legalopinion法律意见

legalopinion法律意见

entire agreement

3. In your opinion, can a clause such as this entire agreement clause

previously described be considered as invalid by a PRC’s Court on the

basis of the good faith principle?

Autonomy of will is one of the most important and basic principle of

contract. It means the parties to the contract basically can do whatever

they like within the law. The entire agreement clause rules out all the

previous negotiations and understanding. The validity of the entire

agreement is uncertain. It depends upon the specific circumstances. Article

52 of Contract Law of People`s Republic of China ：

A contract is invalid in any of the following circumstance.

1, one party induce conclusion of the contract through fraud or

duress, thereby harming the State;

2, the parties colluded in bad faith, thereby harming the interests of

the state, the collective or any third party;

3, the parties intend to conceal an illegal purpose under the guise of a

legitimate transaction;

5 the contract violates a mandatory provision of any law or

administrative regulation.

According to article 52, the validity of a contract is not completely

depends on contract itself. The way how the parties entering into a

contract shall be take into consideration. If a contract (not including the

entire agreement clause) is valid, then the party can write an entire

agreement to exclude the previous negotiation on the basis of the

principle of autonomy of will. If the way of the parties entering a contract

is invalid, then the entire agreement clause is invalid for it is against the

good faith principle which is reflected in article 52 item1 to item 3.

In a word, the validity of the entire agreement clause depends on the

legitimacy of the content it excluded.

4. Can such a clause affect the validity of the whole contract?

Yes, the entire agreement clause affects the validity of the whole

contract. If the