[Direct answer]In the Beijing area, it's not necessarily invalid, nor does it necessarily require full settlement. The key lies in whether the project has passed the acceptance inspection. If the construction project fails to obtain the construction project planning permit and other planning approval procedures, the construction contract may be deemed invalid for violating mandatory legal provisions; but according to Article 793 of the Civil Code, if the construction project contract is invalid and the project has passed the acceptance inspection, the contractor may be compensated at a discounted price according to the contract's provisions on the project price; if the acceptance inspection is not passed, the project shall be repaired, reworked, and the parties shall share the liability for the defects in accordance with the contract. In other words, whether the settlement can proceed first depends on the validity of the contract, and then on the quality of the project after the acceptance inspection: if it passes the inspection, the contractor can be compensated at a discounted price; if it fails the inspection, the contractor must first repair the project. If the project still fails the inspection after repair, the contractor may not be able to obtain the corresponding payment. This is based on Articles 40 and 64 of the Urban and Rural Planning Law of the People's Republic of China, and Article 793 of the Civil Code of the People's Republic of China.

1. Problem background and typical scenarios

After the project is completed, the employer refuses to pay or presses down the price on the grounds that "the project has not obtained the construction project planning license", which is not uncommon in urban village renovation, factory building additions, temporary buildings, and illegal construction projects. The contractor is worried that if the contract is invalid, he won't get a penny, while the employer wants to use the "illegal construction" as an excuse to reject the payment. In construction disputes in Beijing, the lack of planning permits often becomes the core controversy in settlement negotiations and litigation.

II. Key points of contention

Firstly, the impact of the lack of planning permission on the validity of the contract. Secondly, how to calculate the project payment after the contract is invalidated. Thirdly, the standards for determining whether the project has passed the acceptance. Fourthly, how to apportion the responsibility for quality issues and faults.

III. Professional analysis by Henglue Lawyers

The first layer is the determination of effectiveness: Failure to obtain construction project planning permits and other planning approval procedures constitutes a violation of mandatory provisions, and related construction contracts are often deemed invalid in practice; however, the invalidity of the contract does not mean that the contractor loses all rights. The law provides a path of "discounted compensation" for invalid contracts. The second layer is discounted compensation: According to Article 793 of the Civil Code, if the contract is invalid but the project passes the acceptance inspection, the contractor may be compensated at a discounted rate based on the contract's provisions on project payment. This means that the contractor can still claim the contract price, but the basis of the claim shifts from "contract performance" to "discounted compensation". The third layer is acceptance and quality: Passing the acceptance inspection is a prerequisite for obtaining discounted compensation. If the inspection fails, the contractor should first repair the project. After the repair, if the project passes the inspection, the contractor can claim the payment, and the repair costs shall be borne by the responsible party. If the project still fails after the repair, the contractor's request for payment of the corresponding price will generally not be supported. The fourth layer is fault and liability sharing: The employer is usually primarily at fault for failing to obtain planning permits, as they should have handled the approval procedures in accordance with the law. If both parties are at fault, the losses shall be shared according to the degree of fault. In practice, this needs to be judged comprehensively based on the attribution of the obligation to apply for approval, the progress of payment, and the preservation of construction records. Related disputes can be resolved through legal means.Property transactions and construction projectsOverall handling of the service.

IV. Practical suggestions and legal basis

The first step is to collect planning approval documents, construction permits, contracts, and bidding and tendering documents, and identify the reasons for the lack of certificates and the parties responsible for the construction approval obligations. The second step is to fix the project acceptance records, supervision signatures, and completion materials to prove the project quality and completion quantity. The third step is to apply for project quality appraisal in a timely manner if there are disputes over quality to determine whether the project meets standards and to calculate the repair costs. The fourth step is to claim project payments based on discounted compensation rather than just claiming breach of contract liability if the contract is invalid. The fifth step is to pay attention to the priority of compensation for project payments and the statute of limitations, and to assert claims in a timely manner to avoid losing rights. Main legal basis: Articles 788, 793, and 799 of the Civil Code of the People's Republic of China; Articles 40 and 64 of the Urban and Rural Planning Law of the People's Republic of China; the provisions of the Interpretation of the Supreme People's Court on Legal Issues Concerning the Trials of Construction Contract Disputes regarding the application of contract-based discounted compensation when the contract is invalid and the acceptance is qualified; specific applications shall be subject to the currently effective regulations.

5. Henglue Law Firm's Reminder

There are three key points to settle the accounts of projects without planning permits: the contract may be invalid, but it doesn't mean you can't get paid; if the project passes the acceptance, you can refer to the contract for compensation at a discounted price; if it fails to pass the acceptance, you need to repair it first; the employer is usually the main party at fault for not obtaining the certificate, and the fault and quality determine the final amount. For real estate sales and construction projects, you can resolve the disputes through legal means.Real estate transactions and construction projectsWe provide a comprehensive solution for services, which can be integrated with the commercial contracts of enterprisesBusiness and contract disputes in enterprisesFor reference, you can check the sections related to creditor recovery and enforcementCreditor's rights and debts, and enforcementFor any questions regarding difficult cases, please feel free to consult us.Special servicesTeam.

VI. Frequently Asked Questions

Q1: Is the construction contract necessarily invalid without planning permission?

It is usually deemed invalid due to violating mandatory provisions of the law; however, the invalidity of the contract does not preclude the contractor from claiming the project payment through the path of compensation in lieu of damages.

Q2: Can I still get the project payment even if the contract is invalid?

Yes. If the project experience is qualified, the contractor can be compensated at a discounted price in accordance with the contract's provisions on the project price; this is a remedy reserved by the law for invalid contracts.

Q3: What should I do if the acceptance is not satisfactory?

It should be repaired first. After the repair, the contractor who meets the requirements may claim the payment, and the repair costs shall be borne by the responsible party. If the repair is still unsatisfactory after the repair, the request for the corresponding payment will generally not be supported.

Q4: Who will bear the losses caused by not obtaining the necessary permits?

The employer usually bears the main obligations and liabilities for handling planning approval. If both parties are at fault, the liability shall be apportioned according to the degree of their fault, and this shall be determined in light of the obligation to apply for construction approval and the assessment of evidence.

Q5: Which evidence should be fixed first?

The contract, construction and supervision records, completion and acceptance materials, settlement and payment vouchers, and, if necessary, applying for an engineering quality appraisal to determine whether the project meets the requirements.

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, 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 open 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.