However, if the bankrupt contractor cannot claim, the actual constructor cannot claim, and the right of price priority is dead in name.
Key words: the actual constructor system Bankruptcy law governs penetrating thinking The actual constructor of the construction project bankruptcy system was initiated by the Interpretation of the Supreme People’s Court on the Applicable Law in the Trial of Construction Contract Disputes Cases of Construction Projects (Fa Shi [2004] No.
There is inevitably a hard wound of “a headache, a pain in the head, a pain in the foot”, which leads to “collisions” of the system from time to time, especially after the contractor, as a subcontractor or illegal subcontractor, enters the bankruptcy proceedings, The resulting series of procedural and substantive issues deserve special attention.
The actual constructor directly claims the project funds from the employer, which is equivalent to bypassing the bankrupt contractor.
However, this is just an abstract and slogan like paradigm for the justification of the system.
However, in the final analysis, under the legal logic system of civil law, it is a fundamental move to straighten out the legal context of the actual construction personnel system.
In short, protecting the legitimate rights and interests of migrant workers is the only legitimate reason for the actual construction personnel system.
There is no doubt that the actual constructor system is a distinctive and creative system in the field of construction projects.
First, the issue of jurisdiction, that is, how to choose between exclusive jurisdiction over real estate and centralized jurisdiction over bankruptcy.
The root of the conflict lies in the differences between the two systems and the conflicts of the values behind the systems.
The construction project contract is subject to the exclusive jurisdiction of real estate, and the bankruptcy law also provides for the centralized jurisdiction of the court accepting the bankruptcy application.
The starting point is to solve the social problem of arrears of migrant workers’ wages, which is not based on legal logic and institutional rationality.
In fact, the actual constructor system cannot achieve the goal of the system makers, because migrant workers are not equal to the actual constructors, and their wages are not equal to the project funds of the actual constructors.
After the promulgation and implementation of the Civil Code, the actual constructor system is still fully accepted by the Interpretation of the Supreme People’s Court on the Application of Law in the Trial of Construction Contract Disputes (I) (Fa Shi [2020] No.
What’s more, the actual constructors are an uncertain concept.
The judicial interpretation derived the procedural and substantive rules for the actual constructor to claim the project payment responsibility from the employer, forming the actual constructor system.
On the one hand, it reduces the bankruptcy property, on the other hand, it obtains biased repayment, which is in sharp conflict with the concept of collective fair repayment in the bankruptcy law, It has become a thorny problem whether the project funds are “put into storage” or directly attributed to the actual constructors.
The value conflicts are embodied in the conflicts between substantive law and procedural law, inclined protection and equal protection, substantive justice and formal justice.
Click to read: [December 17-18 live video class] Seminar on the key issues in the revision of the Enterprise Bankruptcy Law and the ways to revitalize the distressed real estate on the conflict resolution between the actual constructor system and the bankruptcy law – from the perspective of optimizing the operation of the actual constructor system when the contractor goes bankrupt, the actual constructor and the contractor have conflicts over the determination of the competent court, the final ownership of the project funds, and the exercise of the priority right to payment when the contractor goes bankrupt.
Author: Yu Wei: Doctor of Law, Deputy Dean of Shaoxing Dagong Law Research Institute, Deputy Director of Zhejiang Lawyers Association Construction Engineering Special Committee; Zeng Xiaoyuan: Master of Law, Deputy Director of Engineering Law Research Center of Shaoxing Dagong Law Research Institute.
The second is the ownership of the project funds, that is, how to balance the individual repayment of the actual constructor with the collective repayment of the bankrupt contractor.
Once the contractor enters bankruptcy, if the project funds belong to the bankrupt contractor, they should be included in the bankruptcy property, and then distributed among the bankruptcy creditors.
25, hereinafter referred to as the Judicial Interpretation I of New Construction Projects).
It is a product of pragmatism.
To reconcile the value conflicts between systems and optimize the operation of the actual constructor system in the contractor’s bankruptcy proceedings, we should establish the legal rules governing the priority application of the bankruptcy law in the procedure, establish the penetrating thinking that the contractor’s management fee belongs to the bankruptcy property in the entity, and fundamentally establish the institutional framework of the construction project bankruptcy system.
When the two competent courts are inconsistent, the question of which court will have jurisdiction inevitably arises.
The starting point of the system of price priority is to solve the problem of project payment in arrears and protect the interests of construction workers.
The system of actual constructors is not so much a legal system as a legal policy, because it has no place in the traditional civil law theory and provisions, but only in the judicial interpretation.
When the contractor goes bankrupt, the legal application problem is particularly prominent.
1、 Issue raised//The actual constructor system is actually a “patch” on the construction project contract, which cannot be integrated into the logic system of civil law.
Therefore, it is necessary to transcend the problem itself and thinking barriers, and to think abstractly about the positioning of the actual constructor system and the bankruptcy system and the value conflict behind them.
There is still a gap between the actual constructors’ access to the project funds and the migrant workers’ wages.
At best, the actual construction personnel system is only an indirect and reflective protection of the legitimate rights and interests of migrant workers..
If the bankrupt contractor claims, the money obtained to realize the right of price priority can only be paid by the bankrupt creditors collectively, and cannot be “precise droppers” for construction workers, which is contrary to the legislative purpose.
2、 Abstract thinking about the system positioning and value conflict, such as discussing problems and systems, will inevitably fall into the logical trap of circular argument, and will inevitably draw conclusions based on experience and emotional likes and dislikes.
Third, how to exercise the right of price priority.
14).
However, the actual constructor system is, after all, an expedient measure to solve the problem of arrears of migrant workers’ wages in a specific period and under a specific background.
When the contractor goes bankrupt, the priority of payment is subject to the dual rigid constraints of the bankruptcy law and the actual constructor system, and how to realize its system function needs to be considered particularly.
