Perspective | Legal "Secrets" in the Process of Decorating Commercial Housing

In the decoration process, choosing a suitable decoration company and signing a fair and reasonable contract is an important prerequisite for protecting homeowners' rights. However, in practice, there are often many legal risks. Below is a specific legal case, and we will analyze the relevant legal provisions in conjunction with this case and point out ways to avoid risks.
 

Ms. Li chose a small decoration company through a friend's introduction to decorate her new house. Trusting her friend's recommendation, Ms. Li did not carefully verify the decoration company's qualifications and reputation, and hurriedly signed the decoration contract, paying most of the project funds. However, halfway through the decoration, the decoration company suddenly disappeared and could not be contacted. Ms. Li's decoration project was forced to stop, causing not only economic losses but also affecting her move-in plans.

Legal provisions:

Article 577 of the Civil Code: "If one party fails to perform its contractual obligations or performs them in a manner that does not conform to the agreement, it shall bear the liability for breach of contract, including continuing to perform, taking remedial measures, or compensating for losses."

Article 43 of the Consumer Rights Protection Law: "Consumers who purchase goods or receive services at exhibitions or rental counters and whose legitimate rights and interests are harmed may request compensation from the seller or service provider. After the exhibition ends or the rental period expires, they may also request compensation from the organizer of the exhibition or the lessor of the counter. The organizer of the exhibition or the lessor of the counter has the right to seek compensation from the seller or service provider after compensating."

Analysis:

In this case, the decoration company failed to complete the decoration project as agreed in the contract and suddenly disappeared, constituting a serious breach of contract. Ms. Li has the right to request the decoration company to bear the liability for breach of contract, including compensation for losses, according to the relevant provisions of the Civil Code. However, since the decoration company has "run away," Ms. Li may face difficulties in protecting her rights. At this time, if Ms. Li can prove that the decoration company engaged in fraudulent behavior or willful breach of contract, she may also consider filing a complaint with the relevant regulatory authorities or seeking legal assistance.

Ways to avoid risks:

1. Verify the decoration company's qualifications: When choosing a decoration company, homeowners should carefully verify its business license, construction qualifications, and other qualification documents to ensure it has the qualifications for legal operation and corresponding construction capabilities.

2. Understand the decoration company's reputation: Use online searches, customer reviews, and other channels to understand the decoration company's reputation and historical performance, and choose a reputable decoration company for cooperation.

3. Sign a formal contract: When signing a contract with the decoration company, be sure to use a formal contract template and review the contract terms item by item. Pay special attention to key clauses such as project scope, quality standards, construction period, payment methods, and breach of contract liability to ensure that the contract content is clear, legal, and reasonable.

4. Control the payment schedule: When paying project funds, it is recommended that homeowners adopt a phased payment method based on project progress and quality. Avoid paying a large portion or all of the project funds at once to reduce the risk of breach of contract by the decoration company.

In the decoration process, the design plan and material selection are two crucial aspects. They not only concern the decoration effect but also involve legal issues such as intellectual property protection and material quality. However, the professional language in design is often obscure, the names of materials are complex and difficult to clarify, and the professional nature of legal provisions related to intellectual property presents a high threshold for consumers. We will analyze the relevant legal provisions in conjunction with the following case to examine the legal risks present in this stage.
 

Mr. Zhang commissioned a decoration company to design his villa. The decoration company provided a design plan that Mr. Zhang was very satisfied with and paid the design fee. However, during the decoration process, Mr. Zhang found that the design plan was highly similar to a work by a well-known designer, with some details being identical. Mr. Zhang realized that there might be an issue of design plan infringement and negotiated with the decoration company.

Legal provisions:

Article 52 of the Copyright Law: "Those who engage in the following infringing acts shall bear civil liability according to the circumstances, including stopping the infringement, eliminating the impact, apologizing, and compensating for losses: ... (5) Plagiarizing others' works; ..."

Analysis:

In this case, if the decoration company cannot prove that its design plan is original and does not infringe on others' copyrights, its actions will constitute plagiarism of others' works, and it will need to bear corresponding civil liability. Mr. Zhang has the right to request the decoration company to stop further infringement on the copyright holder, eliminate the impact, reissue an independently designed plan, and compensate for the losses caused.

Ways to avoid risks:

1. Review the source of the design plan: Before accepting the design plan, homeowners should require the decoration company to provide proof of the legal source of the design plan, such as the designer's authorization letter or original statement, to ensure that the design plan does not infringe on others' intellectual property.

2. Sign an intellectual property agreement: Clearly stipulate the ownership and usage rights of the design plan's intellectual property in the contract to avoid disputes arising from unclear ownership.

3. Choose well-known designers or design companies: To reduce the risk of design plan infringement, homeowners can choose to cooperate with well-known designers or reputable design companies. These professional institutions usually pay more attention to intellectual property protection and originality of works.

Ms. Wang agreed with the decoration company to use a certain brand of high-end environmentally friendly materials during the decoration process. However, during construction, Ms. Wang found that the materials actually used by the decoration company were not the brand specified in the contract and were clearly substandard. These materials not only affected the decoration effect but also potentially polluted the living environment. Ms. Wang was very dissatisfied with this and requested the decoration company to replace the qualified materials and compensate for the losses.

Legal provisions:

Article 577 of the Civil Code: "If one party fails to perform its contractual obligations or performs them in a manner that does not conform to the agreement, it shall bear the liability for breach of contract, including continuing to perform, taking remedial measures, or compensating for losses."

Article 16 of the Consumer Rights Protection Law: "Operators providing goods or services to consumers shall perform their obligations in accordance with this law and other relevant laws and regulations. If there are agreements between operators and consumers, they shall perform their obligations according to the agreements, but the agreements shall not violate the provisions of laws and regulations."

Article 40 of the Product Quality Law: "If the sold product has any of the following circumstances, the seller shall be responsible for repair, replacement, or return; if it causes losses to the consumer who purchased the product, the seller shall compensate for the losses: ... (2) does not meet the product standards indicated on the product or its packaging; ..."

Analysis:

In this case, the decoration company did not provide qualified materials as stipulated in the contract, constituting a breach of contract. Ms. Wang has the right to request the decoration company to replace the qualified materials and compensate for the losses caused.

Ways to avoid risks:

1. Specify material brands and standards: Clearly stipulate key information such as the brand, specifications, model, and quality standards of the materials in the contract to ensure that the decoration company provides qualified materials as agreed.

2. Request material qualification certificates: When materials arrive on site, the owner should require the decoration company to provide qualification certificates and inspection reports for the materials to verify their authenticity and quality.

3. Choose reputable suppliers: Owners can recommend or designate reputable material suppliers to the decoration company to ensure the quality of materials and the stability of supply.

During the decoration process, construction quality and safety management are crucial links that directly relate to the smooth progress of the decoration project and the quality of the final results. Below is a specific legal case, which we will analyze in conjunction with the relevant legal provisions and point out ways to mitigate risks.
 

Mr. Li's home is undergoing interior decoration, involving water and electricity renovation and wall painting. During the construction process, due to improper operation by the decoration company's workers, the electrical wiring did not comply with safety standards, posing a short-circuit risk. One day, a fire suddenly broke out in Mr. Li's home, causing severe damage to the house, fortunately without casualties. An investigation revealed that the cause of the fire was a short circuit in the electrical wiring. Mr. Li subsequently sued the decoration company for compensation.

Legal provisions:

Article 1192 of the Civil Code: "If a labor relationship is formed between individuals, the party providing the labor shall bear tort liability for damages caused to others due to the labor. The party receiving the labor shall bear tort liability and may seek compensation from the party providing the labor if there is intent or gross negligence."

Article 29 of the Construction Engineering Quality Management Regulations: "The construction unit must inspect building materials, building components, equipment, and ready-mixed concrete according to engineering design requirements, construction technical standards, and contract agreements. The inspection must have written records and be signed by a designated person; materials that have not been inspected or do not pass inspection shall not be used."

Analysis:

In this case, the decoration company's workers caused the electrical wiring to not comply with safety standards due to improper operation, leading to a fire accident that severely damaged Mr. Li's house. According to the relevant provisions of the Civil Code, the decoration company, as the party receiving the labor, must bear tort liability and compensate Mr. Li for his losses. At the same time, the Construction Engineering Quality Management Regulations also clarify the responsibility of the construction unit for material inspection to ensure that construction quality meets requirements.

Ways to avoid risks:

1. Choose a qualified decoration company: When selecting a decoration company, the owner should check its business license, construction qualifications, and other documents to ensure it has the qualifications for legal operation and corresponding construction capabilities.

2. Strengthen supervision at the construction site: Owners can hire third-party supervision agencies or arrange personnel to supervise the construction site to ensure that construction quality and safety meet regulatory requirements.

3. Clarify contract terms: Clearly stipulate key terms such as construction quality standards and safety requirements in the contract to have a basis for reference in case of disputes.

4. Regular inspections and acceptance: During and after construction, owners should regularly conduct quality inspections and acceptance work to ensure that construction quality and safety meet the contract agreements and relevant standards.

When seeking decoration experience, it is evident that there is a common occurrence of exceeding the budget during the decoration process, with various reasons for the budget overruns. On one hand, the complexity and uncertainty of decoration projects make it difficult to fully foresee many potential problems and changes at the time of contract signing. On the other hand, some decoration companies may deliberately lower prices when quoting to secure contracts, but then increase costs during construction for various reasons. Additionally, the owner's lack of understanding of the decoration project, unfamiliarity with material prices, and poor communication may also lead to budget overruns, as illustrated by the following specific case.
 

Ms. Liu signed a residential decoration construction contract with a decoration company for her new house, clearly stipulating the contract price and limitations on project changes. However, during the construction process, the decoration company unilaterally proposed to add engineering projects and significantly increase the decoration price without Ms. Liu's consent, citing deviations between actual construction and design. After Ms. Liu refused to pay for the additional items, the decoration company immediately stopped work, leaving Ms. Liu in a dilemma of either facing a halted construction process or a significantly increased budget. After multiple unsuccessful communications with the decoration company, Ms. Liu subsequently sued the decoration company in court, requesting to terminate the contract, return the payment for unfinished work, and compensate for her losses. The court supported Ms. Liu's claims after hearing the case.

Legal provisions:

Article 543 of the Civil Code: "The parties may change the contract by mutual agreement."

Article 563 of the Civil Code: "In any of the following circumstances, the parties may terminate the contract: ... (2) Before the performance period expires, one party clearly expresses or indicates by its actions that it will not perform the main obligations; ..."

Article 566 of the Civil Code: "After the contract is terminated, the unperformed part shall cease to be performed; for the performed part, based on the performance situation and the nature of the contract, the parties may request restoration to the original state or take other remedial measures, and have the right to request compensation for losses."

Analysis:

As ordinary consumer owners, when choosing a decoration company, they often rely on trust in its professionalism and recognition of the design drawings and quotes provided. They expect to achieve the expected decoration results according to the contract. However, in the decoration market, some decoration companies often adopt low-budget strategies to attract customers and facilitate contract signing. However, during the actual construction process, these companies frequently unilaterally add procedures and materials, forcing owners to face high "additional item fees." When owners refuse these unreasonable additional items, decoration companies may resort to extreme measures such as work stoppage to coerce owners into accepting these additions, which seriously infringes on the legitimate rights and interests of the owners.

The decoration company's actions of stopping work and other breaches of contract lead to the termination of the contract. According to the relevant provisions of the Civil Code, it must bear corresponding breach of contract liability and compensate for the losses caused to the owner due to the work stoppage. These losses may include, but are not limited to, losses due to delayed occupancy, rental losses, additional living expenses, etc.

Therefore, for renovation companies, adhering to the principles of honesty and credit, and following the contractual agreements is not only a legal obligation but also key to maintaining the industry's reputation and gaining customer trust. For homeowners, when signing a renovation contract, they should carefully review the contract terms to ensure their rights are fully protected. At the same time, during the contract execution process, they should remain vigilant, take necessary measures to minimize their losses, and pay attention to preserving evidence in case of anticipated breaches to timely protect their legal rights.

From a legal perspective, the project acceptance and cost settlement phase during the renovation process is a major obligation for homeowners and an important part of ensuring the performance of the renovation contract. This phase often carries a series of legal risks due to hasty conclusions by homeowners. To more specifically reflect these risks and provide corresponding legal citations and avoidance methods, we will continue to cite typical legal cases.
 

Ms. Li signed a renovation contract with a well-known renovation company, which detailed the renovation projects, quality standards, acceptance procedures, and settlement methods. After the renovation project was completed, Ms. Li found quality issues with some projects, such as unreasonable circuit layout and water pipe leakage. She immediately requested the renovation company to rectify the issues, but the company refused, claiming the project had passed acceptance, and demanded Ms. Li pay the full remaining amount. A dispute arose between the two parties, which ultimately went to court.

During the court proceedings, based on legal provisions and relevant agreements in the contract, the court determined that the renovation company had quality issues during construction and had not followed the acceptance procedures stipulated in the contract. Therefore, the court ruled that the renovation company must rectify the identified issues and re-conduct acceptance after the rectification is completed. The court also pointed out that Ms. Li had the right to refuse to pay the remaining project payment until she had accepted and confirmed the rectified project as qualified.

Legal provisions:

Article 16 of the "Regulations on the Quality Management of Construction Projects": "After the construction unit receives the completion report of the construction project, it shall organize relevant units such as design, construction, and engineering supervision to conduct completion acceptance. The completion acceptance of the construction project shall meet the following conditions: ... (4) There are complete technical archives and construction management materials; ... The construction project can only be put into use after passing acceptance."

Article 30 of the "Regulations on the Management of Residential Interior Decoration and Renovation" (Shandong Province): "After the completion of the residential interior decoration project, the decorator shall conduct acceptance according to the engineering design contract and corresponding quality standards. After passing acceptance, the decoration company shall issue a quality warranty for the residential interior decoration."

Article 509 of the "Civil Code": "Parties shall fully perform their obligations as agreed. Parties shall follow the principle of good faith and perform obligations such as notification, assistance, and confidentiality according to the nature, purpose, and trading habits of the contract."

Ways to avoid risks:

1. Clarify Acceptance Standards and Procedures: As a homeowner, you should try to detail the acceptance standards, procedures, timelines, and personnel involved in the acceptance in the contract to ensure transparency and fairness in the acceptance process.

2. Stage Acceptance and Payment: Divide the renovation project into multiple stages for acceptance and payment, paying the corresponding amount only after each stage passes acceptance. This allows for timely rectification when issues are discovered, preventing further losses.

3. Preserve Evidence: Keep relevant evidence throughout the renovation process, such as contracts, construction drawings, acceptance records, and communication records. This evidence is crucial for proving your case in the event of a dispute.

4. Seek Professional Help: If there are doubts or disputes during the acceptance process, seek assistance from third-party professional organizations (such as supervision companies, quality inspection agencies, etc.) for objective and fair evaluation and appraisal.

5. Timely Rights Protection: Once you discover that the renovation company has breached the contract or there are quality issues, communicate and negotiate with the renovation company promptly. If negotiations fail, you can legally file a complaint with the relevant authorities or initiate litigation to protect your rights.

After the renovation work is completed, the service content of the decoration is not entirely finished. Many defects during the renovation process require time to verify, and within a reasonable time frame, the renovation company should still bear warranty responsibilities for the quality of the renovation. Homeowners often find that renovation companies refuse to bear warranty responsibilities, citing reasons such as "non-quality issues". The following case can help us think about how to protect homeowners' after-sales rights regarding renovation matters.
 

Ms. Liu signed a home renovation contract with a renovation company, which clearly stipulated the warranty period and responsibilities for the renovation project. Shortly after the renovation was completed, Ms. Liu discovered water seepage on the bedroom wall, leading to mold growth. She immediately contacted the renovation company, but the company refused to bear warranty responsibilities, claiming that "the wall seepage may be caused by external factors, not a quality issue of the renovation." Left with no choice, Ms. Liu decided to seek legal means to protect her rights.

Legal provisions:

Article 23 of the "Consumer Rights Protection Law": "For durable goods or services such as motor vehicles, computers, televisions, refrigerators, air conditioners, washing machines, and decoration and renovation services provided by operators, if consumers discover defects within six months from the date of acceptance of the goods or services, the operator shall bear the burden of proof regarding the relevant defects in case of disputes."

Article 24 of the "Consumer Rights Protection Law": "If the goods or services provided by the operator do not meet quality requirements, consumers may return the goods according to national regulations or the agreement of the parties, or request the operator to fulfill obligations such as replacement or repair. If there are no national regulations or agreements, consumers may return the goods within seven days from the date of receipt; after seven days, if the conditions for legal termination of the contract are met, consumers may return the goods in a timely manner; if the conditions for legal termination of the contract are not met, consumers may request the operator to fulfill obligations such as replacement or repair."

Article 577 of the Civil Code: "If one party fails to perform its contractual obligations or performs them in a manner that does not conform to the agreement, it shall bear the liability for breach of contract, including continuing to perform, taking remedial measures, or compensating for losses."

Analysis:

In this case, the main risk faced by Ms. Liu is the renovation company's refusal to bear the repair responsibility for issues caused by renovation quality problems during the warranty period. The company's reason for refusing warranty lacks sufficient basis, as wall seepage is likely related to improper waterproofing during the renovation process. Moreover, the law stipulates that the burden of proof regarding the causal relationship of quality defects is reversed within a certain period, meaning the renovation company must bear the burden of proof for repair matters that do not fall under renovation quality issues.

Ways to avoid risks:

1. Clarify Contract Terms: When signing a renovation contract, be sure to detail the warranty period, warranty scope, warranty responsibilities, and repair procedures to ensure both parties have a clear understanding and agreement on warranty responsibilities.

2. Choose a Reputable Renovation Company: Select a renovation company with good reputation and service quality by reviewing their qualifications, performance, and customer evaluations to reduce risks caused by non-standard operations of the renovation company.

3. Preserve Evidence: During the renovation process and when quality issues are discovered, promptly take photos, videos, or retain other relevant evidence for use in subsequent rights protection processes.

4. Communicate Timely and Preserve Communication Records: Once quality issues or repair needs are discovered, immediately communicate with the renovation company and keep communication records for use as evidence when necessary.

5. Consult a professional lawyer: When facing a renovation company refusing to assume warranty responsibilities or repair obligations, you can consult a professional lawyer or relevant institutions for legal support to ensure your rights are effectively protected.