Property Buyer Wins Eviction and 18,000 Yuan Damages in Eastern China Home Sale Dispute
Property Buyer Wins Eviction and 18,000 Yuan Damages in Eastern China Home Sale Dispute
CASE OVERVIEW
A court in Eastern China ordered a seller to vacate a property and pay 18,000 yuan in liquidated damages for failing to deliver a sold home. The buyer had obtained full ownership but the seller remained in possession for over a year after the sale.
CASE BACKGROUND AND FACTS
On November 18, 2009, Mr. Zhou Guolei, through his authorized agent Zhong Junlong, entered into a written contract to sell a residential unit located in Eastern China to Mr. Zhou Jingde. The property included a main apartment with 117.67 square meters of floor space and a separate parking room of 4.44 square meters. The total purchase price was 630,000 yuan.
The contract specified that the seller would deliver the property and transfer the land use right certificate to the buyer after the tax and registration procedures were completed. A liquidated damages clause required the defaulting party to pay a daily penalty equal to the full purchase price for each day of delay.
The buyer fulfilled payment obligations through a debt offset arrangement. On October 15, 2009, the seller and a third party jointly borrowed 400,000 yuan from the buyer. On November 15, the seller borrowed an additional 287,800 yuan. The parties agreed that 630,000 yuan of these debts would be applied toward the purchase price.
The buyer obtained the deed tax certificate on November 18, 2009, and the property ownership certificate on November 24, 2009. Despite holding full legal title, the buyer was unable to take possession because the seller continued to occupy the property.
COURT PROCEEDINGS AND EVIDENCE
The buyer filed a lawsuit on November 24, 2010, seeking an order for the seller to vacate and pay monthly occupancy fees. The court applied simplified procedures and held a public hearing on December 30, 2010. The buyer’s legal counsel attended. The seller was properly served with notice but failed to appear or submit a defense.
The buyer submitted four key pieces of evidence: the sale contract certified by the local housing authority, the notarized power of attorney authorizing the agent to sell the property, three promissory notes documenting the loans that were offset against the purchase price, and the property ownership certificate, land use certificate, and deed tax certificate.
The court admitted all evidence as authentic, lawful, and relevant to the case. Because the seller did not appear, the court treated this as a waiver of the right to contest the buyer’s claims and evidence.
COURT FINDINGS AND JUDGMENT
The court found that a valid agency relationship existed. The seller had authorized Zhong Junlong to handle all sale-related matters, including signing contracts, collecting payments, and completing registration. The agent acted within his authority when signing the sale agreement on the seller’s behalf.
The sale contract was legally binding. Both parties had genuine intent, and the contract did not violate any prohibitive laws or regulations. The court determined that the seller breached the contract by failing to deliver the property after the buyer obtained ownership documents.
The court addressed the liquidated damages clause. The original contract set a daily penalty of 630,000 yuan for delay. The buyer voluntarily reduced the claim to 18,000 yuan for the period from November 25, 2009 to November 24, 2010, calculated at 1,500 yuan per month. The court approved this reduction as reasonable.
The court issued the following judgment: the seller must vacate and deliver the property within three months of the judgment taking effect, and must pay 18,000 yuan in liquidated damages within ten days. The seller was also ordered to bear court costs of 125 yuan.
KEY LEGAL PRINCIPLES
Contracts lawfully formed are protected and binding on all parties. Each party must fully perform its obligations. A party that fails to perform or performs improperly must bear liability for breach, including specific performance or damages.
An agent acting within the scope of authority binds the principal. The principal bears civil liability for the agent’s authorized acts.
Parties may agree on liquidated damages for breach. If the agreed amount is excessively high compared to actual loss, a court may reduce it upon request. Payment of liquidated damages for delayed performance does not excuse the breaching party from completing the performance.
PRACTICAL INSIGHTS
This case demonstrates that obtaining legal title to real property does not guarantee physical possession. Buyers should include clear delivery deadlines in purchase contracts and ensure the contract specifies consequences for delayed possession.
The buyer’s strategy of voluntarily reducing the liquidated damages claim to a reasonable amount helped secure court approval. Courts are more likely to enforce damages that are proportional to actual harm rather than punitive amounts.
Sellers who remain in properties after sale risk court-ordered eviction and monetary penalties. The three-month vacate period granted by the court was a grace period, not a right to remain indefinitely.
LEGAL REFERENCES
General Principles of the Civil Law of the People’s Republic of China: Article 63
Contract Law of the People’s Republic of China: Articles 8, 60, 107, 114, 135, 138
Civil Procedure Law of the People’s Republic of China (2007 Revision): Article 130
DISCLAIMER
This article is for informational purposes only and does not constitute legal advice. Laws and court interpretations may vary by jurisdiction. Readers should consult a qualified attorney for advice on specific legal matters.