2、 Formal bidding has no legal effect.
Article 52 of the contract law of the people’s Republic of China, a contract is invalid under any of the following circumstances: (1) one party enters into a contract by means of fraud or coercion, thereby harming the interests of the state; （2） Maliciously colluding to harm the interests of the state, the collective or a third party; （3） Cover up illegal purposes in legal form; （4） Damage to social and public interests; （5） Violation of mandatory provisions of laws and administrative regulations.
Jinlong Company negotiated with Zhongfu company and determined that Zhongfu company would contract the commercial housing and resettlement housing projects involved.
4、 Both the court of first instance and the Supreme Court held that the parties had entered the site for construction before bidding, and then only conducted formal bidding for handling relevant procedures.
For projects that must be subject to bidding, do not sign contracts before bidding.
However, too detailed agreement shall be avoided as far as possible, otherwise the winning contract may be deemed invalid and cause additional losses.
It is a major project related to social and public interests and public safety.
Although in the actual project contracting process, the employer and the contractor often contact before bidding and may reach a certain agreement.
Article 4 No unit or individual may break a project subject to tender according to law into parts or evade tender in any other way.
Judge’s point of view the focus of dispute in this case is whether the contract will be invalid due to item 3 of Article 1 of the judicial interpretation of construction projects when both parties have carried out formal bidding? The supreme court believes that even if formal bidding is carried out, the contract is still invalid, mainly for the following two reasons: first, bidding is the premise of the effectiveness of the contract of the project that must be bidding.
Article 7 of the provisions on the scope and scale of bidding for engineering construction projects further specifies that bidding must be carried out for the construction of public utility projects with an estimated price of more than 2 million yuan for a single construction contract or a total investment of more than 30 million yuan, although the estimated price of a single construction contract is less than 2 million yuan.
Dehua Jinlong central city project includes resettlement houses with a total construction area of 71793.34 m2, with a total cost of more than 200 million yuan.
The specific scope and scale standards of the projects listed in the preceding paragraph shall be formulated by the development planning department of the State Council in conjunction with relevant departments of the State Council and submitted to the State Council for approval.
Brief introduction I.
If the parties reach an agreement and construct before bidding in form, it is impossible to form an effective contract in order.
Therefore, it belongs to the situation of no bidding.
3、 In May 2015, Jinlong Company informed Zhongfu company to terminate the construction contract on the grounds that Zhongfu company delayed the construction period.
When dealing with any contract dispute, we should first confirm the effectiveness of the contract.
Summary of practical experience 1.
Where laws or the State Council have provisions on the scope of other projects that must be subject to bidding, such provisions shall prevail.
Subsequently, Zhongfu company sued the court and asked the court to confirm that the contract was not terminated.
According to the above laws and regulations, bidding must be carried out..
Article 3 of the bidding law of the people’s Republic of China stipulates that bidding must be conducted for the construction of large-scale infrastructure, public utilities and other projects related to social and public interests and public safety within the territory of the people’s Republic of China.
2、 In September 2013 and April 2014, Jinlong company invited bids for two bid sections of the project involved, and Zhongfu company won the bid.
According to the regulations at that time, the project was a construction project that must be subject to bidding.
If the parties agree to carry out construction first and then carry out formal bidding for the project for which the gist of the judgment must be bidding, the construction contract of the construction project shall be invalid.
If a party carries out formal bidding for the purpose of going through formalities, it violates the purpose of protecting public interests and safety and the principle of openness and fairness in the bidding law.
Only the winning bidder who meets the legal provisions will form a legal construction contract.
Jinlong company filed a counterclaim, claiming that the construction contract was invalid.
For the project that must be bidding, bidding is the premise of signing the construction contract.
Article 3 of the law of the people’s Republic of China on bidding and tendering the following engineering construction projects within the territory of the people’s Republic of China, including survey, design, construction, supervision and procurement of important equipment and materials related to engineering construction, must be subject to bidding: (1) large infrastructure, public utilities and other projects related to social and public interests and public safety; （2） Projects invested or financed by the state in whole or in part; （3） Projects using loans or aid funds from international organizations or foreign governments.
The court ruled that the following is a detailed discussion on how formal bidding affects the effectiveness of the contract in the retrial judgment of the Supreme Court: on the effectiveness of the construction contract of the construction project involved in the case.
Therefore, formal bidding does not belong to effective bidding activities and cannot obtain effective contracts.
Zhongfu entered the construction site in December 2012.
2、 Pay attention to the validity of winning the bid in the process of dispute settlement.
For disputes over construction projects, it is necessary to additionally confirm whether the bid is valid, because the contract with invalid bid will also be invalid.
Both parties agree that the bidding procedure is only for handling relevant certificates for formal bidding.
Article 1 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 in relevant laws and regulations, if the construction contract of construction projects is under any of the following circumstances, it shall be deemed invalid in accordance with item (5) of Article 52 of the contract law: (1) the contractor has not obtained the qualification of construction enterprise or exceeds the qualification level; （2） An unqualified actual constructor borrows the name of a qualified construction enterprise; （3） If a construction project must be subject to bidding but fails to do so or the bid is invalid.
According to Article 1 of the judicial interpretation of construction projects, the contract is invalid.
