Opinions on Several Issues Concerning the Trial of Cases of Disputes over Construction Contracts

Opinions of the Jiangsu Provincial High People's Court on Several Issues Concerning the Trial of Cases of Disputes over Construction Contracts

Issuing Authority: Jiangsu Provincial High People's Court

Effective date: December 17, 2008

In order to unify the law enforcement standards of courts in the province in hearing construction contract dispute cases, these Opinions are formulated in accordance with laws, administrative regulations and judicial interpretations such as the General Principles of the Civil Law of the People's Republic of China, the Contract Law of the People's Republic of China, the Construction Law of the People's Republic of China, the Tendering and Bidding Law of the People's Republic of China, and the Interpretation of the Supreme People's Court on Several Issues Concerning the Application of Law in the Trial of Construction Contract Dispute Cases, and in light of the actual situation of our province.

Article 1 The provisions of these Opinions shall apply to disputes over construction contracts for construction projects where the employer pays the project price due to the contractor's construction of the project.

The provisions of these Opinions do not apply to cases of labor contract disputes and family home decoration contract disputes.

Article 2 Where the agreement between the employer and the contractor stipulates that the house shall be directly offset against the project price and the employer no longer has rights over the house, the dispute arising from the non-performance of the agreement is a dispute over the housing sales contract and the provisions of these Opinions shall not apply.

Article 3 In any of the following circumstances, if a party requests confirmation of the invalidity of a construction contract, the people's court shall support it:

(1) The contractor has not obtained the qualifications of a construction enterprise or has exceeded the qualification level;

(2) The actual builder without qualifications borrows the name of a qualified construction enterprise;

(C) the construction project must be tendered but not tendered or the bid is invalid;

(4) The contractor subcontracts or illegally subcontracts the project;

(E) the bid contract agreed on the price of the project is lower than the cost price;

(6) Other circumstances provided for by laws and administrative regulations.

Article 4 In any of the following circumstances, it shall be determined that the actual builder without qualifications shall contract the construction project in the name of a qualified construction enterprise (commonly referred to as "affiliation"):

(A) do not have the qualifications to engage in construction activities of the main body of the individual, partnership organization or enterprise in the name of the qualification to engage in construction activities in the name of the construction enterprise;

(2) Construction enterprises with low qualification levels contract projects in the name of construction enterprises with high qualification levels;

(3) A construction enterprise that does not have the qualification of general contracting of the project shall contract the project in the name of the construction enterprise with the qualification of general contractor;

(4) Qualified construction enterprises allow others to contract projects in the name of the enterprise through other illegal means.

Article 5: In any of the following circumstances, contractors may be found to be "affiliation" as provided for in Article 4 of these Opinions:

(1) There is no connection between them with property rights, that is, there is no transfer of assets in the form of shares;

(2) There is no unified financial management, and independent accounting is carried out separately or in disguise;

(3) There are no personnel appointments, removals, transfers, or employment procedures that meet the requirements of the provisions;

(4) Other circumstances provided for by laws and administrative regulations.

Article 6 The warranty period of the project under normal use conditions agreed in the construction contract is lower than the minimum period stipulated by laws and administrative regulations, and the parties request confirmation that the agreement is invalid, the people's court shall support it.

Article 7 Where a construction contract concluded through bidding and bidding is qualified, but the contract is invalid because the project price agreed in the contract is lower than the cost price, and the employer requests to settle the settlement with reference to the price agreed in the contract, the people's court shall support it.

Article 8 After the construction contract comes into effect, the parties have no agreement on the relevant content or the agreement is not clear, it may be supplemented by agreement; If a supplementary agreement cannot be reached, it shall be determined in accordance with the relevant provisions of the contract or with reference to the general terms of the Construction Contract (Model Text) jointly implemented by the Ministry of Construction and the State Administration for Industry and Commerce.

Article 9 If the construction contract stipulates that the project price shall be settled at a fixed price, and one party requests to settle the project price according to the fixed amount, the people's court shall not support it, except for major changes in the price of raw materials during the performance of the contract.

Where the construction contract stipulates that the project price shall be settled at a fixed price, and the parties request that the increase or decrease in the quantity of the project be settled according to the actual settlement due to the change in the design and the change in the quantity of the project, unless otherwise agreed by the parties.

Article 10 The construction contract clearly stipulates that after the employer receives the completion settlement documents, if it does not reply within the time limit agreed in the contract, it shall be deemed to approve the completion settlement documents, and the parties request that the project price be settled in accordance with the completion settlement documents, the people's court shall support it; If there is no clear agreement in the construction contract of a construction project, and the parties request that the project price be settled in accordance with the completion settlement documents, the people's court shall not support it.

11th laws, administrative regulations must be through the bidding of the construction project, the parties to the actual performance of the construction contract and the substantive content of the record of the contract is inconsistent, should be filed with the record of the contract as the basis for the settlement of the project price; If the construction contract is invalid without bidding, the contract shall be invalid and shall be based on the settlement of the project price with reference to the actual performance of the contract.

For construction projects that are not subject to bidding and bidding that are not stipulated by laws and administrative regulations, the contract actually performed by the parties shall be used as the basis for the settlement of the project price; After bidding and bidding, if the construction contract actually performed by the parties is inconsistent with the substantive content of the winning contract, the winning contract shall be used as the basis for the settlement of the project price.

Article 12 Where the price of a construction project is appraised, and the construction materials such as the project visa form issued by the contractor are flawed, and the appraisal agency has not identified them, and the contractor requests that the corresponding project price be paid in accordance with the project visa form and other construction materials, the people's court shall not support it, except where the parties have evidence to prove that the project content stated in the project visa form and other construction materials has indeed been completed.

Article 13 For a construction project invested by the State finance, if the parties have not agreed in the contract that the audit and audit results of the State finance department or the State audit department shall be used as the basis for the settlement of the project price, and the contractor requests to settle the project price in accordance with the contract, the people's court shall support it.

Article 14: Where the contractor requests the employer to pay the project price in accordance with the construction contract, and the employer requests that the portion already paid to the actual contractor be deducted, the people's court shall support it, except where the contractor has evidence to prove that the employer and the actual contractor maliciously colluded.

Article 15 The employer shall promptly examine the project completion settlement documents submitted by the contractor. Where the employer refuses to settle the settlement on the grounds that the completion settlement documents submitted by the contractor are incomplete after the expiration of the time limit for review and settlement agreed in the contract, and the contractor requests that the interest on the project price be calculated from the date of expiration of the period for review and settlement agreed in the contract, the people's court shall support it.

Article 16 Where after the completion of a construction project and the experience is qualified, the contractor requests the employer to pay the price of the project, and the employer raises objections to the quality of the project and requests an appraisal of the project, the people's court shall not support it.

Where a construction project is completed but has not been accepted, and the contractor requests the employer to pay the project price, and the employer raises objections to the quality of the project and requests an appraisal, the people's court shall support it.

Article 17: Where the parties have jointly selected an appraisal agency with corresponding qualifications to make an appraisal conclusion on a construction project before litigation, and one of the parties in the litigation requests a new appraisal, the people's court will not support it, except where there is evidence to prove that the appraisal conclusion has the circumstances provided for in the first paragraph of article 27 of the "Several Provisions of the Supreme People's Court on Evidence in Civil Proceedings".

Article 18 Where the construction project has been completed and accepted, and the employer and the contractor sign a project transfer agreement, the handover date agreed in the agreement shall be regarded as the delivery date of the construction project; If the agreement does not stipulate the date of handover, the date of signing the agreement shall be regarded as the date of delivery of the construction project.

Article 19 Where a construction project has been completed, the time limit for exercising the contractor's right of priority to be compensated for the project price shall be six months from the date of completion of the construction project; If the construction project is not completed, the time limit for exercising the contractor's priority right to be compensated for the project price shall be six months from the date of completion as agreed in the construction contract.

Article 20 Where the contractor assigns the creditor's right to the price of the construction project, the priority right to be repaid for the price of the construction project shall be transferred accordingly.

Article 21 The scope of the contractor's priority right to compensation shall be limited to the project price agreed in the construction contract, including the actual expenses such as staff remuneration, material payment, and advance funds for the construction project that the contractor shall pay.

Loans not used for construction projects, liquidated damages payable by the employer, or losses caused by the employer's breach of contract do not fall within the scope of the priority right to be reimbursed for the construction project price.

Article 22 Where the contractor's project department or project manager concludes a contract in the name of the contractor, and the creditor demands that the contractor bear civil liability, the people's court shall support it, except where the contractor has evidence to prove that the creditor knew or should have known that the project department or the project manager did not have agency authority.

Article 23: Where the actual constructor claims payment for the project with the employer as the defendant, the people's court shall generally add the subcontractor or illegal subcontractor as the defendant to participate in the litigation.

Where the construction contract of a construction project is invalid due to subcontracting or illegal subcontracting, and the actual constructor requests that the subcontractor, the illegal subcontractor and the employer bear joint and several liability for the arrears of the project, the people's court shall support it, but the employer shall only bear joint and several liability within the scope of the outstanding project payment.

If the actual constructor requests the employer to pay the project money, and the employer defends that the actual constructor's request for payment is higher than the unpaid project price, the employer shall bear the burden of proof.

Article 24: Where one of the parties to a contract for the cooperative development of real estate signs a construction contract with the contractor as the employer, and the contractor demands that the cooperating parties bear joint and several liability for the unpaid project money, the people's court shall support it.

Article 25 Where the sponsor enters into a construction contract in the name of the sponsor, the sponsor and the sponsor shall bear joint and several liability for the civil liability arising from the performance of the contract.

Article 26 The employer shall be responsible for the losses caused thereby if the employer changes the project plan or design without the consent of the design and planning departments, and the contractor carries out the construction in accordance with the instructions of the employer; If a third party suffers a loss, the employer and the contractor shall be jointly and severally liable.

Article 27 Where a construction contract stipulates that the contractor may impose a fine on the contractor due to circumstances such as duration, quality, subcontracting, or illegal subcontracting, such agreement shall be deemed to be a liquidated damages clause agreed upon by the parties in the contract, and where the parties request adjustment in accordance with the provisions of Article 114 of the Contract Law of the People's Republic of China, the people's court shall support it.

Article 28: The people's courts may collect profits obtained by contractors from subcontracting or illegally subcontracting construction projects, as well as management fees paid by the actual constructors.

Article 29: These Opinions take effect on the date of their issuance.

The provisions of these Opinions apply to first- and second-instance trial cases accepted or currently being tried after the implementation of these Opinions; The provisions of these Opinions do not apply to cases where a final trial has already been made before the implementation of these Opinions, and the parties apply for a retrial or decide to retry in accordance with the trial supervision procedures.

Where this court's previous relevant provisions conflict with these Opinions, they are no longer applicable.

Where laws, administrative regulations, or judicial interpretations make new provisions after these Opinions take effect, follow those provisions.

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