Dispute Over CNY 279,056 Apartment Sale Leads to Delay Claims
A homebuyer in Central China City brought a lawsuit against a real estate developer for failing to deliver a completed apartment on time and for not obtaining the required ownership certificates. The buyer sought compensation for multiple delays, including late delivery of the property, late installation of gas, and failure to secure the building’s title documents. The court examined the evidence and the terms of the sales contract, then ruled on the developer’s liability.
Mr. Chen signed a pre-sale contract with New Jinjiang Company in March 2007 to purchase an apartment in the Roland Town project for a total price of CNY 279,056. The contract stated that the developer would deliver the apartment by June 30, 2008, with full compliance including a planning approval certificate and a building completion filing. Gas installation was also required by that date. If the developer failed to deliver on time, a daily penalty of 0.02% of the total payment would apply. Additionally, the developer promised to obtain the building’s ownership certificate by December 31, 2008, and to cooperate in transferring the title to the buyer within 365 days of delivery. Mr. Chen paid the full amount, but the developer did not meet the deadlines.
The developer issued a notice for owners to take possession on June 8, 2009, and Mr. Chen actually moved in on September 9, 2009. The gas was not installed until January 30, 2010. The developer never obtained the building’s ownership certificate for the entire building. Mr. Chen filed a lawsuit in April 2010, requesting an order for the developer to deliver a compliant apartment by June 30, 2010, to process the property and land use certificates by December 31, 2010, and to pay overdue penalties and compensation totaling CNY 53,215.68, plus continuing daily penalties at 0.04% until full performance. The developer also sought reimbursement for one year of property management fees.
The court found the contract and its annexes to be legally binding. It noted that the developer had failed to meet the delivery conditions and deadlines. The court ruled that the apartment was considered delivered when Mr. Chen took possession on September 9, 2009, even though the developer had not provided the required certificates. The court ordered the developer to continue performing its obligations by obtaining the planning approval and completion filing for the property and by submitting the necessary documents for the building’s ownership certificate. Regarding the title transfer, the court held that the developer’s duty was to cooperate with the registration authorities, not to guarantee the actual issuance of the certificates.
The court calculated the delay in delivery from the contract date of June 30, 2008, to September 9, 2009, but subtracted 80 days due to the May 12, 2008 earthquake, resulting in 355 days of delay. The developer was ordered to pay the daily penalty of 0.02% for that period. The court also found that the developer failed to obtain the building’s ownership certificate by December 31, 2008, and was liable for a daily penalty of 0.01% from that date until the certificate was actually obtained. For the title transfer, the developer was required to pay a daily penalty of 0.01% starting 365 days after delivery until the buyer received the certificate, provided the delay was caused by the developer. The court rejected the buyer’s claim for a higher penalty rate of 0.04% and the request for property management fees, as those were not supported by the contract.
This case illustrates the legal consequences when a developer fails to meet contractual timelines for delivering a compliant property and obtaining title documents. Courts typically enforce the agreed-upon penalty clauses and require specific performance where feasible. Buyers should carefully document all communications and keep copies of contracts and payment records. The ruling confirms that actual possession can trigger the delivery date, but developers still must fulfill remaining regulatory obligations.
Disclaimer: This article is for informational purposes only and does not constitute legal advice.