[Direct answer]In the Beijing area, it is possible, but usually requires a notice of default followed by termination. In the sale of commercial housing, if the buyer fails to pay the purchase price on time, the developer cannot immediately terminate the contract upon the buyer's default. If the contract stipulates the conditions for termination and those conditions have been satisfied, the developer may terminate the contract according to the agreement; if the contract does not stipulate such conditions, the developer generally needs to send a notice of default first. If the buyer still fails to pay within a reasonable period of time after the notice, the developer may then terminate the contract. At the same time, to protect the stability of the transaction, relevant judicial interpretations specify that if the buyer has paid most of the purchase price, the developer's claim to terminate the contract is generally not supported. When terminating the contract, the developer shall notify the buyer and, according to the actual situation, refund the paid purchase price and handle the liability for breach of contract; if a loan has been arranged, the developer shall also handle the termination of the loan contract and the assumption of liability. In summary, whether the contract can be terminated depends on a comprehensive assessment of the contract provisions, the degree of default, the proportion of the payment made, and whether a notice of default has been sent.

I. Problem Background and Typical Scenarios

Overdue payments are a common dispute in the sale of commercial housing. A typical scenario is that the buyer fails to pay the down payment or the balance on time due to reasons such as capital turnover and unapproved loans, and the developer directly sends a letter to terminate the contract and demands the buyer to bear the breach of contract penalty. The buyer, however, argues that the overdue period is relatively short and the termination is too harsh. The focus of the dispute is whether the right of termination is established and whether the procedure is legal.

II. Key points of contention

First, the contract's provisions on the conditions for termination and their effectiveness; Second, the requirements for giving notice and a reasonable time period when no such provisions exist; Third, the impact of the proportion of the purchase price already paid on the termination; Fourth, the delivery and effectiveness of the notice of termination; Fifth, the handling of the consequences of termination and breach of contract liability. In practice, the giving of notice and the proportion of the payment often determine the outcome of the case.

III. Professional analysis by Henglue Law Firm

The first layer: Contractual provisions govern the exercise of the developer's right of rescission. If the contract explicitly stipulates that the purchaser shall bear the consequences of late payment upon reaching a certain time limit or amount, the developer may exercise the right of rescission when the conditions are met; however, such provisions must be clear and reasonable, and the developer must also fulfill the obligation of notification when exercising the right of rescission. The second layer: Absence of contractual provisions requires a reminder. If the contract does not stipulate the conditions for rescission, the developer cannot directly rescind the contract. Instead, the developer must first remind the purchaser to perform within a reasonable time limit. If the purchaser still fails to make the payment after the reminder, it constitutes a fundamental breach of contract, and the developer may lawfully rescind the contract. The third layer: Restrictions on payment ratios. In judicial practice, emphasis is placed on maintaining transaction stability. Generally, the developer will not be supported in rescinding the contract if the purchaser has already paid a large portion of the purchase price, to avoid an imbalance of interests. The term "large portion" is typically determined based on the payment ratio and the specific circumstances of the case. The fourth layer: Handling of loan situations. If the purchaser pays through mortgage financing and the delay in payment is due to loan approval or disbursement issues, the developer often needs to simultaneously rescind both the sales contract and the loan contract, clarifying who will repay the remaining loan. The fifth layer: Legal consequences of rescission. After the contract is rescinded, the developer shall return the received purchase price, and both parties shall bear breach of contract liabilities according to their fault and the contract provisions. The purchaser may claim the amount paid and corresponding losses, while the developer may claim breach of contract damages, provided that the breach of contract damages are commensurate with the actual losses. Henglue Lawyers' Tip: When exercising the right of rescission, the developer should retain evidence of the reminder and delivery, while the purchaser should promptly assert the right to continue performance or raise objections to the improper rescission.

IV. Practical suggestions and legal basis

The first step is to verify the provisions of the contract regarding late payment, conditions for termination, and penalties for breach of contract. The second step is to review whether the developer has given a prior notice and a reasonable period of time for payment if the developer claims to terminate the contract. The third step is that if the buyer has paid most of the payment, they can use this as a defense against termination. The fourth step is to handle the termination and repayment of the loan contract if it involves a mortgage. The fifth step is to resolve disputes over the return of the purchase price and breach of contract liability through litigation if no agreement can be reached. The main legal basis is Articles 562, 563, and 566 of the Civil Code of the People's Republic of China; and the relevant provisions of the Interpretation of the Supreme People's Court on the Application of Law in the Trials of Disputes over Commercial Housing Sales Contracts. The specific application shall be subject to the currently effective provisions.

5. Henglu Law Firm's Advice

Three key points regarding terminating the contract due to late payment: If there is an agreement, follow the terms of the agreement; if there is no agreement, send a notice first; if the developer has already received most of the payment, the developer generally cannot terminate the contract; when terminating the contract, the developer must notify the buyer and clarify the refund of the purchase price and the compensation for breach of contract. For disputes involving the sale of commercial housing and contract termination, you can seek legal assistance through the following channels:Real estate transactions and construction projectsThe service obtains a comprehensive solution, which involves the combination of contract termination and breach of contract compensationBusiness and contract disputes in enterprisesFor reference, the plate involves the refund of funds and their executionCreditor's rights and debts, and enforcementFor columns related to difficult property disputes, you can seek advice from usSpecial servicesTeam.

VI. Frequently Asked Questions

Q1: If the buyer fails to make the payment on time, can the developer directly terminate the contract?

Generally, it is not allowed. If the contract stipulates the conditions for rescission, the developer may rescind the contract when the conditions are met; if no such conditions are stipulated, the developer shall first give notice and set a reasonable time limit. If the buyer still fails to make the payment after the notice, the developer may rescind the contract. If the developer directly rescinds the contract without going through the notice procedure, the effectiveness of the rescission may be questioned, and the buyer may raise objections and claim to continue to perform the contract.

Q2: I've already paid most of the house price. Can I still be terminated from the contract?

Generally, it is not allowed. To maintain the stability of transactions, the relevant judicial interpretations stipulate that if the buyer has paid most of the purchase price, the developer's request to rescind the contract will generally not be supported. The specific proportion needs to be determined based on the circumstances of the case. The buyer can use this to defend himself and claim to continue to perform the contract and pay the remaining amount and corresponding interest according to the agreement.

Q3: What form should the notice of default take in order to be legally binding?

It is advisable to use a written form that leaves a record, such as registered mail, express delivery, email, or a confirmed delivery method. The content should clearly state the amount owed, the payment deadline, and the consequences of non-performance. Retaining the delivery receipt and the signature record can prove that the obligation to remind the debtor has been fulfilled in the event of a dispute. It is difficult to provide evidence for oral reminders, so it is recommended to primarily use written methods.

Q4: Can the housing payment already made after the cancellation be refunded?

It is possible to claim a refund. After the contract is terminated, the developer shall return the payment already received, and both parties shall bear the liability for breach of contract according to the agreement and their respective faults. The buyer may claim the payment already made and the corresponding losses, and the developer may claim breach of contract damages, but the breach of contract damages shall be commensurate with the actual losses. If the transaction involves a mortgage, the termination and repayment of the loan contract shall also be handled concurrently.

Q5: Can I be exempt from liability if the loan application is not approved and results in a late payment?

No, it's not an automatic exemption from liability. The failure to approve a loan or a delay in disbursement does not automatically exempt one from liability. The key lies in the contractual provisions and the allocation of responsibilities. If the developer or the bank is at fault, the buyer's liability may be reduced accordingly. The buyer should communicate with the relevant parties in a timely manner, provide a written explanation of the situation, and keep the evidence to avoid losing the transaction opportunity due to being deemed to have breached the contract fundamentally by adopting a passive response.

The above answer is based on the judicial practice in Beijing. The judicial interpretations in other provinces or cities may vary. For specific cases, please refer to the local rules and evidence situation.

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 the purchase and sale of real estate·Beijing Henglu 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.