Guidelines for the Trial of Construction Contract Cases

Hebei Provincial High People's Court Guidelines for the Trial of Construction Contract Cases

Issuing authority: Hebei Provincial High People's Court

Document number: Ji Gao Fa [2018] No. 44

Date of Issue: 2018-06-13

In order to correctly adjudicate construction contract disputes, accurately apply the law, and standardize the exercise of discretionary power, this trial guide is formulated in accordance with 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 (hereinafter referred to as the "Judicial Interpretation of the Supreme People's Court on Construction Project Cases"), and other laws, administrative regulations and judicial interpretations, combined with the actual situation of our province.

1. The issue of determining the validity of the construction contract of the construction project

1. If the employer fails to obtain a planning permit for construction land or a planning permit for a construction project, the construction contract signed with the contractor shall be deemed invalid. However, where two certificates are obtained before the conclusion of the first-instance trial court's debate, or construction is approved by the competent departments, it may be found to be valid. The employer has gone through the formalities for the right to use the construction land, but has not yet obtained the construction land use right certificate, which does not affect the validity of the contract. If the employer fails to obtain a construction permit, the validity of the contract shall not be affected.

2. If a party claims that the construction contract signed by the party is invalid on the ground that the commercial housing development has not been subject to the bidding procedure, the people's court shall support the development project if it complies with the compulsory bidding project provided for in Article 3 of the People's Republic of China Bidding Law and Articles 6 and 9 of the Measures for the Implementation of the <People's Republic of China Bidding Law of Hebei Province and Article 9 of the Measures for the Implementation of the > of the Bidding and Bidding Law of Hebei Province. However, according to the State Council's "Opinions on Promoting the Sustainable and Healthy Development of the Construction Industry" (No. 19 of 2017), in the construction project of private investment, the construction unit can independently decide the way of awarding the contract.

3. For construction projects that must be tendered by laws and administrative regulations, and the parties claim that the construction contract is invalid on the grounds that the bidding procedures are illegal, or there are collusion in bidding, overt and covert bidding, etc., the people's court shall bear the corresponding burden of proof, and if the people's court finds that the above circumstances do exist after examination, the construction contract of the construction project shall be invalid.

4. Where a construction enterprise signs a contract with its subordinate branches or registered employees, subcontracts all or part of the project contracted by it to its subordinate branches or employees for construction, and provides support in terms of capital, technology, equipment, manpower, etc., it may be deemed to be an internal contracting contract of the enterprise. To determine whether it is a registered employee of an enterprise, it shall be determined by means of a written labor contract, proof of social security payment, proof of salary payment and other evidence. The internal employees of the enterprise and its subordinate branches shall not separately claim the project payment, and the contract signed by the construction enterprise and the contractor without construction qualifications is called internal contracting of the enterprise, but in fact it is a borrowed qualification, and the people's court shall not support the party's claim that the contract is valid.

5. The following circumstances may be identified as illegal labor subcontracting: (1) the general contractor or professional subcontractor subcontracts the labor service of the construction project to enterprises and individuals who do not have the corresponding qualifications; (2) The general contractor and professional subcontractor subcontract the labor operation of the construction project to the enterprise with corresponding qualifications, but the content of the subcontract includes the provision of large-scale machinery, turnover material leasing and main materials and equipment procurement; (3) The labor operation contractor subcontracts the contracted labor service.

Second, the settlement of the project price and related issues

6. If the construction contract of the construction project is invalid, both the employer and the contractor have the right to request payment of the project price with reference to the contract; Where the contractor requests that the settlement be made separately in accordance with the fixed amount or according to the facts, the people's court will not support it.

7. If several construction contracts entered into by the parties for the same construction project are found to be invalid, the project price shall be settled with reference to the contract agreed upon by the parties in terms of true intention and actual performance when settling the project price. If the parties have already reached a settlement statement based on one of the contracts, if there are no reasons for revocation such as fraud or coercion, the settlement statement shall be deemed valid. If it is not possible to determine the true intention of the parties and actually perform the contract, the project price may be determined by reasonably allocating the price difference between several contracts between the parties in combination with factors such as the fault of the contract, the quality of the completed project, and the balance of interests.

8. For construction projects that are not required by laws and administrative regulations to be tendered, after legal and effective bidding procedures, 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.

9. If the construction project that the laws and administrative regulations do not stipulate that bidding must be carried out, and in fact it has not been tendered, the parties shall sign a contract with different substantive content after filing the construction contract signed by the two parties according to the requirements of the local administrative department, and the contract actually performed by the parties shall be used as the basis for the settlement of the project price.

10. If the parties only stipulate in the contract that the employer shall reply within the agreed time limit after receiving the completion settlement documents, but do not expressly agree that failure to reply within the time limit shall be deemed to be approval of the completion settlement documents, the provisions of Article 20 of the Judicial Interpretation of the Supreme People's Court on Construction Projects shall not apply. If the contractor only requests the employer to settle the project price in accordance with the completion settlement document in accordance with Article 33.3 of the general clause of the construction contract form document formulated by the Ministry of Construction, which states that "if the employer fails to pay the project settlement price without justifiable reasons within 28 days after receiving the completion settlement report and settlement materials, the employer shall pay the interest on the arrears of the project price according to the contractor's loan interest rate to the bank for the same period from 29 days onwards and bear the contract liability", the people's court shall not support it.

11. If the contract stipulates a fixed price, if the project is changed due to the reasons of the employer, the contractor can prove that the project quantity increased by the project change does not fall within the scope of the lump sum price agreed in the contract, and if there is an agreement, the project price shall be settled according to the agreement, and if there is no agreement, the increase or decrease in the project quantity may be settled separately with reference to the contract standard, and if the settlement cannot be made with reference to the agreed standard, it may be settled with reference to the pricing method or valuation standard issued by the construction administrative department of the construction site. The party claiming the adjustment shall bear the burden of proof on the specific scope of construction agreed in the contract, the reasons for the increase or decrease in the actual construction quantity, the quantity, and other facts.

12. If the construction project has not yet been completed, and the parties have a dispute over the cost of the completed project, the project cost of the disputed part can be entrusted to appraisal, but the project price shall be calculated on the basis of the fixed price agreed in the contract and the proportion of the completed project in the construction scope agreed in the contract. That is, the appraisal agency calculates the price of the completed part of the project and the total price of the entire project agreed in the contract under the same fee collection standard, compares the two to calculate the corresponding coefficient, and then multiplies the fixed price agreed in the contract by the coefficient to determine the project price. If one of the parties claims to use the quota standard as the basis for cost appraisal, the people's court will not support it.

13. For the project that has not been completed, if the parties have a dispute over the quantity of the completed project, it shall be determined according to the meeting minutes, handover records, supervision materials, follow-up construction materials and other documents signed by both parties at the time of handover; If it cannot be determined, the burden of proof shall be reasonably allocated according to factors such as the failure to handle the handover when the project is completed and the reasons for the failure to complete the project. If the employer maliciously evicts the contractor or compels the contractor to leave the site, and the employer does not recognize the quantity claimed by the contractor, the employer shall bear the burden of proof. If the employer fails to provide the relevant evidence, it shall bear the adverse consequences of failing to provide evidence.

14. If a construction contract is invalid, and one of the parties requests the other party to compensate for the losses suffered by it due to the invalidity of the contract in accordance with Article 58 of the Contract Law, the people's court shall make a determination and ruling in accordance with the principles of good faith and fairness based on factors such as the degree of fault, the size of the loss, and whether there is a causal relationship between the loss and the fault of the other party.

15. After the construction contract is confirmed to be invalid, the employer claims that the contractor shall compensate for the breach of contract losses arising from the late delivery of the house in the housing sales contract signed with a third party due to the delay in the construction period, and the contractor is at fault for the delay in the construction period, the losses have actually occurred, and there is a causal relationship between the occurrence of the losses and the contractor's late delivery, which may be included in the scope of liability for the fault of the invalid contract. In accordance with the degree of fault liability and the principle of good faith in the conclusion and performance of the contract, the contractor shall be ordered to bear the corresponding liability in accordance with Article 58 of the Contract Law.

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

17. If the employer and the contractor agree to use land or commercial housing to offset the project price before the project price is determined, the agreement is a liquid contract and shall be deemed invalid. Where a party's request to continue to perform the debt repayment agreement is not supported. The people's court shall conduct an appraisal of the land or house involved in the case, and pay the contractor the project price after discounting the price. The remaining amount after the payment of the project price shall be returned to the employer; For the insufficient part, the contractor may make a separate claim against the employer.

18. After the project price is determined, including after the cost of the completed project is determined during the construction process, the employer and the contractor agree to use the land or commercial housing to offset the project price, and if the land or house transfer procedures have been completed, it shall be deemed valid. If the land or house transfer formalities have not been completed, and one party claims to continue to pay the arrears and interest of the project, the people's court shall support it.

19. In the course of the construction of a construction project, if the employer and the contractor settle the settlement and issue an IOU to confirm the outstanding debts, and the plaintiff sues on the basis of the IOU, and the defendant claims that the amount confirmed in the IOU is not the actual amount of the project payment, and requests confirmation that the IOU is invalid, it is generally not supported. Unless the defendant can provide evidence to prove that there was material misunderstanding, fraud, coercion or manifest unfairness at the time of issuing the IOU.

3. Issues related to audit conclusions and financial review opinions as the basis for settlement

20. Government investment and construction projects based on government investment, the contract clearly stipulates that the audit opinion issued by the audit institution shall be used as the basis for the settlement of the project price, and the audit department of the financial department shall be used as the basis for the settlement of the project price.

21. If the audit institution fails to make an audit conclusion within the time limit agreed in the contract, and the employer refuses to pay the project price on this ground, and the employer cannot provide evidence to prove that the audit institution has a legitimate reason to fail to issue an audit conclusion, the party applies for judicial appraisal of the project cost, and the people's court shall support it.

22. In the case that both parties have confirmed the settlement price of the project through the settlement agreement and have basically completed the performance, the audit conclusion or financial review opinion made by the state audit institution shall not affect the validity of the settlement agreement between the two parties.

Fourth, the construction project cost appraisal

23. Where the parties jointly entrust an appraisal agency with appraisal qualifications to make an appraisal conclusion on the project cost of the project involved in the case before litigation, and one of the parties in the litigation requests a new appraisal, the people's court will generally not approve it, unless there is evidence to overturn the appraisal conclusion. After the contractor submits an application for settlement, if the employer unilaterally entrusts an appraisal, and then the contractor sues for payment of the project price on the basis of the appraisal conclusion entrusted by the employer, it shall be handled as a pre-litigation jointly entrusted appraisal.

24. The employer has entrusted a qualified third party to review the settlement report provided by the contractor and signed and approved by both parties, or the two parties have completed the settlement of the project price and the settlement report has been signed and approved by both parties. Where one of the parties in the litigation requests a new evaluation, the people's court will not approve it.

25. If there is a dispute between the parties on the validity of the construction contract, the basis for settlement, the authenticity and validity of the visa documents, etc., the people's court shall examine and confirm whether it is used as the basis for settlement. After the people's court approves the application of the parties to appraise the project price, it shall, according to the needs of the parties' application and ascertaining the facts of the case, determine the matters and scope of the entrusted appraisal, and organize the parties to cross-examine the appraisal materials in dispute and determine the basis for appraisal. Where the parties are unable to reach a consensus on the appraisal materials submitted by the other party, the people's court cannot simply deny the solidity of the appraisal materials on the grounds that the parties do not approve them, and the people's court shall conduct a review of the disputed materials in accordance with law and determine whether they can be used as appraisal materials.

26. When entrusting an appraisal, the people's court may require the appraisal agency to make appraisal conclusions based on the different settlement bases claimed by the parties, or require the appraisal agency to make a separate list of the quantity and price of the doubtful part after appraisal for review and determination at trial, or the people's court may first make a clear conclusion on the disputed issue before initiating the appraisal procedure.

27. During the appraisal process, all parties have the obligation to submit appraisal materials. Where a party fails to submit appraisal materials within the time limit specified by the court during the appraisal process, and still fails to do so after being urged to do so, and is unable to give a reasonable explanation, it shall be deemed to have delayed the submission of appraisal materials and shall bear the legal consequences of failing to present evidence.

28. Where the people's court finds that it is necessary to conduct an appraisal on specialized issues such as the price of a construction project, it shall give a full explanation to the party bearing the burden of proof and clearly inform it of the adverse consequences that may be borne if it does not apply for appraisal. Where a party fails to apply for an appraisal after being explained, it may refer to the provisions of the Civil Procedure Law on the late presentation of evidence, and they shall bear the corresponding legal consequences. Where the party who bears the burden of presenting evidence in the first-instance litigation fails to apply for an appraisal of the project price, and applies for an appraisal in the second-instance litigation, the people's court may approve it. After the people's court approves it, it may remand the case back to the court of first instance for an evaluation, but the relevant provisions of the Civil Procedure Law must not be violated. For parties who have not applied for appraisal after the court of first instance has explained that they have not applied for an appraisal, the provisions of the Civil Procedure Law on the late presentation of evidence may be referred to to reprimand and fine the parties.

5. The identification of the actual constructor and the exercise of rights

29. The actual contractor is the opposite of the nominal contractor, and generally refers to the contractor who illegally subcontracts, illegally subcontracts, or contracts signed by borrowing qualifications (affiliation). The following circumstances may be identified as the actual constructor: (1) there are actual construction acts, including the purchase of materials, payment of workers' wages, payment of water and electricity bills, etc., during the construction process: (2) participation in the signing and performance of construction project contracts, (3) there are acts of investment or collection. In the following circumstances, it cannot be found to be the actual constructor: (1) internal employees of the construction enterprise: (2) migrant workers, construction workers, or construction team or team members who have no construction contract relationship with the illegal subcontractor or illegal subcontractor. The above-mentioned persons cannot directly claim rights against the employer, but can only claim rights against the actual constructor (contractor) based on the labor relationship or labor service relationship. If the construction project has been subcontracted several times, the actual constructor shall be the ultimate contractor.

30. Where a project is subcontracted or subcontracted multiple times, and the actual constructor sues the other party to the contract or the employer for payment of the project price, the general contractor shall be added as a third party in order to ascertain the amount owed by the employer, and the remaining illegal subcontractors or subcontractors may not be added as the subject of litigation in the case if they do not participate in the actual construction and do not affect the ascertainment of the facts of the case.

31. In the case of a lawsuit filed by the actual contractor against a subcontractor, subcontractor, general contractor or employer with whom the actual contractor has no contractual relationship, and the employer and the contractor have not yet settled the issue of the project payment, in principle, the relativity of the contract shall still be adhered to, and the former contractor who has a contractual relationship with the actual contractor shall pay the project price. If the employer and the contractor have settled the project payment or have not yet settled the settlement, but the scope of the arrears is clear, it can be determined that the amount owed by the employer to the contractor is greater than the number of project payments owed by the contractor to the actual constructor, and the employer may be directly ruled that the actual constructor shall be jointly and severally liable for payment to the extent of the amount of the construction money owed by the contractor to the actual constructor. The clear scope of the unpaid project payment means that the judgment must specify the scope and amount of the joint and several liability of the employer, and cannot simply be expressed as the joint and several liability of the employer within the scope of the unpaid project payment.

32. Where the contractor requests the employer to pay the project price, and the employer defends that the employer has paid the project price to the actual constructor, it shall provide evidence to prove the amount of the project payment and the reason for the payment, and the people's court shall support the payment if there is a special agreement on the payment, the contractor authorizes it, an effective ruling is confirmed, or there are other legitimate reasons.

6. The priority right to be compensated for construction projects

33. Where a construction contract is invalid, but the quality of the construction project is up to standard, and the contractor claims that the price of the construction project should be compensated in priority with respect to the price discounted or auctioned for the project, the people's court shall support it; Where the subcontractor or the actual contractor is negligent in claiming the price of the project when the general contractor or the illegal subcontractor is negligent in claiming the price of the project, the people's court shall support the claim that the price of the construction project shall be compensated in priority with respect to the price of the project at a discount or auction.

34. The scope of the price of the construction project entitled to the priority of compensation enjoyed by the contractor refers to the expenses incurred by the contractor for the work products completed, including direct costs, indirect costs, profits, taxes, staff remuneration, materials and other actual expenses, excluding losses arising from the employer's breach of contract. If the interest is the statutory interest on the project price, and the contractor's claim that the interest on the unpaid project price falls within the scope of the priority right to compensation of the project price, it should be supported. The land use right is not the object of the priority right of compensation, and the contractor's request for the value of the land use right within the scope of the construction project shall not be supported.

35. The time limit for the construction project contractor to exercise the right of priority for compensation shall be six months, and the specific starting time shall be determined in the following manner: (1) if the project has been completed, it shall be calculated from the date of completion of the construction project or the date of completion agreed in the construction project contract, and if the above dates are inconsistent, the later date shall be used as the starting point, but if the payment period agreed in the contract has not expired, the date of expiration of the payment period agreed in the contract shall be used as the starting point; (2) If the project has not yet been completed and the contract is dissolved or terminated, the date of actual rescission or termination of the contract shall be taken as the starting point; (3) If the employer claims that Article 14 (2) and (3) of the Judicial Interpretation of the Supreme People's Court on Construction Projects should be used as the starting point for the contractor's exercise of the right of priority to be compensated, it shall not be supported.

36. Where the parties confirm the right to priority compensation by means of mediation, the people's court shall review its legality in accordance with the law and refuse to confirm the mediation agreement in which the parties maliciously collude to harm the lawful rights and interests of a third party.

37. The right of priority for repayment of the price of the construction project and the right to claim for the price of the construction project are of a personal dependence, and the contractor transfers the creditor's right for the price of the construction project, and the priority right to be repaid for the price of the construction project is extinguished.

7. Project quality, return of warranty money and warranty responsibility

38. In the case of a construction contract dispute initiated by the contractor, if the employer requires the contractor to pay liquidated damages or compensate for reasonable costs of repair, rework or reconstruction on the grounds that the quality of the project does not conform to the contract or regulations, or the construction period is delayed, the employer shall be informed that it shall file a counterclaim and hear it together with the present lawsuit. If, after the contractor initiates a dispute over a construction contract, the employer separately sues the contractor in another court to assert the above-mentioned rights, the people's court shall inform the employer to file a counterclaim in the previous lawsuit. If the employer insists on filing the case, the court that files the case later shall take the initiative to transfer the case to the court that filed the case first for joint trial.

39. If the quality of the construction project does not conform to the agreement due to the fault of the contractor, and the employer can prove that it has fulfilled its obligation to notify, and the contractor refuses to repair, rework or reconstruct, and the employer requests a reduction in the project price, the expenses paid by the employer for repair, rework or reconstruction may be deducted from the project price.

40. If, after the construction project has passed the completion and acceptance, the contractor claims that the employer of the project payment is not satisfied or refuses to pay the project money on the grounds that the project quality is not up to standard, the people's court shall not support it.

41. Where a construction project has not been completed and accepted or has not passed the acceptance, and the contractor claims the payment for the project after the employer has used it for its own use, and the employer claims that the payment terms have not been fulfilled or the project payment is refused to be paid on the grounds that the quality of the used part is not up to standard, the people's court shall not support it. However, except for the quality problems of the foundation engineering and the main structure of the construction project caused by the contractor.

42. In the case of unfinished projects, if the contractor claims that the completed part of the project payment, the subsequent project has been completed by a third party and the completion acceptance is qualified, and the employer claims that the payment terms are not fulfilled or the project payment is refused on the grounds that the quality of the contractor's construction part is not up to standard, the people's court shall not support it. Where the follow-up project has already been completed by a third party but has not been completed and accepted, or the third party has not continued the construction, but the sub-items have passed the acceptance of the sub-items, and the employer claims that the payment terms have not been fulfilled or that the project payment has not been paid on the grounds that the quality of the contractor's construction part is unqualified, the people's court will not support it. The people's court may temporarily withhold the warranty money from the contractor's completed project price in accordance with the proportion agreed in the contract, and the period of temporary withholding of the guarantee money shall not exceed two years. However, except for the quality problems of the foundation engineering and the main structure of the construction project caused by the contractor.

43. Where the parties have agreed on the time limit for the return of the quality deposit, and the contractor requests the return of the project quality deposit in accordance with the agreement, the people's court shall support it. If there is no agreement or the agreement is unclear, Article 2 of the Measures for the Administration of Quality Deposit for Construction Projects (Jianzhi [2016] No. 295) shall apply, and the maximum liability period for defects shall be 2 years. The employer shall return the quality deposit to the contractor after the expiration of the maximum defective term (2 years). The term of the quality deposit shall be calculated from the date of acceptance of the completion of the project; If the project fails to be completed and accepted due to reasons attributable to the employer, it shall be counted from 90 days after the contractor submits the project completion acceptance report. After the employer returns the quality deposit, it will not affect the contractor's performance of the project warranty obligation in accordance with the contract or the law.

44. If the employer uses a project that has not been accepted or is unqualified without acceptance, it shall be deemed that the project has been completed and accepted, but the contractor's warranty liability shall not be excluded during the warranty period of the project.

45. Where it is stipulated in the construction contract that the employer may impose a "fine" on the contractor due to the construction period, project quality subcontracting, illegal subcontracting, etc., such agreement shall be deemed to be an agreement between the two parties on the liability for breach of contract, and the fine shall be in the nature of liquidated damages. If the employer claims to deduct the amount of the fine confirmed by the contractor from the project payment, the people's court shall support it. If the parties request an adjustment of the amount of the fine, the people's court may handle it in accordance with the provisions of Article 114 of the Contract Law.

46. If the employer has not obtained a construction permit, but the contractor has actually started construction, the date of commencement of construction shall be the date of commencement of construction, unless otherwise agreed in the contract. If the administrative department orders the construction to stop because the construction permit has not been obtained, it may be used as a reason for the extension of the construction period.

47. The responsibility for the delay shall be borne by the party at fault for the delay in the construction period, and if the employer claims that the construction period cannot be extended only on the ground that the contractor has not submitted an application for extension of the construction period within the time limit agreed in the contract, the people's court shall not support it.

48. In the course of the performance of a construction contract, if the contractor commits a breach of contract such as delay in the construction period due to mismanagement or other reasons, the people's court shall accurately understand and grasp the provisions of Article 113 of the Contract Law, and comprehensively determine the amount of compensation by considering the contractor's fault, the expected benefits of performing the construction contract, and the actual losses of the employer.

8. The external responsibility of the contracting entity

49. Where the sponsor signs a sales contract with the material and equipment supplier in its own name, and the material and equipment supplier sues the affiliated unit to bear the responsibility of the contract, it will not be supported. If the affiliated party signs a contract in the name of the affiliated unit, the affiliated unit and the affiliated party shall generally be jointly liable, but if the material and equipment supplier clearly knows the fact of the affiliated party when signing the contract and sues the affiliated party to bear the contractual liability, the people's court will not support it. If an illegal subcontractor or illegal subcontractor signs a sale, lease or other contract in the name of the project department of the construction enterprise without the authorization of the construction enterprise, the provisions of Article 49 of the Contract Law shall apply to whether the construction enterprise bears civil liability. If there is evidence to prove that the subject matter of the contract is used in the project or that the construction enterprise has recognized the acts of the project department during the performance of the construction contract, it may be determined that the creditor has reason to believe that the illegal subcontractor or illegal subcontractor has the right of agency. If an illegal subcontractor or illegal subcontractor signs a loan contract in the name of the project department of the construction enterprise without the authorization of the construction enterprise, it shall strictly review the basic facts of the loan, including the amount and interest of the loan, and the purpose of the loan, in accordance with the Provisions of the Supreme People's Court on Several Issues Concerning the Application of Law in Private Lending Cases. If there is evidence to prove that the loan was actually incurred and used for the performance of the project or construction contract, the construction enterprise has recognized the act of the project department, it may be determined that the creditor has reason to believe that the illegal subcontractor or illegal subcontractor has the right of agency.

50. Where a construction enterprise establishes a project department and appoints the person in charge of the project department, the person in charge of the project department is entrusted by the construction enterprise to engage in civil acts, which shall be regarded as an act of performing duties, and the construction enterprise shall be the subject of the contract. If the person in charge of the project department established by the construction contractor engages in acts outside the scope of authorization of the construction enterprise, which constitutes an apparent agency, the construction enterprise shall be liable externally. The relevant internal agreement signed between the construction enterprise and the person in charge of the project department established by the construction enterprise stipulates that the clause exempting the construction enterprise from external liability shall not have external effect and shall not be subject to a third party.

51. If the seal of the project department recognized by the construction enterprise is signed to the outside world, the seal shall have the effect of signing or settlement, and the construction enterprise shall be liable for the contract stamped with the seal of the project department. If the construction enterprise does not recognize the seal of the project department, if the right holder provides evidence to prove that the seal has been used in other foreign economic transactions or occasions with publicity effect, the seal shall have the effect of contracting or settlement.

52. If a technical seal, a material receipt seal, or a special data seal generally does not have the effect of contracting or settlement, and the counterparty asserts rights, it shall prove that it has reason to believe that the seal has a function beyond what is recorded on its surface, and the validity of the seal can be determined by adducing evidence in light of the transaction habits and the use of the seal.

53. Where there is an affiliation relationship between the actual constructor and the construction enterprise, and the actor privately engraves the seal of the construction enterprise, and the construction enterprise cannot prove that the counterparty of the contract is aware of the circumstances of the private engraving of the seal, the construction enterprise shall bear the corresponding civil liability.

54. The obligation to pay for the project and the obligation to issue invoices are two obligations of different natures and do not have a reciprocal relationship. Where the employer refuses to pay the project price on the grounds that the contractor has violated the agreement and failed to issue an invoice as a defense, the people's court shall not support it. However, it may be made clear that the contractor has the obligation to issue invoices to the employer. Where a counterclaim is filed by the contractor, the people's court shall support it.

55. These trial guidelines shall be implemented with reference in the work as of the date of issuance.

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