Point of View... Analysis of the tenderer's liability for breach of contract without justifiable reason.
Published:
2024-07-26
While bidding is widely used in modern economic life, there are also some legal problems. In judicial practice, we will encounter the situation that the tenderer delays or even refuses to sign a written contract with the winning bidder after issuing the "Letter of Acceptance" to the winning bidder for various reasons. In this case, is the contract between the two parties established? Does the tenderer constitute a breach of contract? If it constitutes a breach of contract, what kind of liability should the tenderer bear? This paper analyzes the above-mentioned problems in the light of legal provisions and relevant judicial precedents.
Introduction
In the modern social life, the bidding activity is an organized way to make a deal based on merit by using the methods of technology, economy and the competition mechanism of market economy. The tenderer attracts potential bidders to compete on an equal footing according to the same conditions through the procurement needs and relevant requirements announced in advance, conducts evaluation according to the prescribed procedures, and finally selects the winning bidder from the bidders, the essence is to obtain the best goods, works and services at a lower price.
While bidding is widely used in modern economic life, there are also some legal problems. In judicial practice, we will encounter the situation that the tenderer delays or even refuses to sign a written contract with the winning bidder after issuing the "Letter of Acceptance" to the winning bidder for various reasons. In this case, is the contract between the two parties established? Does the tenderer constitute a breach of contract? If it constitutes a breach of contract, what kind of liability should the tenderer bear? This paper analyzes the above-mentioned problems in the light of legal provisions and relevant judicial precedents.
1. whether the contract between the tenderee and the winning bidder is established after the Letter of Acceptance is issued.
There is a view that the tender documents belong to the invitation to offer, the tender documents belong to the offer, the tenderer's "notice of winning bid" issued to the winning bidder belongs to the commitment, the "notice of winning bid" reaches the winning bidder, the two sides will establish the tender documents as the content of the contract.
There is also a view that the issuance of the Notice of Award only enables the tenderer and the bidder to establish an appointment contract between the tenderer and the bidder to sign the same contract. Article 45 of the the People's Republic of China Bidding Law stipulates: "After the winning bidder is determined, the tenderer shall issue a notice of winning the bid to the winning bidder and at the same time notify all unsuccessful bidders of the winning result. The notice of winning the bid shall have legal effect on the tenderer and the winning bidder. If the tenderer changes the result of winning the bid after the notice of winning the bid is issued, or if the winning bidder abandons the winning project, he shall bear legal liability in accordance with the law." The first paragraph of Article 46 stipulates: "Article 46 The tenderer and the winning bidder shall, within 30 days from the date of issuance of the bid-winning notice, conclude a written contract in accordance with the tender documents and the bid documents of the winning bidder. The tenderer and the winning bidder shall not conclude any other agreement that deviates from the substantive content of the contract." Article 490, paragraph 1, of the the People's Republic of China Civil Code states: "Where the parties conclude a contract in the form of a contract, the contract is formed when both parties sign, seal or press the finger. Before signing, sealing or pressing the finger, one of the parties has performed its main obligations and the other party accepts the contract." Article 495 stipulates: "A subscription, order, reservation, etc., in which the parties agree to conclude a contract within a certain period of time in the future, constitutes an appointment contract. If one of the parties fails to perform the obligation to conclude the contract under the appointment contract, the other party may request it to bear the liability for breach of the appointment contract." According to the above laws and regulations, the bid winning notice does not have the effect of establishing this contract, but only confirms the bid winning notice. The issuance of the bid winning notice makes both the tenderer and the bid winning bidder have the obligation to conclude a procurement contract with the other party within a certain period of time. From this perspective, after the bid winning notice is issued, both parties have the obligation to conclude this contract, A formal written contract should be signed according to the contents of the tender and tender documents, and the author also agrees with the second view.
Chongqing No. 5 Middle School also believes that when contracting through bidding, the notice of winning the bid is the intention of the tenderer to make a commitment to the winning bidder, which indicates the establishment of an appointment contract relationship between the parties.
In December 2015, an agricultural product company and an investment consulting company signed the ''Bidding Agency Entrustment Contract'', agreeing that an agricultural product company entrusts an investment consulting company to be the bidding agency for construction projects, and undertake the equipment procurement and installation of a project in Chongqing. Bidding agency work. A manufacturing company paid a bid bond of 30000 yuan and sent a "bid letter" to an agricultural product company and an investment consulting company. In September 2016, an agricultural product company and an investment consulting company sent a "Letter of Acceptance" to a manufacturing company, an agricultural product company stamped the company seal at the tenderer, and an investment consulting company stamped the seal at the bidding agency. In November 2016, a Chongqing Construction Committee sent a notice to an agricultural product company to reorganize bidding, which stated: "the original bid winning result is invalid, and the tenderer shall revise the bidding documents and re-bid according to law". An agricultural product company sent a letter to a manufacturing company based on the above notice, informing it that the winning result was invalid, and revising the bidding documents and re-bidding in accordance with the law. In June 2017, a Chongqing Construction Committee served a notice of revocation to an agricultural product company, revoking the "Notice of Ordering to Reorganize Bidding" made by a Chongqing Construction Committee in November 2016. An agricultural product company did not sign a written contract with a manufacturing company.
Regarding the establishment of a contract between an agricultural product company and a manufacturing company, Chongqing No. 5 Intermediate People's Court held that Article 2 of the Interpretation of the Supreme People's Court on the Application of Legal Issues in the Trial of Sales Contract Disputes (2012) stipulates: "The parties sign a subscription, Order, reservation, letter of intent, memorandum and other appointment contracts, agreed to conclude a sales contract within a certain period of time in the future, and one party fails to perform its obligation to conclude the contract, if the other party requests it to bear the liability for breach of the appointment contract or requests the termination of the appointment contract and claims damages, the people's court shall support it." According to the above-mentioned law, when contracting by means of bidding, the notice of winning the bid is the intention of the tenderer to make a commitment to the winning bidder, which indicates the establishment of an appointment contract relationship between the parties. The parties should also enter into a formal sale or installation contract to clarify the specific rights and obligations of the parties. The appointment contract is also legally binding on both parties. According to the contract law, the signing of a formal contract is the legal obligation of both parties at the time of the establishment of the appointment contract, and an agricultural company should enter into a formal written contract with a manufacturing company.
2. the tenderer fails to conclude a contract with the winning bidder without justifiable reasons, he shall bear the scope of liability for breach of contract.
The author believes that according to Article 495 of the the People's Republic of China Civil Code, it should be considered that the issuance of the Letter of Acceptance makes the tenderer and the winning bidder establish an appointment contract with the obligation to sign a written contract. If the tenderer fails to sign a written contract with the winning bidder without justifiable reasons, he shall be liable for breach of the appointment contract. Because the obligation of the appointment contract is the act of signing the contract, it is not the transaction itself, the tenderer's breach of the appointment contract will cause the winning bidder to lose the opportunity of the transaction, should not involve compensation for the performance of the interests, therefore, the breach of the contract of the breach of the appointment is only compensation for the interests of trust, and does not include the loss of the available benefits.
Typical cases published in the Shandong High Law also support this view:
The "Competitive Consultation Announcement" issued by a consulting company entrusted by Company A states that the purchaser is Company A and the bidding agency is a consulting company. The procurement project is a provisional valuation material procurement project for a heating project. The negotiation deposit is 30000 yuan. The purchaser shall refund the negotiation deposit of the supplier who has not yet completed the transaction within five working days after the transaction notice is issued, the negotiation deposit of the closing supplier shall be refunded within five working days after the signing of the procurement contract; the purchaser and the closing supplier shall sign a written procurement contract within 30 days from the date of issuance of the closing notice. If the purchaser refuses to sign the contract without justifiable reasons, double the negotiation deposit shall be returned.
Company B, as a supplier, paid a deposit of 30000 yuan to participate in the negotiation and bidding of the project and won the bid. The Transaction Notice states that the transaction supplier is Company B, and the supplier shall sign a written purchase contract within 30 days from the date of receipt of the notice. However, Company A, the tenderee, subsequently refused to sign a written purchase contract with Company B, the winning bidder, without justifiable reasons. After that, Company B sued the people's court and demanded Company A to double the return of the negotiation deposit of 60000 yuan and other losses and profit losses.
With regard to the treatment of liability for breach of contract, the court in the case held that the appointment is different from this contract, and the scope of liability for breach of contract caused by the breach of the contractual obligations of the two is also fundamentally different, and generally speaking, the liability for breach of the appointment contract is limited to the loss of trust interests and does not include the loss of available benefits. If the tender documents clearly stipulate that the deposit is of a deposit nature and the essence is a contract deposit, the second paragraph of Article 588 of the the People's Republic of China Civil Code can be applied to the actual loss. This article stipulates the relationship between the deposit and the compensation for losses, that is, the one-way compensation principle of the deposit is determined. If the deposit penalty is applied to make up for the loss of the contract-keeping party, the people's court should no longer support the request for compensation. The trial court found that the actual loss of Company B was less than 30000 yuan, and the applicable deposit penalty was sufficient to make up for its loss. Therefore, it should only support the request for double return of the deposit, and not support the losses such as the available benefits.
The scope of liability for breach of contract of the appointment contract is roughly equivalent to the scope of liability for the contracting negligence of this contract, that is, it is equivalent to the trust interest of the contract. The compensation for the trust interest that the winning bidder may claim generally includes the tender fee paid by the tender, the tender agent service fee, the transportation and travel expenses, the return of the tender deposit, as well as the losses suffered as a result of the issuance of the tender deposit, and the necessary costs of manpower, material resources and management costs invested by the bidder in the preparation of the tender documents.
On the whole, after the Notice of Award is issued, the two parties establish an appointment contract relationship, the tenderer does not sign a contract with the winning bidder without justifiable reasons, the winning bidder may require it to bear the liability for breach of contract, such liability for breach of contract is limited to the loss of trust interests and does not include the loss of available interests. However, as mentioned above, if the tender documents and other documents clearly stipulate that the deposit is of a deposit nature, the winning bidder may deal with it in accordance with the second paragraph of Article 587 and Article 588 of the the People's Republic of China Civil Code.
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