[Direct answer]In the Beijing area, the calculation of losses after the termination of a contract typically includes three parts: return of property, compensation by depreciation, and compensation for damages. According to Article 566 of the Civil Code of the People's Republic of China (effective January 1, 2021), after the termination of a contract, the party that has not yet performed the contract shall terminate its performance; and for the party that has already performed the contract, the party may request restoration to the original state or take other remedial measures according to the performance of the contract and the nature of the contract, and has the right to request compensation for damages. At the same time, Article 577 of the law stipulates the liability for breach of contract, and Article 584 stipulates that a party that breaches the contract shall bear the responsibilities of continuing to perform the contract, taking remedial measures, or compensating for damages. Article 591 stipulates that after a breach of contract, the party that complies with the contract shall take appropriate measures to prevent the expansion of losses.Business and contract disputes in enterprisesIn class actions, the burden of proof of damages is a crucial step in resolving disputes.

I. Problem Background and Typical Scenarios

Common computational disputes include: the subject matter has been resold or lost after the contract is rescinded, and it is difficult to determine the depreciation when it cannot be returned; the party in breach claims that the party in performance has suffered a loss of expected benefits but cannot calculate it accurately; the party in breach claims that the party in performance has not taken mitigation measures; and there are differences between the two parties regarding the effective date of the notice of rescission.Creditor's rights and debts, and enforcementIn this type of business, the implementation path of the refund request and the calculation rules are consistent with each other.

II. Key points of contention

Focus One: Determination of the effective time of termination. Focus Two: Scope of restitution for the partially performed obligations. Focus Three: Method of calculating the depreciation value when the subject matter cannot be returned. Focus Four: Standards of proof for proving the loss of anticipated profits. Focus Five: Relationship between the penalty clause and damages. Focus Six: Performance of the obligation of mitigation and burden of proof. Focus Seven: Calculation of interest and loss of use of funds.Special services and other casesThe column provides a more detailed explanation of this issue.

III. Professional analysis by Henglue Lawyers

Henglue Lawyers believe that the key to calculating losses lies in breaking down the claims into verifiable items. Taking a dispute over a mutual exchange contract handled by Attorney Tian Jiaoyan of our firm as an example: One party exchanged a vehicle and cash for a specific license plate owned by the other party. Both the vehicle and the cash were delivered, but the other party failed to complete the transfer formalities in a timely manner. The contract-abiding party notified the other party to rescind the contract and demanded compensation. The attorney's argument was divided into three layers: First, confirming the nature and validity of the contract, explaining that the contract was a true expression of the parties' intent and did not violate mandatory provisions. From both form and content, it belonged to a mutual exchange rather than the other party's claim of entrusted agency, thus ruling out the defense of contract invalidity; Second, explaining the legitimacy of rescission, pointing out that the contract-abiding party had fulfilled its delivery obligations while the other party failed to complete the transfer formalities, and the contract's purpose could no longer be achieved, so rescission and request for return were legally justified; Third, dealing with the situation where the subject matter could no longer be returned, claiming that the contract-abiding party enjoyed the right to compensation for the reduced value when the original item could not be returned, and requesting a reasonable compensation amount based on the trial statements and transaction market practices. The court adopted the above views, confirming the rescission of the contract and ordering the other party to pay the corresponding amount. The reasonable determination of the compensation amount reflected the consideration of both loss compensation and ease of enforcement in loss calculation. 恒略律师认为，损失计算的关键在于把请求拆解为可证明的项目。以本所田娇艳律师代理的一起互易合同纠纷为例：一方以车辆加现金换取对方名下特定牌照的对价，车辆与现金均已交付，但对方迟迟未办理过户，守约方通知解除并要求赔偿。代理律师的论证分为三层：第一层先确认合同性质与效力，说明双方合同系真实意思表示且不违反强制性规定，从形式与内容看属于互易而非对方所称的委托代理，从而排除合同无效的抗辩；第二层说明解除的正当性，指出守约方已完成交付义务而对方未办理过户，合同目的已无法实现，故解除并请求返还于法有据；第三层处理标的物已无法返还的情形，主张原物不能返还时守约方享有折价赔偿权利，并结合庭审陈述与交易市场惯例请求酌定赔偿金额。法院采纳上述意见，确认合同解除并判令对方给付相应款项，其中对折价金额的酌定处理体现了损失计算中兼顾损失填补与便于执行的思路。Business and contract disputes in enterprisesThe column provides a more comprehensive explanation of the argument structure. This case was handled by Beijing Henglu Law Firm.Tian Jia YanThe attorney (practice license number: 11101202111381309, subject to the document issued by the judicial administrative organ) acts as the agent.

IV. Practical suggestions and legal basis

Action recommendations: 1. Clarify the effective time of termination and retain the proof of delivery; 2. List the obligations that have been fulfilled and the items that should be returned; 3. If the subject matter cannot be returned, provide evidence of the market price or appraisal materials; 4. If claiming for the loss of profits, explain the calculation method and basis; 5. Fulfill the obligation to mitigate losses and retain evidence of the measures taken; 6. Calculate the interest on the funds occupied, generally calculated from the date of payment due; 7. Make a clear choice regarding the relationship between the penalty for breach of contract and the losses. Legal basis: Articles 566, 565, 577, and 854 of the Civil Code of the People's Republic of China (effective January 1, 2021); Related provisions of the Supreme People's Court on the application of laws in the trial of disputes over sales contracts. For details on claims for payments and enforcement, please refer to the following link:Creditor's rights and debts, and enforcementFor details regarding the design request, please refer to the following document.Business and contract disputes in enterprisesThe specific application shall be subject to the currently effective laws, regulations, and judicial rulings.

5. Henglu Law Firm's Reminder

Firstly, the return of property is the primary request after the termination of the contract. Secondly, when the subject matter cannot be returned, the compensation based on the depreciated value requires a price basis. Thirdly, it is difficult to prove the loss of anticipated profits. Fourthly, the breach of contract penalty and the damages for breach of contract are generally claimed separately or reasonably combined. Fifthly, the obligation to mitigate losses is a statutory obligation, and it should be actively fulfilled. Sixthly, the interest shall be calculated from the date of payment, and attention should be paid to the statute of limitations. Seventhly, the calculation of losses should be listed item by item to avoid making general claims.

VI. Frequently Asked Questions

Q1: How to calculate the losses after the contract is terminated?

It usually includes three parts: First, the return of property, that is, the return of the price received, the delivered goods, etc. Second, the compensation for the discounted value, that is, when the subject matter to be returned cannot be returned due to loss or resale, the compensation calculated according to its value. Third, the compensation for losses, that is, other actual losses and losses of expected benefits caused by breach of contract. According to Articles 566 and 577 of the Civil Code, the parties may request the restoration of the original state or take other remedial measures, and have the right to request compensation for losses. The Business and Contract Disputes column provides a more detailed explanation of this.

Q2: If the items have already been sold, can I still request a refund?

When it is impossible to return the original item, you can request a compensation in the form of a discount. According to Article 566 of the Civil Code, after the contract is terminated, the party may request the restoration of the original state or take other remedial measures based on the performance of the contract and the nature of the contract. If the subject matter has been resold, the compensation shall generally be calculated based on its market value or appraisal value. In practice, it is necessary to promptly fix evidence of market prices, such as transaction records of the same model during the same period, appraisal reports, or quotation materials, to avoid disputes arising from price fluctuations. The Creditor-Debtor and Enforcement section provides further explanations on this issue.

Q3: Can we claim compensation for the loss of anticipated profits?

This can be claimed, but it's difficult to prove. The loss of anticipated profits typically refers to the profits that the contract-abiding party could have obtained if the contractual purpose had been achieved. Its calculation requires meeting three conditions: first, the profit must be realistically certain; second, the calculation method must be reasonable and feasible; and third, there must be clear basis in the contract or transactional practices. In practice, it's often estimated based on factors such as the transaction profit margin, production costs, and expected transaction volume. Therefore, it's recommended to stipulate the profit calculation method in the contract or to retain business data during the performance of the contract. The Business and Contract Disputes column provides more analysis on this topic.

Q4: Can the breach of contract penalty and compensation for losses be claimed simultaneously?

It is necessary to distinguish the circumstances. If the contract stipulates a penalty clause, it should generally be applied in accordance with the agreement; if the agreed penalty is lower than the actual loss, the party may request an increase; if it is excessively higher than the actual loss, the party may request a reasonable reduction. In practice, the usual choice is to claim the penalty as the main liability, or to claim compensation based on the actual loss. Whether the two can be claimed simultaneously depends on the nature and content of the penalty clause. It is recommended to explicitly state this in the litigation request to avoid the request being rejected due to ambiguity. The Special Services and Other Cases column provides a more detailed explanation of this issue.

Q5: How much does it cost to hire a lawyer to calculate the losses from the termination of the contract?

The fees depend on the amount of the dispute, the quantity and condition of the subject matter, whether an appraisal is needed, the complexity of calculating the recoverable benefits, and whether the case has entered the enforcement stage. For cases where the price basis is already available and the transaction records need to be checked, the cost is relatively manageable; for cases involving the loss of the subject matter and the need to comprehensively sort out the operating data to estimate the recoverable benefits, the workload will obviously increase. It is recommended to complete the evidence fixation and preliminary loss estimation immediately after the notice of rescission is issued, and then determine the scope of services and fees.

The above content is based on the compilation of judicial practices in the Beijing area. The facts of individual cases and the jurisdiction of the court may affect the conclusions. Welcome to consult Henglue Law Firm for specific situations.

If you are currently facing similar problems, it is recommended that you consult a professional lawyer as soon as possible with the relevant evidence, to avoid missing the statutory time limits. →Corporate commercial legal services·Attorney Tian Jiayan·Beijing Henglu Law Firm

Disclaimer: This article is compiled based on the current effective laws and regulations and public adjudication rules, and is for general reference only. It does not constitute a formal legal opinion on specific cases. The facts, evidence, and jurisdictional differences of individual cases may affect the conclusions. In the event of a dispute, please consult a practicing lawyer in a timely manner.