[Direct answer]In the Beijing area, when developers fail to deliver housing on time, owners may claim breach of contract penalties according to the contract, or request continued performance, rescission of the contract, and compensation for losses if conditions are met. According to Article 577 of the Civil Code of the People's Republic of China (effective January 1, 2021), a party that fails to perform its contractual obligations or performs them in a manner inconsistent with the contract shall bear contractual liabilities such as continued performance, remedial measures, or compensation for losses. Commercial housing sales contracts typically stipulate delivery deadlines and breach of contract penalties, and supplementary agreements may also set grace periods. Owners should first review the contract and supplementary agreements to determine whether the starting date of the delay and the grace period can be cumulated, and pay attention to developers' common claims of force majeure exemption from liability due to factors such as the pandemic, weather, and meetings. Legal remedies include negotiation, sending letters of demand, litigation, or arbitration, while preserving evidence and preventing losses from expanding.

1. Problem background and typical scenarios

Delayed delivery of housing is a common type of dispute in commercial housing sales contracts. Typical situations include: the agreed delivery deadline has passed but the completion and acceptance filing has not been obtained, and the house cannot be delivered; the developer claims force majeure exemption from liability due to factors such as the pandemic, bad weather, or government meetings; the supplementary agreement sets a grace period, and the parties disagree on whether to accumulate other extensions; the house has been delivered but there are quality defects; the owner wants to receive the breach of contract penalty and return the house at the same time, and needs to determine which path is more beneficial. When handling such matters in Beijing, lawyers usually first check the provisions of the "Beijing Commercial Housing Pre-sale Contract" and the supplementary agreement regarding the delivery deadline, the grace period, and the breach of contract penalty standard.Real estate transactions and construction projectsIn business, the delivery time of the house and the base amount of the breach of contract penalty are common points of dispute.

II. Key points of contention

Focus One: How to determine the starting date of the delay in handover of the house and whether the grace period should be deducted. Focus Two: Whether factors such as the pandemic, weather conditions, and government meetings can constitute force majeure and exempt the developer from liability. Focus Three: Whether the standard of the penalty clause can be adjusted if it is too low or too high. Focus Four: Whether the owner can claim both the penalty and the termination of the contract simultaneously. Focus Five: Whether the existence of quality defects in the house affects the determination of the delay. Focus Six: How to calculate the delay when the developer only sends a notice but does not actually meet the delivery conditions. Focus Seven: How to allocate the burden of proof and the statute of limitations in litigation.

III. Professional analysis by Henglue Lawyers

Henglue Law Firm advises that the key to protecting rights in the event of delayed delivery of a house is the defense and attack of the evidence chain and exemption from liability. Firstly, it is necessary to fix the contract, supplementary agreement, payment vouchers, completion and acceptance filing materials, and move-in notifications to clarify the delivery date and the actual delivery date. Secondly, regarding the developer's claim of force majeure, it is necessary to review the occurrence time and predictability of the event: if the relevant circumstances were already normal at the time of signing the contract and the developer had the ability to foresee them, it would generally not constitute force majeure. Thirdly, the extension period clause should be strictly interpreted according to the contract, and there is usually no basis for claiming that it can be cumulated with other extensions. Taking the commercial housing pre-sale contract dispute handled by Attorney Tian Jiaoyan of our firm as an example: On April 30, 2021, Zhang Quan signed the "Beijing City Commercial Housing Pre-sale Contract" with a real estate development company in Beijing to purchase House No. 302 in a certain residential area with a total price of 6,841,972 yuan, agreeing to deliver the house before June 15, 2023. The supplementary agreement granted a 90-day extension period, and after the expiration of the period, the developer would pay the breach of contract penalty at a rate of 0.01% of the total price per day. The developer claimed that the construction was delayed due to force majeure such as the pandemic, meetings, and weather for 187 days, and the house was not delivered until March 5, 2024. The lawyer sorted out the delivery time, extension period, and breach of contract penalty standard, collected payment vouchers, move-in notifications, and completion and acceptance filing materials, and argued that the pandemic was already normal before signing the contract and the developer should have foreseen it, so it did not constitute force majeure. The extension period should be strictly applied. In the end, the court ruled in favor of the plaintiff, and the full breach of contract penalty of 118,366.12 yuan was awarded. This case was handled by Beijing Henglue Law Firm.Tian JiayanThe attorney (practice license number: 11101202111381309, subject to the document issued by the judicial administrative organ) acts as the agent. This case shows that whether the defense of exemption from liability can be established depends on the predictability of the event and the strict interpretation of the contract terms.

IV. Practical suggestions and legal basis

Action suggestions: 1. Review the contract and supplementary agreements to determine the delivery deadline, grace period, and default penalty standards. 2. Send a timely reminder letter and retain the delivery receipt. 3. Collect evidence such as payment records, delivery notifications, and acceptance registration documents. 4. Assess whether the defense of force majeure is valid. 5. Based on your needs, choose to claim default penalties, demand performance of the contract, or terminate the contract and seek compensation. Legal basis: Articles 577, 563, and 585 of the Civil Code of the People's Republic of China (effective January 1, 2021); Articles regarding late delivery of use in the Interpretation of the Supreme People's Court on Several Issues Concerning the Application of Law in the Trials of Disputes over Commercial Housing Sales Contracts. For real estate transactions, please refer to the relevant provisions.Property sales and construction projectsThe specific application shall be subject to the currently effective laws, regulations, and judicial rulings.

5. Henglue Law Firm's Advice

Firstly, if the delivery of the house is delayed, the buyer can claim the breach of contract penalty according to the contract. Secondly, whether the extension period can be cumulative depends on the contract provisions and cannot be arbitrarily extended. Thirdly, the defense of force majeure relies on its predictability. Fourthly, defects in the quality of the house do not necessarily exempt the seller from the responsibility for the delay. Fifthly, if the breach of contract penalty is too high or too low, the buyer can request an adjustment. For property disputes, the parties involved can seek legal assistance through the court system.Real estate transactions and construction projectsConsultation. The rules on time limits and evidence shall be subject to the currently effective laws, regulations, and judicial rulings.

VI. Frequently Asked Questions

Q1: Can I claim the breach of contract penalty if the developer delays the handover of the house?

Yes. If the developer fails to deliver the property on time as stipulated in the contract, the owner may claim the breach of contract penalty according to the contract. It is necessary to check the grace period clause. If the developer still fails to deliver the property after the grace period expires, the owner can claim compensation. If the contract does not stipulate a standard, the owner may refer to the rent of similar houses in the same area or the actual losses to claim compensation.

Q2: Can the pandemic be used as a reason to exempt oneself from liability for late delivery of housing?

It depends on the signing time of the contract and its predictability. If the epidemic situation had already become normal when the contract was signed, and the developer should have foreseen it, the developer generally cannot be exempted from liability on this basis. Factors such as bad weather, government meetings, and exams, which do not necessarily lead to a full-scale suspension of work, usually do not constitute force majeure and cannot exempt the developer from liability for delays.

Q3: Can the grace period be cumulated with other extensions?

Generally, this is not allowed. The grace period is a reasonable buffer period granted by the buyer to the seller. When there are disputes between the two parties about whether the grace period can be cumulated with other extensions, the interpretation of the agreement shall generally be strict. Claims for cumulation that lack contractual and legal basis are unlikely to be supported. The owner should judge based on the specific provisions of the supplementary agreement.

Q4: Can I request an increase in the penalty fee if it's too low?

Yes. If the agreed penalty is excessively lower than the actual loss, the party concerned may request the court or arbitration institution to increase it; conversely, if it is excessively higher than the loss, the other party may also request an appropriate reduction. When claiming an adjustment, the party concerned should submit evidence such as the rental standard and the actual loss, and the adjudicator will determine the amount based on these evidences.

Q5: Can I still claim the penalty for late delivery even though I have already received the house?

Generally, it's acceptable. Accepting the house delivery only indicates that the buyer accepts the delivery, but it doesn't necessarily exempt the developer from its breach of contract liability during the delay period, unless the contract explicitly stipulates that accepting the delivery is deemed as a waiver. The buyer can still claim breach of contract damages during the delay period, and it is recommended to keep the notice of house delivery and the proof of the time of accepting the delivery. For the relevant procedures, please refer to the following link:Real estate transactions and construction projects.

The above Q&A is mainly based on the judicial practice in the Beijing area. There may be differences in the adjudication guidelines in different regions. It is recommended to consult a professional lawyer based on the specific circumstances of the case.

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·Attorney Tian Jiayan·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.