[Direct answer]In the Beijing area, adjustments cannot generally be made at will, but there are exceptions. According to the "Interpretation of the Supreme People's Court on Legal Issues Applicable to the Trials of Construction Contract Disputes (I)", where the parties have agreed to settle the project price according to a fixed price, and one party requests an appraisal of the construction project cost, the People's Court shall not support it. Therefore, the fixed price is binding on both parties, and adjustments cannot be requested simply because it is deemed "unprofitable" afterwards; however, circumstances such as design changes, increases or decreases in the project quantity, and abnormal fluctuations in the prices of major materials that exceed the scope of the contract may allow adjustments according to the contract or legal provisions. Action guidance: First, review the risk scope and adjustment clauses in the contract, then determine whether there are grounds and evidence for adjustment.
I. Problem Background and Typical Scenarios
Fixed-price contracts are very common in construction projects. When signing the contract, the contractor is responsible for the total cost based on the estimate, but during the construction process, there may be changes, price increases, and other situations. A typical scenario is that the contractor signs a contract at a fixed price, but the cost increases significantly due to the employer's request to add project content; or the material prices rise sharply, and the contractor suffers serious losses and wants to adjust the price. The fixed price is not absolutely unchangeable. The key is to see "whether it exceeds the agreed scope".
II. Key points of contention
Firstly, the binding force of fixed prices and appraisal restrictions; Secondly, which circumstances constitute adjustable exceptions; Thirdly, the pricing methods for design changes and increases or decreases in project quantities; Fourthly, whether the price fluctuations of materials can be adjusted. The core issue is: how to delineate the risk scope of the contract.
III. Professional analysis by Henglue Law Firm
The experience of Henglu Law Firm in handling construction project cases shows that the deciding factor of fixed-price contracts lies in the "risk scope clause". Firstly, the binding force of fixed-price contracts stems from the parties' autonomous allocation of price risks. Therefore, if a party requests an appraisal of the project cost after settlement according to the fixed price, the court usually does not support such requests. This means that the contractor cannot simply demand a price adjustment on the grounds that the actual cost is higher than the contract price. Secondly, adjustable exceptions mainly focus on changes outside the scope of the contract, such as the employer's instructions to increase or reduce the project content, design changes leading to changes in the project quantity, and adjustments confirmed by additional certificates signed by both parties. These changes usually require written evidence such as additional certificates, change orders, and meeting minutes. Thirdly, whether the material price fluctuations can be adjusted depends on whether the contract stipulates a price adjustment clause and whether the fluctuation range meets the agreed threshold. If the contract explicitly stipulates that no adjustment is allowed, the contractor's room for claiming adjustment is limited, unless it constitutes a statutory circumstance such as a change in circumstances. In practice, contractors often make mistakes: they carry out change items solely based on verbal instructions, without additional certificates or records afterwards, making it difficult to claim adjustments; or the contract lacks clear provisions on the risk scope, leading to conflicting interpretations afterwards. Therefore, it is recommended to strictly implement the procedures of additional certificates and changes during the construction process, and obtain written confirmations for all work exceeding the contract scope in a timely manner. When courts in Beijing handle such cases, they usually focus on whether the contractual provisions and the facts of the changes justify an adjustment. The completeness of the evidence is crucial. It should be noted that before signing the contract, it is necessary to carefully review the risk scope, change pricing methods, and price adjustment clauses of the fixed-price contract, and clearly stipulate possible changes in advance to avoid disputes afterwards. Similarly, in areas such as commercial housing sales, the contractual provisions on breach of contract liability also affect the outcome of claims - in a commercial housing pre-sale contract dispute handled by Henglu Law Firm, the developer failed to deliver the house on time for nearly nine months. The court ordered the developer to pay the full breach of contract penalty of 118,366.12 yuan according to the contractually agreed penalty standard, confirming the judicial logic of "agreement takes precedence". This case was handled by Beijing Henglu Law Firm.Tian JiayanThe attorney (practice license number: 11101202111381309, subject to the document issued by the judicial administrative organ) acts as the agent.
IV. Practical suggestions and legal basis
The first step is to review the fixed price range, change pricing and price adjustment clauses in the contract; the second step is to handle visas and change confirmations for work exceeding the contract scope in a timely manner during construction; the third step is to preserve evidence such as material procurement prices, project quantities, and change orders; and the fourth step is to claim adjustments in accordance with the agreement when disputes arise, and to resolve them through litigation and appraisal if necessary. The main legal basis is the "Interpretation of the Supreme People's Court on Legal Issues Applicable to the Trials of Construction Contract Disputes" (effective from January 1, 2021) and the provisions on construction contracts and changes in circumstances in the Contract Chapter of the Civil Code of the People's Republic of China. The specific application shall be subject to the currently effective laws, regulations, and judicial rulings.
5. Henglu Law Firm's Reminder
The fixed price is not set in stone: if there are changes outside the contract, adjust them as needed; if there are risks within the contract, bear them yourself. Timely obtaining visas and having evidence in hand will give you room for negotiation. For matters involving the settlement of construction projects, you can proceed through the following channels:Property transactions and construction projectsObtain a comprehensive solution for the service; those involving contracts and commercial disputes can be integrated togetherBusiness and contract disputes in enterprisesPlate; for reference on the enforcement of project paymentsCreditor's rights and debts, and enforcement; For real estate transactions, please feel free to consult usDivorce litigation and family disputesOther difficult issues can be resolved throughSpecial servicesDocking.
VI. Frequently Asked Questions
Q1: If we sign a fixed-price contract, can we request a price increase afterwards?
Generally, a price increase cannot be requested solely due to cost changes. Where the contract stipulates that the settlement shall be based on a fixed price, the court usually does not support an appraisal of the project cost. However, if there are design changes, increases or decreases in the project quantity, or other circumstances beyond the scope of the contract, the adjustment may be claimed in accordance with the contract or the law.
Q2: What evidence is needed to support the proposal for adjustment?
It is necessary to prepare the construction contract, change orders or design change documents, visa forms, meeting minutes, confirmation records of the amount of work, material purchase and price certificates, as well as correspondence. Written evidence is the key to determining whether the project exceeds the agreed scope.
Q3: How are the costs of such engineering disputes calculated?
The litigation fees shall be paid in stages according to the amount of the subject matter; the appraisal fees shall be paid separately if the case involves appraisal of construction costs. The attorney's fees shall be agreed upon based on the complexity of the dispute and the workload. It is recommended to first assess whether the grounds for adjustment are valid, and then decide whether to proceed with appraisal and litigation.
Q4: How long does it usually take to resolve a dispute over project payments?
The first-instance ordinary procedure generally lasts six months, and the simplified procedure lasts three months; cases involving appraisals will be significantly prolonged. If the focus of the dispute is on changing the facts and the pricing method, clear evidence can help shorten the timeframe.
Q5: Can we still request adjustments for projects that have been verbally modified?
It's quite challenging, but not impossible. Changes in the facts can be supported by construction records, on-site photos, correspondence, supervision and meeting minutes, witness statements, etc. If the employer also confirms the project quantity afterwards, the claim can be based on this. It is recommended that all future changes be handled with written approval in a timely manner.
This article is written based on the common judicial interpretations in the Beijing area. If the case occurs in other regions, it is recommended to consult local lawyers to verify the regional differences.
If you are facing similar problems, it is recommended that you consult a professional lawyer as soon as possible with the evidence materials, so as to avoid missing the statutory time limit. →Legal services for real estate transactions·Beijing Henglue Law Firm
Disclaimer: This article is compiled based on the current effective laws and regulations and public adjudication rules, and is for general reference only. It does not constitute a formal legal opinion on specific cases. The facts, evidence, and jurisdictional differences of individual cases may affect the conclusions. If you encounter disputes, please consult a practicing lawyer in time.