The judicial determination of the liability and scope of compensation for the breach of the commercial housing reservation contract by Zhongcheng Qingtai.

Part I Overview of Subscription Disputes over the Sale and Purchase of Commercial Housing

Concept, nature and signing time of 1. commercial housing subscription
The subscription letter for the sale and purchase of commercial housing is a document signed by the parties to the commercial housing presale contract before signing the commercial housing sales contract or the commercial housing existing housing sales contract. It is a preliminary confirmation of the matters related to the transaction of the housing between the two parties.

The nature of the subscription for the sale of commercial housing is an appointment contract and is an independent and valid contract. According to the provisions of Article 5 of the Interpretation of the Commercial Housing Sales Contract, the commercial housing purchase and purchase subscription is defined as a commercial housing sales contract, that is, the name of the reservation is actually the contract, and two conditions should be met: one is to have the ''Commercial Housing Sales Management Meases'' The main content of the commercial housing sales contract stipulated in Article 16; the second is that the seller has collected the purchase price as agreed. However, in practice, if the first condition is met, it can be recognized as a commercial housing sales contract, and there is no need to attach the contract performance conditions for the seller to collect the purchase price.

On the issue of the timing of the signing of the subscription. First of all, the subscription letter does not have to be signed after the developer has obtained the commercial housing presale license; although Article 22 of the "Measures for the Administration of Commercial Housing Sales" stipulates that if the conditions for the sale of commercial housing are not met, the real estate development enterprise shall not sell the commercial housing and shall not purchase the commercial housing. The buyer receives any payment of any nature. However, this provision is only a management measure for the sales behavior of real estate development enterprises by the administrative department, and is not a mandatory provision for determining the validity of the contract. Secondly, the subscription letter should be signed after the developer has obtained the construction permit for the construction project, because after obtaining the construction permit, the developer should have implemented the construction funds, construction unit and construction plan in the procedure, and the project has entered the substantive construction stage, which enhances the certainty of the appointment contract.

Civil Liability of 2. for Violation of Commercial Housing Subscription
In practice, the violation of the commercial housing subscription book leads to the failure to conclude the commercial housing sales contract. There are both the buyer's reasons, such as the reduction of payment ability, the selection of other real estates, etc.; there are also the seller's reasons, the most common one is the profit drive caused by the rise of house prices. In this case, what losses can the buyer claim in addition to requiring the seller to double the deposit?

First of all, the basis of the right of claim in such cases is liability for breach of contract, not liability for contractual negligence.

Secondly, regarding the amount of compensation for losses, for a more comprehensive and specific appointment contract, the seller maliciously breached the contract, such as the price of the house rose, the seller sold the house to a third party in order to obtain the profit of the price increase, thus the buyer's interests could not be realized. In this case, the compensation amount should be determined by referring to the price difference of the house or the profits obtained by the breaching party outside the deposit penalty or direct loss. For example, the provisions of Article 35 of the Civil Trial Guidance of the First Civil Division of the Chongqing Higher People's Court. The specific amount of compensation shall be determined at the discretion of the court, taking into account factors such as the buyer's performance, the seller's degree of fault, reasonable costs and expenses, the difference in the price of the house and the seller's profits. If the buyer asks the seller to compensate the seller for the benefits of performing the contract for the sale of commercial housing, that is, the loss of the total price difference of the house, the court should generally not support it. However, in the case where the seller is induced to resell the house at a high price in violation of the reservation agreement due to the rapid rise of the house price, the seller shall compensate the buyer for the loss of part of the house price difference caused by the purchase of the same house.

Third, as far as the burden of proof is concerned, the contract-keeping party bears the burden of proof for the claim that the actual loss it suffered is significantly higher than the amount of the deposit penalty.

Part II Authoritative Case Guidance
 

typical case]

[Case Name] Dispute over Commercial Housing Appointment Contract between Lu Moumou and Shandong Real Estate Co., Ltd.

[Source] Jinan Intermediate People's Court of Shandong Province

【Trial Court】 Jinan Intermediate People's Court of Shandong Province

[Referee Date] September 10, 2018

referee abstract]

The appellant Lu Moumou and a Shandong Real Estate Co., Ltd. (hereinafter referred to as a real estate company) appealed to the court against the civil judgment of the People's Court of Licheng District, Jinan City due to a dispute over a commercial housing appointment contract. After filing the case on July 26, 2018, the court formed a collegial panel to conduct the trial according to law. The case has now been closed.

Main Abstract]

Appellant (plaintiff in the original trial): Lu Moumou, Han

Appellant (defendant in the original trial): a real estate co., ltd. in Shandong province, with its domicile in Jinan city.

[Summary of the appellant's request]]

Lu Moumou's appeal request: revoke the second and third items of the first-instance judgment, and change the judgment of a real estate company to compensate Lu Moumou for economic losses of 1097265 yuan, and a real estate company to pay Lu Moumou interest of 1653.59 yuan during the period when the purchase price was 100000 yuan.

Facts and reasons: Lu Moumou believes that the court of first instance found that Lu Moumou's loss was calculated incorrectly. The specific reasons are as follows: 1. the price of the real estate involved in the case has not been lower than 18000 yuan/square meter for sale since the transaction price in October 2016, the court of first instance found that the price of the house involved in the case was 14300 yuan/square meter to be wrong. ...... The 2. Court of First Instance, without finding out that the real estate involved in the case had obtained the commercial housing presale license and fulfilled its prior contractual obligations in the Commercial Housing Subscription Agreement, determined that it was wrong for the house involved in the case to be executed at the original unit price of 9718 yuan per square meter, and that it was wrong for Lv Moumou to halve the loss of benefits due to defects in the subscription agreement.... 3. in the first instance, what Lu Moumou claimed in the first instance was the interest loss during the period when a real estate company occupied Lu Moumou's 100000 yuan fund, instead of the available interest loss of the house involved, the court of first instance confused the interest loss with the available interest loss and did not support Lu Moumou's claim, which was a wrong fact finding and the application of law was also wrong, A real estate company shall pay Lu Moumou the interest loss during the occupation of Lu Moumou's 100000 yuan.

A real estate company appeal request: revoke the first and second items of the first instance judgment, and change the judgment to apply the deposit penalty according to law.

Facts and reasons: 1. A real estate company has issued a notice to Lu Moumou on October 27, 2016 to terminate the "Commercial Housing Subscription Agreement", ...... The court of first instance determined that the cancellation time of the subscription agreement was January 20, 2018 without facts and legal basis. 2. After the signing of the "Commercial Housing Subscription Agreement" by both parties, because Lu Moumou did not pay the purchase price in accordance with the subscription agreement ...... A real estate company did not have any breach of contract during the performance of the commercial housing reservation contract, so Lu Moumou claimed that the loss due to a real estate company's breach of contract was claimed, which was inconsistent with the facts. To say the least, the "Commercial Housing Subscription Agreement" signed by both parties has been heard by the Licheng District People's Court of Jinan City as an appointment contract....... Appointment and the liability for breach of contract of this agreement cannot be equated. The subscription agreement only caused Lu Moumou to lose an opportunity to sign this agreement. Lu Moumou did not have any loss of profits and did not affect Lu Moumou's qualification and opportunity to purchase other houses. Therefore, Lu Moumou claimed that there was no legal basis for compensation for losses in accordance with this agreement. According to the provisions of Article 4 of the interpretation of the Supreme People's Court on Several Issues concerning the application of law in the trial of commercial housing sales contract disputes, the case shall be handled in accordance with the provisions of the original agreement on deposit, that is, double return of Lu's deposit. It is obviously incorrect for the court of first instance to judge the loss of the whole house by Lu Moumou's payment of 100,000 yuan.

[Summary of the appellee's reply]]

A real estate company argued that the 1. Lu Moumou asked a real estate company to compensate 1097265 yuan for economic losses, which had no legal basis. Lu's claim for compensation for economic losses is not valid, because he did not pay the total house price, and it is unfair to ask for compensation for losses according to the full house area, which is obviously without basis. Article 6 of the commercial housing subscription agreement signed on May 8, 2016 stipulates that any party who fails to perform the subscription agreement shall be dealt with in accordance with the deposit penalty stipulated by law. The Commercial Housing Subscription Agreement signed by both parties has been judged as a reservation contract by the Licheng District People's Court of Jinan City... The reservation is in the contract stage of signing this contract, which cannot be equated with the liability for breach of contract of this contract. The subscription agreement only causes Lv to lose an opportunity to sign this contract, and Lv has no loss of profits, nor does it affect Lv's qualification and opportunity to buy other houses, therefore, there is no legal basis for Lu to claim compensation for losses in accordance with this agreement. According to the provisions of Article 4 of the interpretation of the Supreme People's Court on Several Issues concerning the application of law in the trial of commercial housing sales contract disputes, the case shall be handled in accordance with the provisions of the original agreement on deposit, that is, double return of Lu's deposit. 2. there is no legal basis for Lu Moumou to require a real estate company to pay the interest of 1653.59 yuan during the period of 100000 yuan for the purchase of the occupied house. The law should not be supported. Lu Moumou's payment of 100000 yuan to us belongs to the house order payment and does not belong to other types of payment. If both parties have disputes over this, they shall deal with it in accordance with the commercial housing subscription agreement, and there is no interest problem. In summary, the request to reject the appeal, in accordance with the "commercial housing subscription agreement" agreed on the provisions of the deposit penalty, that is, double the return of Lu XX deposit.

Lu Moumou argued that a real estate company in 1. believed that the commercial housing subscription agreement was terminated on October 27, 2016, and there was no factual and legal basis. In 2., a real estate company has never called Lu Moumou for the remaining purchase price and inquired about the purchase restriction of Lu Moumou according to the provisions of the commercial housing subscription agreement and the purchase restriction policy of Jinan City in October 2016. At the same time, Lu Moumou submitted to a real estate company the relevant procedures for inquiring about the purchase restriction and handling provident fund loans according to Niu Moumou, consultant of a real estate company. In addition, checking the purchase restriction is a prerequisite for Lu Moumou to pay the remaining purchase price in accordance with the subscription agreement. When a real estate company in 3. sold the house involved in the case to Lu, it did not obtain a commercial housing presale license, and at the same time, it did not show Lu the fact that it did not obtain a license. ...... Lu Moumou in the performance of the commercial housing subscription agreement does not exist in accordance with the contract agreed to pay the supplementary purchase price of 100000 yuan. 4. a real estate company believes that the commercial housing subscription agreement is an appointment contract, not a commercial housing sales contract, it is wrong to think that it should not compensate Lu for the loss of available benefits (I. e. the rising value of the house) in accordance with the provisions of the relevant legal judicial interpretation. Facts and legal basis. The appeal of a real estate company has no factual and legal basis. Please reject the appeal according to law and support Lu Moumou's appeal request.

The court considered]

The court of first instance held that there was 1. question about the time when Lu Moumou and a real estate company terminated the contract. The court of first instance made a civil judgment on December 27, 2017 to reject Lu Moumou's claim, and served it on Lu Moumou and a real estate company on January 4, 2018. Lu Moumou and a real estate company did not file an appeal. Therefore, the time for Lu Moumou and a real estate company to terminate the contract should be the effective date of the civil judgment, that is, January 20, 2018. 2. about the loss of Lu Moumou. In this case, a real estate company has the obligation to sign a commercial housing sales contract with Lu Moumou in accordance with the subscription agreement after reaching the sales conditions. At this time, Lu Moumou may require a real estate company to continue to perform and obtain the subscribed house, but a real estate company refuses to perform, which constitutes a breach of contract. Lu Moumou has the right to require a real estate company to compensate for the loss of appointment breach, I .e. the loss of trust interest in this agreement. The trust interest usually includes the loss of opportunity, in this case, due to a real estate company's breach of contract, so that Lu suffered a trust contract effectively established and lost the opportunity to enter into another favorable contract. With regard to the amount of compensation for the loss, the maximum amount of compensation shall not exceed the trust interest, from the balance of interests and the principle of good faith and fairness, taking into account the performance of the contract-keeping party, the degree of fault of the breaching party, reasonable costs and expenses and other factors to be discretionary. First of all, the price change of the house involved is an important reference factor for determining the loss. Secondly, the degree of performance of the subscription agreement should also be used as an important reference factor in determining the amount of loss of trust interests. Considering the above situation, the court of first instance held that Lu Moumou's loss of trustworthy interest was 292102.5 yuan (584205 yuan × 50%). As for the interest on the house price claimed by Lu Moumou, the court of first instance did not support Lu Moumou's request for a real estate company to pay 90000 yuan of interest on the house price because it has been dealt with in the determination of the loss.

The court of second instance held that ...... Lu Moumou and a real estate company signed a commercial housing subscription agreement, which was a commercial housing reservation contract, and the purpose of the contract was to agree to sign this contract, so the loss caused by the non-performance of the commercial housing subscription agreement in question should be limited to the loss that the contract cannot be signed, and should not be limited to the loss that the contract does not perform. Moreover, when a real estate company clearly refuses to perform the contract, Lu Moumou should also take reasonable measures to prevent his own losses from expanding; if Lu Moumou fails to take appropriate measures to cause the loss to expand, he shall not claim compensation for the expanded loss.... Therefore, the judgment of the first instance is based on the principle of reliance interest, combining the fact that Lv has delayed payment and a real estate company refuses to perform the contract, and comprehensively determines the amount of Lv's loss, which is in line with the actual situation of the case, and the court maintains it. The issue of interest on the house price advocated by Lu Moumou has been dealt with in the determination of the loss, so the court of first instance did not support it, which was not improper, and the court also maintained it.

referee results]

The appeals of Lu Moumou and a real estate company cannot be established and should be rejected. The judgment of the first instance is clear in finding the facts and applying the law correctly and should be upheld. In accordance with the first paragraph of Article 170 of the the People's Republic of China Civil Procedure Law, the judgment is as follows:

The appeal was rejected and the original sentence was upheld.

The third part of the practical operation guide
 

In disputes caused by commercial housing reservation contracts, buyers generally have two kinds of litigation claims, namely, the termination of the "commercial housing subscription agreement" and compensation for the loss of price difference.

If the buyer wants to claim the termination of the contract, the main legal basis is Article 94 of the contract Law. In the case that the developer has made it clear that he will not sign the "commercial housing sales contract" with the buyer, or even sell the commercial housing separately, the buyer's claim can generally be supported.

If the buyer wants to claim compensation for the loss of the house price difference, he must first determine the amount of the price difference. In practice, there are generally the following ways to determine: one is the difference between the price at which the developer separately sells the commercial house involved and the price agreed in the Subscription Agreement; the second is the difference between the price at which the buyer separately purchases the same type of house in the same region and the price agreed in the Subscription Agreement, in addition, when the buyer does not purchase a house separately, the present value of the house involved is generally appraised, and the difference between the appraisal price and the price agreed in the Subscription Agreement is the difference. The appraisal nodes are usually when the buyer receives the cancellation notice from the developer, when the buyer files a lawsuit, when the trial developer agrees to cancel the Subscription Agreement, etc.

Secondly, it is necessary to determine the liability for breach of contract. In practice, it is more common that due to the delay in obtaining the presale permit, the developer cannot sign the "Commercial Housing Sales Contract" with the buyer and accept the buyer according to the time stipulated in the "Subscription Agreement" For the down payment, the sales staff used WeChat, telephone and other tools to inform the buyer to postpone the next link, so that the buyer did not pay the down payment in accordance with the time stipulated in the "Subscription Agreement; when the developer obtained the presale permit a few months later, the house price rose, so the developer deliberately defaulted and sold the house at a high price. In this case, the most important thing is that the buyer should provide evidence to prove the fact that the sales staff inform them to postpone the signing of the "commercial housing sales contract" and pay the down payment. Attention should be paid to the authenticity of the "notification" carrier (such as WeChat) and the relevance with the required facts. For example, if the mobile phone number and the micro signal are the same, the mobile phone number can be charged and the user name of the mobile phone number can be typed. Then use WeChat search, the name of the user of the micro-signal is typed and matched, so that the contents of WeChat communication records are used as strong evidence to determine the developer's breach of contract. In addition, we should also pay attention to avoid identifying the behavior of the sales staff as personal behavior, so as to exempt the developer from the responsibility. We can use the developer's format model to sign the subscription agreement, affix the developer's official seal to the subscription agreement, and put the deposit into the developer's public account.

Third, the extent to which the buyer fulfills the Subscription Agreement is also a factor in defining the amount of compensation for the loss of the difference. In practice, the amount of deposit stipulated in the "Subscription Agreement" is generally very small, and buyers can pay in full on the day of signing the "Subscription Agreement"; but compared to the entire purchase price, the amount of the deposit is insignificant. From this point of view, in terms of the payment obligations that buyers should perform in the entire process of commercial housing sales, although buyers have paid all the deposits in full accordance with the "Subscription Agreement", the degree of performance is still very low. From a fair point of view, the court generally will not judge the developer to pay the full price difference compensation to the buyer.

Similar cases, in addition to the typical cases highlighted above, there are also (2016) Lu 06 min zong 1004 [similar cases (2016) Lu 06 min zong 1005, (2016) Lu 06 min zong 1006, (2016) Lu 06 min zong 1514, (2016) Lu 06 min zong 1515, (2016) Lu 06 min zong 1516], (2017) Jing 03 min zong 10326, (2017) Zhejiang 05 min final 967 [similar cases (2017) Zhejiang 0523 Minchu 4121), (2017) Zhejiang 0523 Minchu 4122], (2017) Su 0404 Minchu 5834 [similar cases (2017) Su 0404 Minchu 5832], (2017) Su 04 Minchu 3596, (2017) Su 02 Minchu 4789, wait.

Part IV Integration of Laws and Regulations
 

1. the People's Republic of China Contract Law

Article 6 The parties concerned shall abide by the principle of good faith in exercising their rights and performing their obligations.

Article 8 A lawfully formed contract shall be legally binding on the parties. The parties shall perform their obligations in accordance with the agreement and may not modify or terminate the contract without authorization.

A lawfully established contract shall be protected by law.

Article 93 If the parties reach a consensus through consultation, the contract may be terminated.

The parties may agree on the conditions for the termination of the contract by one party. When the conditions for the termination of the contract are fulfilled, the person with the right to terminate the contract may terminate the contract.

Article 94 A party may rescind a contract under any of the following circumstances:

The (I) is unable to achieve the purpose of the contract due to force majeure;

(II) prior to the expiration of the performance period, one of the parties expressly expresses or indicates by its own conduct that it will not perform its main obligation;

(III) one of the parties delays in performance of the main obligation and fails to perform within a reasonable period of time after being urged to do so;

(IV) one of the parties delays the performance of its obligations or has other breach of contract, resulting in the failure to achieve the purpose of the contract;

(V) other circumstances prescribed by law.

Article 96 If a party claims to rescind a contract in accordance with the provisions of paragraph 2 of Article 93 and Article 94 of this Law, it shall notify the other party. The contract shall be terminated when the notice reaches the other party. If the other party disagrees, it may request the people's court or an arbitration institution to confirm the validity of the termination of the contract.

Where laws and administrative regulations stipulate that the termination of a contract shall be subject to approval, registration and other formalities, such provisions shall be followed.

Article 97 After the termination of the contract, if the performance has not yet been performed, the performance shall be terminated; if the performance has already been performed, the parties may, in accordance with the performance and the nature of the contract, demand restitution, take other remedial measures and have the right to claim compensation for losses.

Article 113 If one of the parties fails to perform its contractual obligations or performs its contractual obligations not in accordance with the agreement, thus causing losses to the other party, the amount of compensation for losses shall be equivalent to the losses caused by the breach, including the benefits that can be obtained after the performance of the contract, but shall not exceed the losses that the breaching party foresaw or should have foreseen at the time of the conclusion of the contract. Business operators who commit fraud in providing goods or services to consumers shall be liable for damages in accordance with the provisions of the the People's Republic of China Law on the Protection of the Rights and Interests of Consumers.

Article 119 After one of the parties breaches the contract, the other party shall take appropriate measures to prevent the expansion of the loss; if the loss is expanded due to the failure to take appropriate measures, it shall not claim compensation for the expanded loss. The reasonable expenses incurred by the parties to prevent the expansion of losses shall be borne by the breaching party.

2. Measures for the Administration of Commercial Housing Sales

Article 16

When selling commercial housing, the real estate development enterprise and the buyer shall conclude a written contract for the sale of commercial housing.

The contract for the sale of commercial housing shall specify the following main contents:

(I) the names or names and domiciles of the parties;

Basic conditions of (II) commercial housing;

(III) the sale of commercial housing;

The method of determining the price of the (IV) commodity house and the total price, payment method and payment time;

Conditions and date of (V) delivery;

(VI) decoration and equipment standard commitment;

(VII) the delivery commitment and related rights and responsibilities of supporting infrastructure and public facilities such as water supply, power supply, heat supply, gas, communication, roads, greening, etc;

(VIII) the ownership of public supporting buildings;

How to deal with the difference of (IX) area;

(X) handle matters relating to the registration of property rights;

(11) methods of dispute resolution;

(12) liability for breach of contract;

(13) Other matters agreed upon by both parties.

3. Interpretation of the Supreme People's Court on Several Issues concerning the Application of Law in the Trial of Disputes over Commercial Housing Sales Contracts

Article 4 Where the seller receives a deposit from the buyer through subscription, order, reservation, etc. as a guarantee for the conclusion of a commercial housing sales contract, if the commercial housing sales contract cannot be concluded due to one of the parties, it shall be dealt with in accordance with the provisions of the law on the deposit; due to reasons that cannot be attributed to both parties, the seller shall return the deposit to the buyer.

Article 5 Where the agreement on subscription, order and reservation of commercial housing has the main contents of the contract for the sale and purchase of commercial housing as stipulated in Article 16 of the Measures for the Administration of the Sale of Commercial Housing, and the seller has received the purchase price in accordance with the agreement, the agreement shall be recognized as a contract for the sale and purchase of commercial housing.

4. Interpretation of the Supreme People's Court on the Application of Law in the Trial of Cases of Disputes over Sales Contracts

Article 2 If a party signs an appointment contract such as a subscription letter, an order letter, a reservation letter, a letter of intent, a memorandum, etc., and agrees to conclude a sales contract within a certain period of time in the future, and one party fails to perform its obligation to conclude a sales contract, the other party requests it to bear the responsibility for breach of the appointment contract or request If the appointment contract is terminated and damages are claimed, the people's court shall support it.

5. Interpretation of the Supreme People's Court on Several Issues concerning the Application of the the People's Republic of China Guarantee Law

Article 115 Where the parties agree to use the delivery of the deposit as security for the conclusion of the main contract, if the party paying the deposit refuses to conclude the main contract, it shall not have the right to demand the return of the deposit; if the party receiving the deposit refuses to conclude the contract, it shall return double the deposit.

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