[Case Summary]This case involves a dispute over a housing sales contract. After purchasing a house in Shunyi District, Wang * failed to complete the loan procedures, and the developer (** Company) sued to terminate the contract, cancel the online signing, evict Wang * from the house, and claimed a breach of contract penalty of 215,865.5 yuan and attorney's fees of 30,000 yuan, etc. Wang * entrusted Beijing Henglu Law Firm to handle the case.Wang FangliThe lawyer represented the defendant in the lawsuit, with the core disputes being whether the liquidated damages were too high, whether the liquidated damages for late check-out should be supported, and whether the attorney's fees should be supported. The applicable legal provisions are those of the Civil Code of the People's Republic of China. The court ruled that the excessive part of the liquidated damages would not be supported, and ultimately decided to terminate the contract. Wang * only needed to pay 40,000 yuan in liquidated damages and 30,000 yuan in attorney's fees. The developer refunded the 688,655 yuan in paid purchase prices, significantly reducing the parties' losses.

I. Review of the Case

Buyers often search for terms like "What should I do if the developer wants to terminate the contract due to delayed loan processing?", "Is it reasonable for the developer to demand high penalties for breach of contract?", and "How can I defend against excessive penalties for breach of contract when buying a house?". In March 2022, Wang * purchased a house at No. 602 in Shunyi District. However, due to his failure to pay the remaining down payment and complete the loan procedures, ** Company sued Wang * in court, demanding to terminate the contract and other remedies. During the trial, the two parties reached a settlement agreement on November 8, 2022: Wang * exchanged the house at No. 602 in Shunyi District for a house at No. 301 in Shunyi District, and was required to complete the bank mortgage loan procedures before November 15, 2022, and pay the remaining purchase price of 1.4 million yuan with the mortgage loan. Subsequently, ** Company withdrew its lawsuit. On December 3, 2022, the two parties signed the filing version of the "Commercial Housing Pre-sale Contract" and completed the online signing procedures. The house was delivered and occupied on January 17, 2023.

Later, due to Wang's failure to handle the loan on schedule, ** Company issued a collection notice on July 17, 2023, and the saving notices delivered on August 14 and October 25 were all returned. Therefore, ** Company initiated this lawsuit, requesting the court to order the termination of the pre-sale contract, the cancellation of the online signing, the eviction of the house, the payment of a breach of contract penalty of 215,865.5 yuan, the breach of contract penalty for late check-out, and the attorney's fees of 30,000 yuan.

II. The focus of the case

  • Focus 1: Is the penalty for breach of contract claimed by the developer of nearly 300,000 yuan too high?The lawyer argued that the court should not support the part of the penalty that was too high, and in the end, the court did not support the excessive part.
  • Focus 2: Is the penalty for late check-out based on a reasonable calculation?The court found that the plaintiff's claims were unfounded and did not support them.
  • Focus Three: How to handle the attorney's fees and the paid housing deposit.The court supported the attorney's fee of 30,000 yuan and ruled that the developer should refund the purchase price of 688,655 yuan after deducting the relevant fees.

III. The professional intervention of Hengluo Law Firm

The plaintiff originally claimed that (the developer):The company claimed that Wang *'s failure to handle the loan on time constituted a breach of contract, and requested to terminate the pre-sale contract between the two parties, cancel the online signing, vacate the house, pay a breach of contract penalty of 215,865.5 yuan, a breach of contract penalty for failing to handle the check-out procedures on time, and attorney's fees of 30,000 yuan.

The defendant argued (Wang * was represented by Hengluo Law Firm):Wang * entrustedWang FangliThe lawyer, acting on behalf of the client, stated that he did not intentionally delay the payment of the remaining housing price. He originally planned to use a combination loan to pay the remaining housing price, as the unit's welfare could provide a 1.2 million yuan housing provident fund loan, and due to family reasons, he was unable to pay an additional 200,000 yuan. Therefore, he negotiated with the developer about a combination loan, but the developer refused to agree. During the trial, the lawyer agreed to terminate the contract, cancel the online signing, and vacate the house, but refused to pay the breach of contract penalty and attorney's fees. He also requested the court to resolve the consequences of terminating the contract, including the return of the down payment already paid.

IV. Outcome of the case

After the trial, the court held that: The plaintiff claimed that the breach of contract penalty was too high, and the court did not support the part that was too high; the plaintiff claimed that the breach of contract penalty for late check-out procedures was unfounded and was not supported. In the final judgment, the pre-sale contract signed by both parties was rescinded, and Wang * only needed to pay a breach of contract penalty of 40,000 yuan and attorney's fees of 30,000 yuan, and vacate the house within 15 days; after deducting the above-mentioned amounts, the plaintiff would refund Wang * 688,655 yuan of the purchase price within 15 days. This greatly reduced the parties' losses and successfully protected their legitimate rights and interests.

5. Henglu Law Firm's Reminder

This case is represented by Attorney Wang Fangli of Beijing Henglu Law Firm (practice license number: 11101201911086939, subject to the document issued by the judicial administrative organ). In the dispute over the house purchase contract, if the developer's claim for the breach of contract penalty is obviously too high, the buyer may request the court to reduce it according to law; the buyer should actively provide evidence regarding the reasons for the obstacles in the loan process, the negotiation process, and the contract terms. After the contract is terminated, the paid purchase price shall be refunded after deducting reasonable expenses, and the buyer may claim it together with other rights.

VI. Common Questions and Answers about Real Estate Transactions

  1. Q: If the developer terminates the contract and charges a high penalty fee when the loan application is overdue, what should I do?
    A:You can argue that the penalty for breach of contract is too high and request the court to reduce it. You should also provide evidence about the reasons for the loan being blocked and the negotiation process. The lawyer will distinguish between the reasonable and excessive parts of the penalty.
  2. Q: Can I request to reduce the excessive penalty for breaching the contract when buying a house?
    A:Yes. If the party concerned believes that the agreed penalty for breach of contract is excessively high compared to the actual losses caused, he/she may request the people's court to reduce it appropriately.
  3. Q: Who is responsible for the overdue payment if the joint loan cannot be processed successfully?
    A:It depends on the provisions of the contract and the negotiation between the two parties. If the buyer has actively communicated and is not intentionally delaying the payment, this can be used as a reason to mitigate the liability.
  4. Q: Can I get a refund for the down payment I've already paid after the contract is terminated?
    A:Yes. After the termination, the seller shall, after deducting reasonable amounts (such as the penalty for breach of contract and attorney's fees), refund the remaining purchase price paid to the buyer.
  5. Q: Do we have to pay the attorney's fees claimed by the developer?
    A:There must be a contractual agreement and the actual occurrence of the event; in this case, the court supported the attorney's fee of 30,000 yuan, but the part of the penalty exceeding the reasonable limit was reduced.