From March to April 2026, the “International Commercial Arbitration Theory and Practice” series of courses, jointly launched by the Tianjin Lawyers Association, Tianjin Arbitration Commission, Tianjin Import and Export Chamber of Commerce, and Tianjin Returned Overseas Chinese Federation, continued to advance. Following the successful conclusion of the first session “Contract Formation” on March 14, the second session “Contract Content” (March 28), the third session “Contract Interpretation” (April 11), and the fourth session “Contract Performance, Waiver and Estoppel” (April 18) were held one after another. Practicing lawyers from various law firms in the city actively participated, and the course venue was full. The course system was personally designed by Mr. Yang Liangyi, a member of the Expert Committee of the International Commercial Court of the Supreme People’s Court and Honorary Chairman of the Hong Kong International Arbitration Centre. Three experts with profound attainments in their respective fields gave lectures, presenting a systematic knowledge feast of English contract law to Tianjin’s foreign-related lawyers.
I. Course System: Complete Advancement from Contract Content to Performance
The “International Commercial Arbitration Theory and Practice” series of courses is personally led and designed by Mr. Yang Liangyi, aiming to systematically improve the understanding and application ability of Tianjin’s foreign-related lawyers on international commercial game rules. The series of courses takes English contract law as the main line, and progresses layer by layer according to the logical chain of “contract formation – contract content – contract interpretation – contract performance”, building a complete knowledge framework for students. The previous first course was co-taught by Mr. Yang Liangyi and Ms. Si Jia, focusing on the core legal points of foreign-related transactions such as the elements of contract formation, contract form specifications, and the principle of contract relativity, laying a solid foundation for enterprises to clarify the key links of foreign-related contract conclusion. The three lectures in this issue focus on the classification of contract content, interpretation principles, and the game of rights and responsibilities in performance, closely combining theoretical depth with practical application.
II. The Second Session: Contract Content – The Boundary between Express and Implied Terms
On March 28, the second course “Contract Content” was lectured by Chen Xiaoshan, a partner of Shanghai Kaimen Law Firm. Chen Xiaoshan joined the Hong Kong office of DLA Piper in 2008 and has long handled cross-border dispute cases involving Chinese parties. He was rated as a leading partner in dispute resolution by Legal 500 and a potential lawyer in dispute resolution – arbitration by Chambers.
Condition Clauses, Warranty Clauses and Innominate Terms – Three Standards of Breach of Contract Remedies
Chen Xiaoshan first systematically sorted out the classification system of contract clauses under English law with classic cases as clues. According to whether the non-breaching party has the right to terminate the contract when one party breaches the contract clause, English law divides contract clauses into three categories: condition clauses, warranty clauses and innominate terms. Breaching a condition clause touches the root of the contract and destroys the commercial purpose, and the non-breaching party has the right to terminate the contract; breaching a warranty clause is a secondary clause, and the non-breaching party can only claim damages and has no right to terminate the contract. This classification has continued to develop in the judicial practice of the Hong Kong Court of Final Appeal, for example, in the case of MG Charter Ltd v Beijing Caissa International Travel Service Co., Ltd, the Hong Kong Court of Appeal conducted an in-depth analysis of the determination of the nature of contract clauses.
The emergence of innominate terms is an important development in English contract law. Chen Xiaoshan focused on analyzing the landmark case of Hong Kong Fir Shipping Co Ltd v Kawasaki Kisen Kaisha Ltd [1962] 2 Q.B. 26. Lord Diplock pointed out in this case that many contractual promises cannot be classified as “conditions” or “warranties” – some breaches will cause the non-breaching party to substantially lose all the benefits it should have obtained, while other breaches will not. For such clauses, the court needs to judge whether the breach has caused a fundamental loss of contract purpose, and then decide whether the non-breaching party has the right to terminate the contract. This flexible judgment standard has been widely applied in international commercial arbitration.
Implied Terms: The “Invisible Framework” of the Contract
In addition to express terms, implied terms are another important part of contract content. Chen Xiaoshan introduced the sources of implied terms in English law, including statutory implied terms, terms implied by custom, and terms implied by the court to give business efficacy to the contract. Taking the Sale of Goods Act as an example, he explained that the law implies terms such as satisfactory quality and fitness for purpose in sales contracts, which do not need to be clearly stated in the contract but are binding on both parties. In the case of Liverpool City Council v Irwin [1977] A.C. 239, the House of Lords held that the landlord had an implied obligation to maintain the common parts of the building, which was a typical case of the court implying terms to maintain the fairness of the contract.
III. The Third Session: Contract Interpretation – Exploring the True Intention of the Parties
On April 11, the third course “Contract Interpretation” was given by Ms. Si Jia, a partner of Beijing Dacheng Law Firm (Tianjin) and a member of the Hong Kong International Arbitration Centre. Ms. Si Jia has long been engaged in foreign-related legal services and has rich experience in international commercial arbitration.
The “Contextual Interpretation” Principle: Beyond the Text of the Contract
Ms. Si Jia emphasized that the core of English contract interpretation is to explore the true intention of the parties at the time of contract formation, rather than simply interpreting the literal meaning of the words. She introduced the “contextual interpretation” principle established by the UK Supreme Court in the case of Rainy Sky SA v Kookmin Bank [2011] UKSC 50, that is, when interpreting the contract, the court should consider all relevant background information at the time of contract conclusion, including the negotiation process, industry practices, and the commercial purpose of the contract. In this case, the court held that the meaning of the “guarantee clause” in the letter of credit should be combined with the overall transaction background, rather than being limited to the literal meaning of the words.
Contra Proferentem Rule: Constraining the Drafting Party
When the contract terms are ambiguous, English law applies the contra proferentem rule, that is, the ambiguous terms should be interpreted against the party who drafted the contract. Ms. Si Jia took a Sino-foreign joint venture contract dispute as an example. The contract drafted by the foreign party had ambiguous provisions on profit distribution. The arbitral tribunal finally interpreted the clause in favor of the Chinese party according to the contra proferentem rule, which effectively protected the legitimate rights and interests of the weaker party in the contract negotiation.
IV. The Fourth Session: Contract Performance, Waiver and Estoppel – The Game of Rights and Responsibilities
On April 18, the fourth course “Contract Performance, Waiver and Estoppel” was lectured by Mr. Yang Liangyi himself. Mr. Yang Liangyi combined his many years of experience in international commercial arbitration and judicial practice to explain the key issues in contract performance in simple terms.
Strict Performance Principle and Flexible Exceptions
Mr. Yang Liangyi pointed out that English contract law adheres to the strict performance principle, that is, the parties must perform their contractual obligations in full and in accordance with the contract. However, in practice, there are also flexible exceptions, such as frustration of contract and impossibility of performance. Taking the COVID-19 pandemic as an example, he analyzed that many international trade contracts could not be performed due to the impact of the pandemic. At this time, the court or arbitral tribunal would judge whether the contract could be frustrated according to the principle of frustration of contract, so as to exempt the parties from performance obligations.
Waiver and Estoppel: The “Self-restraint” Mechanism of Rights
Waiver and estoppel are important legal mechanisms to balance the rights and interests of the parties in contract performance. Mr. Yang Liangyi explained that if a party clearly expresses or implies that it waives its right to claim for the other party’s breach of contract, it cannot claim this right again afterwards. In the case of Hughes v Metropolitan Railway Co (1877) 2 App Cas 439, the House of Lords held that the landlord’s failure to exercise the right to terminate the contract within the agreed time constituted a waiver, and could not terminate the contract afterwards. This case established the basic principle of the waiver system in English contract law.
Estoppel is a more restrictive mechanism. If a party makes a clear representation to the other party, and the other party relies on this representation to make a corresponding behavior, the representing party cannot deny the content of the representation afterwards. Mr. Yang Liangyi took a lease contract dispute as an example. The landlord verbally promised to reduce the rent, and the tenant paid the rent according to the reduced amount for six months. Later, the landlord claimed the full rent. The court held that the landlord was estopped from denying the rent reduction promise, and should be bound by this promise.
V. Course Feedback: Building a Professional Team of Foreign-related Lawyers
After the courses, the participating lawyers said that this series of courses had high professional standards and strong practical guidance, which helped them systematically master the knowledge of English contract law and international commercial arbitration. A lawyer from a foreign-related law firm said: “The cases analyzed in the courses are very close to our actual business. The explanations of the experts have solved many doubts in our practice, which is very helpful for us to handle foreign-related disputes in the future.”
The relevant person in charge of the Tianjin Lawyers Association said that they will continue to carry out such high-level foreign-related legal training courses to improve the professional level of Tianjin’s lawyers in international commercial arbitration, and provide better legal services for the development of Tianjin’s foreign trade economy.