairness in the conclusion of the contract.

<The supreme court’s opinions on several issues about carrying out the ‘general principles of the civil law’> If the persons of civil conduct misunderstands the nature of the act, the other party, the variety, quality, specifications and quantity of the subject matter, so as to make the consequences of the act contrary to his own meaning and cause considerable losses, he may be regarded as a serious misunderstanding.

Yes, it is the revocation right!

Before explaining the revocation right, let's first understand the high-frequency words here——serious misunderstanding. Not all misunderstandings are called major misunderstanding. Its establishment needs to meet four requirements:

The persons of civil conduct made a wrong expression because of misunderstanding;

There must be a major misunderstanding of the contents of the contract. This situation may happen in life: a couple decided to buy a TV, but they went to different supermarkets to buy two TV sets for 5000 yuan each. Although this misunderstanding was really big, they can't cancel the contract on the grounds of serious misunderstanding, for the reason that they have misunderstood the motive of buying TV but not the content of the contract itself.

The misunderstanding is caused by the misunderstanding party's own fault, which means that if the misunderstanding is caused by advertiser's deception, or if the consumer actually knows that the advertiser selling fake goods but still conclude a sales contract, the contract cannot be canceled on the grounds of a serious misunderstanding.

The misunderstanding should be large enough to directly affect the rights and obligations of the parties. If only a little pieces are marked down, it can not constitute a serious misunderstanding, there is no need to waste judicial resources so that businessmen have to assume the careless responsibility on their own.

As long as the above four requirements are met, congratulations to this businessman, the shareholders can no longer worry about becoming bankrupt, take your trump card - revocation right and solve it! Let's go back to this case. Suning miswrote the price, which caused the customers to have a serious misunderstanding about the main term of the contract - the price of the target TV set.  According to the law, both parties of the contract that Suning and the buyer should have the legal right to revocation.

There are two points they need to pay attention to: first, they need to exercise the right of revocation in three months after they know or should know the cause of revocation, in other words, the time when Suning stafs discover the problem or the customers find the misunderstanding, they can exercise the revocation right in three months; Second, they can only exercise the revocation right in the way of prosecuting and arbitration, like the way of text messaging,  phone calling and so on are not feasible.

Based on the above discussion, I believe that you guys have guessed the right outcome: Jiangsu Suning didn’t pay the money foolishly but filed a lawsuit on December 8, 2017 to the Xuanwu District Court and requested to revoke the contract, and the court naturally supported his claim in accordance with the law.

At this point, some friends may have a question: the law well protects the interests of the persons of civil conduct, but what about the counterparts? Even if the counterparts have the mentality of opportunism, they also paid the expectation and energy and even some necessary costs, is too unsatisfied   persons of civil conduct to terminate the contract. Calm down! Although the law does not protect the counterparts’ contractual interests, it will not let them suffer losses. It sets a layer of protection  named "contracting negligence liability" for the counterpart.

Article 42 of the Contract Law, the party shall be liable for damage if it is under one of the following circumstances in concluding a contract and thus causing losses to the other party: (1) pretending to conclude a contract, and negotiating in bad faith; (2) deliberately concealing important facts relating to the conclusion of the contract or providing false information; (3) performing other acts which violate the principle of good faith.

Contracting fault liability refers to that one party violates the principle of good faith and causes the loss of the trust interests of the other party in the process of contract conclusion, which should bear the liability for damages. If businessmen miswrote the advertisement prices, failed to acknowledge the validity of the contract or canceled the contract on the grounds of a serious misunderstanding, which it is an act contrary to the principle of good faith that causes serious misunderstanding of the nature or terms of the contract by the counterpart, and it is necessary to bear the liability for damages resulting in loss of trust interests of others. Such as the contracting costs, the preparing costs, the interests lost by the actual performance costs, the loss of profits and so on. That is to say, if the grandpa, as we mentioned at the beginning, was not a person of civil conduct but a customer who really wanted to buy a car, he had the right to ask the 4S shop to compensate his the necessary costs of going to buy a car.

A jurist once said, "the rational man always thinks for others, prudence is his guide, 'safety first' is his rule." The law does not require citizens to be "saints", but will not protect "fools". If you want to get the protection of the law, first learn to protect yourself and act as a rational and prudent person of civil conduct that the law requires you to be!

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