Property Developer Ordered to Issue Title Deeds for 12 Unsold Units in Eastern China

Property Developer Ordered to Issue Title Deeds for 12 Unsold Units in Eastern China

Case Overview
A property developer in Eastern China was ordered by a local court to process and deliver property ownership certificates for 12 residential units it had sold to an investment company. The court found that the developer breached the sales contract by failing to obtain the necessary building ownership certificates and then failing to assist in the transfer of title to the buyer, even though the buyer had paid the full purchase price and taken possession of the properties.

Case Background and Facts
The plaintiff, an investment company based in Eastern China (referred to as the Buyer), entered into 12 separate commercial housing sales agreements with the defendant, a local property development company (referred to as the Developer). The contracts were for the purchase of residential units located within a development known as Jing Shun Shan Shui Jian in Eastern China. According to the contracts, the Developer was required to deliver the properties to the Buyer by January 28, 2011. Additionally, the Developer was obligated to obtain the building ownership certificate for the entire building by January 28, 2012. The contract further stipulated that the Buyer should receive its individual property ownership certificate within 365 days of the property delivery date. The Buyer fulfilled its payment obligations and took physical possession of all 12 units. However, despite these actions, the Developer failed to initiate or complete the process of registering the property titles with the relevant government authority.

Court Proceedings and Evidence
The Buyer filed a lawsuit against the Developer, requesting the court to order the Developer to handle the registration and issuance of the property ownership certificates. The Developer was properly served with the court summons but failed to appear in court or submit any written defense. The court proceeded with a default judgment. The Buyer presented key evidence, including the signed commercial housing sales contracts, payment receipts, and a summary of the contract registrations. The evidence confirmed that the Buyer had paid the full purchase price for each unit and had taken delivery of the properties. However, the evidence also showed that the Buyer had not paid the deed tax or other associated registration fees.

Court Findings and Judgment
The court reviewed the evidence and found that the 12 sales contracts were legally valid and binding on both parties. The court held that the Buyer had fully performed its primary obligation by paying the purchase price. The court determined that the Developer had breached its contractual duties by failing to obtain the initial building ownership certificate and by failing to cooperate in the transfer of individual titles. The court rejected any argument that the Buyer’s failure to pay deed tax relieved the Developer of its core duty to provide the necessary documentation and apply for registration. The court explicitly ruled that the Developer must complete the registration process and deliver the property ownership certificates to the Buyer within 30 days of the judgment taking effect. The court also ordered the Developer to bear all court costs for the 12 consolidated cases.

Key Legal Principles
The court applied the principle that a legally formed contract is binding and must be performed in good faith by all parties. The judgment reinforced the rule that a seller’s obligation to transfer title is a core duty in a property sale, distinct from a buyer’s obligation to pay taxes. The court also applied the principle that a party who fails to appear in court and present evidence bears the risk of an adverse judgment.

Practical Insights
This case serves as a clear reminder to property buyers that the developer’s failure to register a building can block the issuance of individual title deeds, even after full payment and possession. Buyers should ensure that contracts include specific deadlines for both building registration and individual title transfer. For property developers, this case underscores that the obligation to deliver title deeds is a non-delegable duty. A buyer’s failure to pay taxes does not excuse the developer from its own obligation to initiate the registration process. Developers should proactively manage the registration timeline to avoid breach of contract claims.

Legal References
Contract Law of the Peoples Republic of China, Article 44 (Validity of Contracts) and Article 60 (Full Performance). Contract Law of the Peoples Republic of China, Article 107 (Liability for Breach of Contract). Civil Procedure Law of the Peoples Republic of China, Article 144 (Default Judgment). Supreme Peoples Court Provisions on Evidence in Civil Proceedings, Article 2 (Burden of Proof).

Disclaimer
This article is for informational purposes only and does not constitute legal advice. Consult a qualified attorney for specific legal matters.