On Compensation for Mental Distress in Breach of Contract Attached Analysis of Article 81 of China Civil Code: Contract (Proposal Draft)

It is widely believed that compensation for damages in breach of contract be limited to property losses, not including mental distresses. Mental distresses caused by breach of contract can be dealt with rules of competitive liabilities .The author argues that rules of competitive liabilities cannot compensate all the losses of the concerned party. After studying foreign laws, the author suggests under the control of prospectivity ,some mental distresses should be included in the liabilities of breach of contract.