Court Awards CNY 11,713 for Delayed Property Registration
In a recent decision from a court in Eastern China City, a property developer was ordered to pay damages for failing to register a buyer’s property title within the contractually agreed timeframe. The buyer, Mr. Li, sought compensation after the developer delayed providing necessary documents to the registration authorities. The court ruled in favor of the buyer, finding the developer liable for breach of contract and awarding a penalty equal to three percent of the purchase price.
The dispute arose from a sale and purchase agreement signed on 28 October 2006, under which Mr. Li bought an apartment and an accessory room from Eastern China City Real Estate Development Co., Ltd. for a total price of 413,155 CNY. The contract included a clause requiring the developer to submit all documents needed for property title registration to the relevant authority within 180 days of delivering the property. If the buyer could not obtain the title due to the developer’s fault, the buyer could either cancel the contract and receive a five percent penalty, or keep the property and claim a three percent penalty based on the price paid. The property was delivered on 13 August 2007, and the developer collected fees to handle the registration on the buyer’s behalf. However, the developer did not complete the registration until 2010, citing a conflict between local and provincial regulations about greenery coverage ratios as the reason for the delay.
During the court hearing, Mr. Li presented several key pieces of evidence, including the original sales contract, a payment invoice showing an actual total payment of 390,442.40 CNY, a notice from the developer dated 12 October 2009 informing residents that title registration could finally proceed, and the property ownership certificate issued on 17 January 2010. The developer did not attend the hearing or submit any evidence in its defense. The court accepted all of Mr. Li’s evidence as authentic, lawful, and mutually corroborative, and noted that the developer’s absence amounted to a waiver of its right to challenge or cross-examine the evidence.
The court found that the developer had failed to provide evidence showing it had submitted the required registration documents within the 180-day period, or that the delay was not its fault. Under the terms of the contract, the developer bore the burden of proving its compliance. Since it did not do so, the court determined that the developer had breached the contract. Even if the delay was caused by a third party—such as conflicting government regulations—the court applied Article 121 of the Chinese Contract Law, which states that a party who breaches a contract due to a third party’s actions must still bear liability to the other party. Therefore, the developer was held responsible for the delayed registration.
The legal analysis turned on the explicit wording of the contract and the applicable law. The contract’s clause 15 clearly set out the developer’s obligation to submit documents within 180 days of delivery and prescribed a specific penalty