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VOL. 12, ISSUE 1 (2026)
The doctrine of efficient breach of contract and implications for Vietnamese law in the market economy context
Authors
Nguyen Phong Yen Chi, Pham Nhu Quynh, Ninh Thi Thao
Abstract
The doctrine of “efficient breach of contract”
is a significant contribution of Law and Economics, shifting the traditional
approach that views contract breach through a moral-legal lens. According to
this doctrine, a breach is not always negative; in certain cases, it can
generate a net social benefit if the breaching party fully compensates the
aggrieved party while still securing a greater value from a new opportunity.
This article analyzes the origins and practical values of the doctrine, while
distinguishing between efficient breach and ordinary breach based on their
nature, purpose, and market impact. On that basis, the research examines cases
of efficient breach categorized by the subjects and objects involved, as well
as the types of benefits derived from the breach. When compared with Vietnamese
law, the article identifies inadequacies such as regarding specific performance
as the central remedy and the lack of economic criteria in evaluating breaches.
Finally, the article proposes several recommendations for the controlled
application of this doctrine in Vietnam.
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Pages:353-359
How to cite this article:
Nguyen Phong Yen Chi, Pham Nhu Quynh, Ninh Thi Thao "The doctrine of efficient breach of contract and implications for Vietnamese law in the market economy context". International Journal of Law, Vol 12, Issue 1, 2026, Pages 353-359
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