Interpretation of the Supreme People’s Court on the application of law in the trial of construction contract disputes (1) (adopted at the 1825th meeting of the judicial committee of the Supreme People’s Court on December 25, 2020, and implemented as of January 1, 2021) In order to correctly hear the construction contract disputes, protect the legitimate rights and interests of the parties, maintain the order of the construction market, and promote the healthy development of the construction market, according to the civil code of the people’s Republic of China, the construction law of the people’s Republic of China, the bidding law of the people’s Republic of China, the Civil Procedure Law of the people’s Republic of China and other relevant laws and regulations, Combined with the trial practice, this interpretation is formulated
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Article 1 a construction contract for a construction project shall be deemed invalid in accordance with the provisions of the first paragraph of Article 153 of the civil code under any of the following circumstances: (1) the Contractor fails to obtain the qualification of a construction enterprise or exceeds the qualification level; (2) the unqualified actual constructor borrows the name of a qualified construction enterprise; (3) a construction project must be tendered, but it is invalid if it is not tendered or if it wins the bid
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A construction contract signed by a contractor with others for subcontracting or illegally subcontracting construction projects shall be deemed invalid in accordance with the provisions of Article 153 (1) and article 791 (2) and (3) of the civil code
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Article 2 if the scope of the project, construction period, project quality, project price and other substantive contents stipulated in the construction contract of the construction project signed separately by the bid inviting party and the bid winning party are inconsistent with the bid winning contract, and one party requests to determine the rights and obligations in accordance with the bid winning contract, the people’s court shall support it
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In addition to the winning contract, the bid inviting party and the bid winning party sign a separate contract to reduce the project price in disguised form, such as purchasing the contracted real estate at a price significantly higher than the market price, building supporting facilities for free, transferring profits and donating property to the construction unit
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If one party requests to confirm that the contract is invalid on the ground that it deviates from the substantive content of the winning contract, the people’s court shall support it
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Article 3 the people’s court shall support the party’s request to confirm the invalidity of the construction contract of the construction project on the ground that the employer has not obtained the planning approval procedures such as the planning license of the construction project, unless the employer obtains the planning approval procedures such as the planning license of the construction project before bringing a lawsuit
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If the employer is able to go through the examination and approval procedures but fails to do so, and requests to confirm the invalidity of the construction contract of the construction project on the ground of not going through the examination and approval procedures, the people’s court will not support it
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Article 4 if a contractor signs a construction contract beyond the business scope permitted by the qualification level and obtains the corresponding qualification level before the completion of the construction project, and the party concerned requests to be treated as an invalid contract, the people’s court will not support it
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Article 5 the people’s court shall not support the labor subcontract signed between the contractor with legal qualification for labor operation and the general contractor or subcontractor if the party concerned requests to confirm it invalid
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Article 6 if a construction contract for a construction project is invalid and one party claims compensation from the other party, it shall bear the burden of proof for the fault of the other party, the size of the loss, and the causal relationship between the fault and the loss
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If the amount of loss cannot be determined, and one party requests to determine the amount of loss by reference to the quality standard, construction period, payment time of project price, etc
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as agreed in the contract, the people’s court may make a judgment based on the degree of fault of both parties, the causal relationship between fault and loss, etc
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Article 7 If an unqualified unit or individual signs a construction contract in the name of a qualified construction enterprise, and the employer requests the borrower and the borrower to bear joint and several liability for the losses caused by the unqualified quality of the construction project, the people’s court shall support it
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Article 8 if the parties dispute the commencement date of a construction project, the people’s court shall determine it in accordance with the following circumstances: (1) the commencement date is the commencement date specified in the commencement notice issued by the employer or the supervisor; If the conditions for commencement are not met after the notice for commencement is issued, the time when the conditions for commencement are met shall be the commencement date; If the commencement date is delayed due to the Contractor’s reasons, the time specified in the commencement notice shall be the commencement date
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(2) if the contractor has actually entered the site for construction with the consent of the employer, the actual construction time shall be taken as the commencement date
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(3) if the employer or the supervisor fails to issue the notice of commencement and there is no relevant evidence to prove the actual commencement date, the commencement date shall be determined by comprehensively considering the time specified in the commencement report, the contract, the construction license, the completion acceptance report or the completion acceptance record form, and combining with the fact whether the commencement conditions are met
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Article 9 if the parties dispute the actual completion date of a construction project, the people’s court shall determine it in accordance with the following circumstances: (1) if a construction project has passed the completion acceptance, the date of passing the completion acceptance shall be regarded as the date of completion; (2) if the contractor has submitted the completion acceptance report and the employer delays the acceptance, the date when the Contractor submits the acceptance report shall be regarded as the completion date; (3) if the construction project is used by the employer without authorization without completion acceptance, the date of transfer of possession of the construction project shall be regarded as the completion date
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Article 10 the extension of the construction period agreed by the parties shall be confirmed by the employer or the supervisor’s visa
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Although the contractor has not obtained the confirmation of the extension of the construction period, it can prove that it has applied to the employer or the supervisor for the extension of the construction period within the time limit agreed in the contract and the reasons for the extension are in line with the contract
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If the contractor claims the extension of the construction period on this ground, the people’s court shall support it
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If the parties agree that the Contractor fails to apply for extension of the construction period within the agreed time limit, it shall be deemed that the construction period is not extended, and it shall be dealt with in accordance with the agreement, except that the employer agrees to extend the construction period after the agreed time limit or the contractor proposes a reasonable defense
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Article 11 before the completion of a construction project, if the parties dispute the quality of the project and the quality of the project has passed the appraisal, the appraisal period shall be the extended period
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Article 12 If the quality of a construction project is not in conformity with the contract due to the reasons of the contractor, the contractor refuses to repair, rework or reconstruct, and the employer requests to reduce the project price, the people’s court shall support it
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Article 13 a contract letting party shall be liable for its fault in one of the following circumstances, which causes the quality defects of a construction project: (1) the design provided is defective; (2) the building materials, building components, fittings and equipment provided or designated to be purchased do not meet the mandatory standards; (3) directly appoint subcontractors to subcontract professional projects
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If the contractor is at fault, he shall also bear corresponding fault liability
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Article 14 the people’s court shall not support a construction project that has not been completed and accepted, and after the employer uses it without authorization, he claims the right on the ground that the quality of the part used does not conform to the agreement; However, the Contractor shall bear civil liability for the quality of the foundation project and the main structure within the reasonable service life of the construction project
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Article 15 in case of a dispute over the quality of a construction project, the developer may file a lawsuit with the general contractor, the subcontractor and the actual construction as co defendants
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Article 16 in a case of dispute over a construction project contract brought by a contractor, if the developer files a counterclaim against the contractor for paying liquidated damages or compensating reasonable expenses for repair, rework or reconstruction on the ground that the quality of the construction project does not conform to the contract or the provisions of the law, the people’s court may try the case jointly.
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