法释[2004]14号

（Promulgated¹ by the Supreme² People‘s Court on 25 October 2004 and effective as of 1 January 2005.）

颁布日期：20041025 　实施日期：20050101 　颁布单位：最高人民法院

　　This Interpretation³ is formulated⁴ in accordance with the provisions of laws such as the PRC， Civil Law General Principles， the PRC， Contract Law， the PRC， Invitation and Submission⁵ of Bids Law and the PRC， Civil Procedure Law and in light of the reality of civil adjudication， in order to address issues concerning the application of law in trial of dispute cases involving construction project contracts.

　　Article 1　In any of the following circumstances， a construction project contract shall be deemed to be invalid⁶ according to Item （5） of Article 52 of the Contract Law：

　　1. if the contractor⁸ has failed to obtain construction enterprise qualifications or undertakes a project that exceeds its qualification grade；

　　2. if an unqualified actual builder borrows the name of a qualified⁹ construction enterprise； or

　　3. if the construction project requires invitation of bids but no invitation of bids has been carried out， or the winning bid is invalid.

　　Article 2　Where a construction project contract is invalid but the construction project passes the acceptance check upon completion of construction， and the contractor requests for payment of project prices with reference to the stipulations in the contract， such request shall be upheld.

　　Article 3　Where a construction project contract is invalid and the construction project fails to pass the acceptance check upon completion of construction， the matter shall be handled according to the following circumstances respectively：

　　1. if， after repairs， the construction project passes the acceptance check upon completion of construction， and the employer requests that the expenses of repairs be borne by the contractor， such request shall be upheld；

　　2. if， after repairs， the construction project fails to pass the acceptance check upon completion of construction， and the contractor requests for payment of project prices， such request shall not be upheld.

　　Where the employer is at fault， it shall bear the corresponding civil liability for the losses incurred¹⁰ as a result of the construction project not being up to standard.

　　Article 4　If a contractor illegally assigns or subcontracts in violation¹¹ of the law the construction project or if an unqualified actual builder borrows the name of a qualified construction enterprise in the conclusion of a construction project contract with another party， such act shall be invalid. The people‘s court may confiscate¹² the illegal income already obtained by the party according to Article 134 of the Civil Law General Principles.

　　Article 5　Where a contractor concludes a construction project contract that is beyond the scope of business permitted by its qualification grade， but obtains the corresponding qualification grade before the construction project is completed， and a party requests that the matter be handled as an invalid contract， such request shall not be upheld.

　　Article 6　Where the parties have an agreement on advance payment or the interest thereon， and the contractor requests for refund¹³ of the advance payment and its interest according to the agreement， such request shall be upheld， except for the portion for which the agreed rate for calculation of interest is higher than the interest rate for the same type of loan of the same duration announced by the People‘s Bank of China.

　　Where there is no agreement on advance payment between the parties， the matter shall be handled as outstanding project sum.

　　Where there is no agreement on interest on advance payment and the contractor requests for payment of interest， such request shall not be upheld.

　　Article 7　Where a contractor with the statutory qualifications for provision of labour services concludes a labour subcontract with the general contractor and subcontractors， and the party requests that the subcontract be confirmed as invalid on the grounds that the assignment of construction project is in violation of the provisions of laws， such request shall not be upheld.

　　Article 8　If the contractor is in any of the following circumstances and the employer requests for rescission of the construction project contract， such request shall be upheld：

　　1. it has expressed explicitly¹⁴ or by its actions that it will not perform the main obligations of the contract；

　　2. it fails to complete construction within the period stipulated¹⁵ in the contract， and still fails to complete construction within the reasonable period in the reminder¹⁶ issued by the employer；

　　3. the quality of the completed construction project is not up to standard and it refuses to make repairs； or

　　4. it illegally assigns or subcontracts in violation of the law a construction project for which it contracted.

　　Article 9　If the employer is in any of the following circumstances， rendering¹⁷ it impossible for the contractor to carry out construction work， and it still fails to perform the corresponding obligations within the reasonable period in the reminder， and the contractor requests for rescission of the construction project contract， such request shall be upheld：

　　1. project prices have not been paid according to the agreement；

　　2. the main construction materials， spare parts and accessories， and equipment that it provides fail to comply with the mandatory¹⁸ standards； or

　　3. failure to perform the assistance obligations stipulated in the contract.

　　Article 10　Where the quality of the completed construction project is up to standard after the rescission of the construction project contract， the employer shall pay the corresponding project prices according to the agreement. If the completed construction project is not up to standard， the matter shall be handled according to Article 3 hereof.

　　Where a contract is rescinded¹⁹ as a result of breach²⁰ of contract by one party， the party in breach of the contract shall compensate²¹ the other party for the losses so caused.

　　Article 11　Where the quality of a construction project fails to comply with the agreement due to the fault of the contractor， and the contractor refuses to carry out repairs， rework or make alterations²²， and the employer requests for reduction in the payment of project prices， such request shall be upheld.

　　Article 12　The employer shall bear the liability for negligence²³ if it causes quality defects in the construction project in any of the following circumstances：

　　1. the design that it provides contains defects；

　　2. the construction materials， spare parts and accessories， and equipment that it provides or specifies²⁴ to be purchased fail to comply with the mandatory standards； or

　　3. it directly designates subcontractors to subcontract for professional construction.

　　If the contractor is at fault， it shall bear the corresponding liability for negligence.

　　Article 13　Where a construction project has not passed the acceptance check upon completion of construction， and the employer， after use without authorization²⁵， asserts its rights on the grounds that the portion used does not comply with the agreement， such request shall not be upheld. However， the contractor shall bear the civil liability for the foundation construction and the quality of the main structure throughout the reasonable life of the construction project.

　　Article 14　Where there is a dispute between the parties over the actual date of completion of the construction project， the matter shall be handled according to the following circumstances respectively：

　　1. if a construction project has passed the acceptance check upon completion of construction， the date of completion of construction shall be the date on which it passed the acceptance check；

　　2. if the contractor has submitted the report on acceptance check upon completion of construction but the employer delays the acceptance check， the date of completion of construction shall be the date of submission of the report； or

　　3. if a construction project has not undergone acceptance check upon completion of construction but the employer puts it into use without authorization， the date of completion of construction shall be the date on which the possession of the construction project is handed over.

　　Article 15　Where there is a dispute between the parties over the quality of construction work before its completion， and its quality has been assessed as being up to standard， the construction period shall be postponed²⁶ for the same period as the assessment²⁷ period.

　　Article 16　Where the parties have agreed on the pricing standards or methods for the construction project， project prices shall be calculated according to the agreement.

　　Where there is a change to the quantity or quality standard of the construction work for the construction project due to a change to the design， and the parties are unable to reach a consensus²⁸ through consultation²⁹ on the price for that portion of construction work， the price of construction work may be calculated according to the pricing methods or standards issued by the local administrative³⁰ department in charge of construction at the place where the construction project contract was signed.

　　Where a construction project contract is valid⁷ but the construction project fails to pass the acceptance check upon completion of construction， project prices shall be calculated according to Article 3 hereof.

　　Article 17　Where the parties have agreed on the rate for calculation and payment of interest on outstanding project prices， the matter shall be handled according to the agreement. If there is no such agreement， interest shall be calculated based on the interest rate for the same type of loan of the same duration announced by the People‘s Bank of China.

　　Article 18　Interest shall be calculated from the date on which project prices are due. If the parties have not agreed on the payment date or the agreement is unclear， the following dates shall be deemed as the date on which payment is due：

　　1. if the construction project has actually been delivered， the date of delivery；

　　2. if the construction project has not been delivered， the date of submission of settlement documents upon completion of construction； or

　　3. if the construction project has not been delivered and the project prices have not been settled， the date on which the party institutes an action.

　　Article 19　Where there is a dispute between the parties over the quantity of construction work， the quantity shall be confirmed according to the written documents such as certificates generated in the course of construction. If the contractor is able to prove that the employer has consented to the construction work but is unable to provide certificates or documents in support of the quantity of construction work， the actual quantity of construction work may be confirmed by other evidence provided by the party.

　　Article 20　Where the parties have agreed that failure to reply within the stipulated time period by the employer after receipt of construction completion and settlement documents shall be deemed as acknowledgment of the documents， the matter shall be handled according to the agreement. If the contractor requests for settlement of project prices according to the construction completion and settlement documents， such request shall be upheld.

　　Article 21　Where the parties have separately concluded a construction project contract for the same construction project that is inconsistent with the substantive³¹ contents of the winning bid contract that is filed for record， the winning bid contract filed for record shall be the basis for the settlement of project prices.

　　Article 22　Where the parties have agreed that project prices shall be settled according to a fixed³² price and one of the parties requests for assessment of the pricing of the construction project， such request shall not be upheld.

　　Article 23　Where there is a dispute between the parties over certain facts of the case， assessment shall be conducted on the disputed facts only， except where the scope of the facts in dispute cannot be determined³³ or where both parties request for assessment of all the facts.

　　Article 24　In case of a construction project contract dispute， the place where construction takes place shall be the place of performance of contract.

　　Article 25　Where a dispute arises over the quality of a construction project， the employer may institute an action against the general contractor， subcontractors， and the actual builders as co-defendants.

　　Article 26　Where the actual builder institutes an action against the assignee or illegal subcontractor as defendant³⁴， the people‘s court shall accept the case in accordance with the law.

　　Where the actual builder asserts its rights against the employer as the defendant， the people‘s court may add the assignee or illegal subcontractor as the parties in the case. The employer shall be liable to the actual builder within the scope of outstanding project prices.

　　Article 27　Where a warrantor fails to perform its warranty³⁵ obligations in a timely manner， thereby³⁶ causing damages to the building， or personal or property loss， the warrantor shall bear the liability for compensation.

　　Where both the warrantor and the owner of the building or the employer are at fault for the damages to the building， each party shall bear its corresponding liability.

　　Article 28　This Interpretation shall be implemented³⁷ as of 1 January 2005.

　　This Interpretation shall apply to cases at first instance accepted after the implementation³⁸ hereof.

　　In the event of a conflict between judicial³⁹ interpretations⁴⁰ issued by the Supreme People‘s Court before the implementation hereof and this Interpretation， this Interpretation shall prevail.

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