How to understand “actual constructor”( (2)

As to whether the “borrowed qualification” is the scope of the actual constructor, whether the provisions of Article 34 of the interpretation of the Supreme People’s Court on the application of law in the trial of construction contract disputes (1) are applicable, In 2019, the Supreme People’s court gave two cases with different judgments: (1) in the (2019) Supreme People’s court civil ruling No

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6732, the Supreme People’s court held that: “the judicial interpretation of the provisions concerning the employer’s liability to the actual constructor within the scope of the project price owed is a breakthrough in the principle of contract relativity, which should be strictly limited in application

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First of all, the full text of Article 26 of the interpretation of the Supreme People’s Court on the application of law in the trial of disputes over construction contracts of construction projects is as follows: “if the actual constructor brings a lawsuit with the subcontractor or illegal subcontractor as the defendant, the people’s court shall accept it according to law

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If the actual contractor claims rights with the employer as the defendant, the people’s court may add the subcontractor or illegal subcontractor as the party to the case

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The employer shall only be responsible for the actual construction within the scope of the project price owed

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From the perspective of literal interpretation, this clause is directly applicable to the situation that the actual construction contractor claims the rights to the employer in the form of litigation

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However, it can not be directly applied to the case that the actual construction contractor claims the rights to the employer by way of litigation

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Secondly, in the case of affiliated construction, although the actual constructor directly organizes the construction, it is still in the name of the contractor, and the contractor may bear the legal responsibility for the behavior of the actual constructor, that is, the contractor has the legal interest in the performance of the construction contract

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If the employer is allowed to break through the relativity of the contract at will and pay directly to the actual contractor, the rights and interests of the contractor may be damaged

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Therefore, in the absence of justifiable reasons, the employer can not directly pay the project payment to the actual constructor without the consent of the contractor( 2)   In the (2019) Supreme People’s court civil ruling No

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652, the Supreme People’s court held that: “according to the facts that have been found out, Shen Lianghong was actually working under the name of Zhuozhu company, and anda company also recognized Shen Lianghong as the construction subject under the name of Zhuozhu company, so Shen Lianghong was the actual constructor of the project involved in the case《 Article 26 of the interpretation of the Supreme People’s Court on the application of law in the trial of disputes over construction contracts of construction projects stipulates that: “if the actual constructor brings a lawsuit with the subcontractor or illegal subcontractor as the defendant, the people’s court shall accept it according to law

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If the actual contractor claims rights with the employer as the defendant, the people’s court may add the subcontractor or illegal subcontractor as the party to the case

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The employer shall only be liable to the actual constructor within the scope of the project price owed

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” Accordingly, as the actual constructor of the project involved in the case, Shen Lianghong has the right to file a lawsuit against anda company, the employer, in his own name, and anda company shall be responsible for Shen Lianghong within the scope of the project price owed

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Anda company maintains that the actual constructors in the above legal provisions only refer to the constructors who illegally subcontract and illegally subcontract, excluding the actual constructors in the case of affiliation

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This narrow understanding is not in line with the intent of the provisions, and this court will not support it

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” Therefore, whether the “borrowed qualification” is the actual constructor, even if it is identified as the actual constructor, can be applied to the interpretation of the Supreme People’s Court on the application of law in the trial of construction contract disputes, The author thinks that the following situations should be distinguished, which can be divided into the following two situations: (1) if the employer knows that the actual constructor has borrowed the qualification to sign the construction contract, or the employer has malicious collusion with the actual constructor, the actual constructor has the right to ask the employer for the construction funds

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The Supreme People’s court held in the (2019) Supreme People’s court civil ruling No

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6085 that “Yulong company borrowed the qualification of Anhui No

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3 Construction Co., Ltd

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to carry out the actual construction of buildings 1, 4 and 5 contracted by the employer blue sky company in the form of affiliation, which belongs to the actual constructor; At the same time, Yulong company and Lantian company have fulfilled the obligations between the employer and the contractor

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In fact, both parties have formed a construction contract relationship

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Yulong company is the actual contractor of the project involved in the case

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Moreover, from the beginning of signing the contract to the actual performance of the contract, Lantian company knew and recognized the fact that Yulong company borrowed the qualification of Anhui No.3 Construction Co., Ltd

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to carry out the actual construction, and also accepted the deposit directly paid by Yulong company to itself, and paid the project price directly to Yulong company, It further proves that blue sky company has recognized the fact that Yulong company is the actual contractor of the project

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Therefore, the judgment of the first instance held that Yulong company had the right of priority in compensation

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“( 2) The employer does not know about the actual construction contractor’s borrowing qualification, and the actual construction contractor does not have the priority of compensation

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In the (2019) Supreme People’s court civil ruling No

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2852, the Supreme People’s court held that: “for the Yong’an villa project in this case, Xinke company originally signed the” construction contract of construction project “with the successful bidders Longteng company and Dongquan company, but later the parties did not actually perform the contract, Instead, Xinke company and Chen Jinguo signed the “Yong’an mountain villa later project construction contract” (hereinafter referred to as the “construction contract”) and Chen Jinguo actually carried out the construction

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Dongquan company and Longteng company are the construction units in the record form of capacity shortage involved in the case

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Combined with the above facts, it can be concluded that Chen Jinguo was the actual constructor of the project involved

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As a kind of real right, the right of priority to be compensated must be clearly defined by law according to the principle of legal property right in Article 5 of the property law of the people’s Republic of China that “the types and contents of real right shall be prescribed by law”

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However, Article 286 of the contract law of the people’s Republic of China and Article 1 of the reply of the Supreme People’s Court on the priority of compensation for the construction project price clearly define that the subject of the priority of compensation for the construction project price is the contractor of the construction project, not the actual constructor

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This is also in line with the latest legislative spirit that Article 17 of the interpretation of the Supreme People’s Court on the application of law in the trial of disputes over construction contracts of construction projects (2) clearly stipulates that the subject of the priority right to compensation for construction project price is “the contractor who has entered into the construction contract with the employer”

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Chen Jinguo, as the actual constructor, is not the legal subject of the priority right of compensation for the construction project price, and does not enjoy the priority right of compensation for the construction project price

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” 3、 The following two situations are not the actual constructors: (1) the professional technical installation project is not an ordinary labor operation, and the overdue project payment is not a labor cost, so the relevant provisions of the actual constructors cannot be applied

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The Supreme People’s court held in the (2015) MSZ No

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919 civil ruling that: “Hengda Machinery Factory obtained the steel beam manufacturing and installation project through the steel beam manufacturing and installation agreement signed with Chengda Company, and provided the steel beam manufacturing, transportation, installation and other operations according to the contract, and contracted the labor and materials, It can be seen that what it provides is a professional technical installation project, not an ordinary labor operation, and the overdue project payment is not a labor subcontracting fee, which does not meet the applicable conditions specified in the second paragraph of Article 26 of the judicial interpretation of construction engineering

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The steel beam project contracted by Hengda Machinery Plant according to the contract is only part of the construction content in the construction contract between Hongxiang company and Boyuan company, which is an illegal subcontracting project and is not a full performance of the contract between the employer and the contractor

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Therefore, it does not conform to Article 26 of the judicial interpretation of construction projects.

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