[Direct answer]In the Beijing area, if a developer fails to deliver the property on time, buyers can apply for compensation according to law. According to Articles 577 and 585 of the Civil Code of the People's Republic of China (effective January 1, 2021), if a party fails to perform its contractual obligations or performs them in a manner inconsistent with the agreement, it shall bear contractual liabilities such as continuing to perform the contract, taking remedial measures, or compensating for losses; if the agreed penalty for breach of contract is lower than the actual losses, the buyer may request an increase; if it is excessively higher than the actual losses, the buyer may request a reasonable reduction. The penalty for late delivery of the property is usually calculated according to the standard agreed in the contract and the actual number of days of delay. If the delay meets the contractual conditions for termination or constitutes a fundamental breach of contract, the buyer may request to terminate the contract, return the paid purchase price, and claim breach of contract liability. At the same time, the termination of the mortgage loan contract may be handled concurrently. The specific provisions shall be subject to the contractual agreements and the current effective laws, regulations, and judicial rulings. For reference only.Property transactions and construction projectsThe service description in the column.

I. Problem Background and Typical Scenarios

Most people who consult this issue are home buyers who have encountered delays in the delivery of their homes. There are three common scenarios: delays due to construction progress or funding issues on the part of the developer; delays caused by force majeure or policy adjustments; and projects that have been suspended and resulted in long-term delays. In practice, the most common disputes involve the determination of force majeure and its exemption effect, as well as whether the contractually agreed penalty clauses are too high or too low. Another common problem is that home buyers only claim penalties without evaluating the feasibility of terminating the contract, resulting in uncovered subsequent capital occupancy and interest losses. Therefore, to address such issues, it is necessary to first clarify the objectives of the claim, then design a corresponding request combination, and simultaneously evaluate the cost of capital occupancy.

II. Key points of contention

Focus One: The fact of delayed delivery of the house and the starting point of calculation, the application of the grace period and the agreed delivery period. Focus Two: The establishment of force majeure and exemption clauses and their impact on the breach of contract penalty. Focus Three: The agreement and adjustment of the breach of contract penalty standard. Focus Four: Whether the conditions for contract termination have been met. Focus Five: The claim for the return of the paid house price and interest. Focus Six: The concurrent handling of the mortgage loan contract. Focus Seven: The concurrent handling of housing quality issues and delayed delivery. Focus Eight: The application of preservation and protection of the buyer's rights. The rules on breach of contract liability and contract termination can be referred to for reference.Business and contract disputes in enterprisesThe instructions in the column.

III. Professional analysis by Henglue Lawyers

Take the case of a breach of contract penalty for delayed delivery of a house handled by Attorney Tian Jiaoyan of our firm as an example: The buyer signed a pre-sale contract for a commercial housing project in 2021, which stipulated that the developer should deliver the house within the agreed time limit. The supplementary agreement granted a certain number of days of grace period, and after the expiration of the grace period, the breach of contract penalty would be calculated at a rate of 0.01% of the contract price per day. However, the actual delivery time of the developer was much later than the agreed date, with a delay of nearly nine months. The attorney's argument focused on three key points: First, the scope of application of the grace period, clarifying that the breach of contract penalty would only start to be calculated after the expiration of the grace period; Second, the exclusion of force majeure, explaining that relevant factors do not constitute grounds for exemption from liability; Third, the application of the breach of contract penalty standard, arguing that it should be calculated according to the contractual standard and should not be adjusted. The court adopted the attorney's opinion and ordered the developer to pay the full breach of contract penalty. This case shows that the key to claiming breach of contract penalties lies in accurately interpreting the contract terms: any misunderstanding of the grace period, the starting point of calculation, or the calculation standard will directly affect the final amount. For specific calculation methods, please refer to the relevant provisions of the contract.Special services and other casesThis is a column. The 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

Action suggestions: 1. Check the delivery deadline, grace period, and penalty clause in the purchase contract and supplementary agreement. 2. Obtain evidence of the actual delivery time, including delivery notices, completion and acceptance certificates, and document processing materials. 3. Collect the developer's notifications regarding the reasons for the delay and evaluate whether they constitute exempting circumstances. 4. Calculate the amount of the penalty and the interest on the paid housing price. 5. Assess whether the conditions for contract termination have been met and the deadline for exercising the right of termination. 6. If the case involves a mortgage, simultaneously review the processing path of the loan contract. 7. Claim other losses in the lawsuit and pay attention to the statute of limitations. Legal basis: Articles 577, 583, 585, and 563 of the Civil Code of the People's Republic of China (effective January 1, 2021); Related judicial interpretations on disputes over commercial housing sales contracts (based on the currently effective version); Specifically, refer to the currently effective laws, regulations, and judicial rulings.

5. Henglu Law Firm's Reminder

Firstly, it is necessary to verify the agreed grace period when calculating the starting point of the penalty clause, as this is the most common source of calculation errors. Secondly, the requirements for constituting force majeure are strict, and circumstances that do not constitute grounds for exemption from liability should not be accepted. Thirdly, if the standard of the penalty clause is too high or too low, it is possible to request an adjustment, but this requires sufficient justification. Fourthly, the right to rescind the contract is usually subject to a time limit for exercise, and it should be exercised within the time limit. Fifthly, when rescinding the contract, the handling of the mortgage loan often needs to be resolved simultaneously, and it is recommended to plan it as a whole. Sixthly, there may be both late delivery and quality defects, so attention should be paid to the completeness of the request. Seventhly, attention should be paid to the statute of limitations, and it is recommended to assert claims promptly after discovering the problem. Eighthly, if late delivery and quality defects coexist, evidence of the quality problems should be fixed before rescinding the contract. Ninthly, the differences in rules between pre-sale and actual sale need to be evaluated separately, and specific reference can be made to the relevant provisions.Business and contract disputes in enterprisesThe analytical approach in the column.

VI. Frequently Asked Questions

Q1: How much compensation can be claimed for late delivery of the house?

It mainly depends on the provisions of the contract. If the contract stipulates the standard of the breach of contract penalty for late delivery of the house, it is usually calculated according to the standard and the actual number of days of delay, for example, by multiplying the standard of 0.01% per day by the number of days of delay. If there is no stipulation or the stipulation is unclear, the party can claim according to the actual losses, but needs to provide corresponding evidence. In addition, if the delay meets the contractual conditions for termination or constitutes a fundamental breach of contract, the party can claim to terminate the contract and demand the return of the house price and interest. The relevant calculation methods can be referred to for reference.Real estate transactions and construction projectsColumn.

Q2: The developer said it was an act of force majeure. Can they be exempted from liability?

It depends on whether it truly constitutes a force majeure. A force majeure requires an objective situation that is unforeseeable, unavoidable, and insurmountable, and the causal relationship with the delay in performance must be proven. In practice, common situations such as a broken capital chain, improper construction organization, delayed material supply, or poor management usually do not constitute a force majeure. Developers also have an obligation to notify and mitigate losses in a timely manner. If they fail to notify and take measures in a timely manner, their claim for exemption from liability may not be supported, so the content of the extension notice issued by them is an important subject of review.

Q3: How long after the check-out time can I check out of the hotel?

First, let's look at the contract provisions. Most pre-sale contracts stipulate that if the delay exceeds a certain number of days, the buyer can terminate the contract; if the breach of contract reaches the statutory or contractual level, the buyer can also claim to terminate the contract. Second, let's look at the project status: if the project has been stalled for a long time and there are no clear arrangements for resuming work, it is often more practical to terminate the contract and return the purchase price than to wait for the delivery of the house. The exercise of the right to terminate the contract is usually subject to time limits. The buyer should exercise the right to terminate the contract and notify the other party in a timely manner after knowing or should have known the grounds for termination. The procedural design should be judged item by item in accordance with the contract provisions.

Q4: How to handle the mortgage?

When terminating the purchase contract, it is usually necessary to deal with the mortgage loan at the same time. In practice, it is common to request the termination of both the purchase contract and the loan contract in the litigation, and to require the developer to return the purchase price and the principal and interest of the loan that have been paid, and to pay off the remaining loan. The relevant rules are clearly stipulated in the Judicial Interpretation of Disputes over Commercial Housing Sales Contracts. If the developer is only in a phase of default, it may be more practical to continue to perform the loan and retain the right to claim the breach of contract penalty, so as to avoid getting into a long-term dispute due to the complexity of the termination procedure.

Q5: Can I request an adjustment if the penalty for breach of contract is too high?

Yes. According to Article 585 of the Civil Code, if the agreed penalty for breach of contract is excessively higher than the losses caused, the people's court or arbitration institution may, at the request of the parties, reduce it appropriately. In practice, the reference factors usually include the fluctuation of housing prices, the level of rent, and the loss of capital occupation. It should be noted that claiming adjustment and claiming payment according to the contract are not contradictory. In the claim, you can simultaneously explain the actual losses and request an adjustment in the case of an obviously excessive penalty. The method of claiming can be referred to as follows:Special services and other casesColumn.

The above content is based on the judicial practice in the Beijing area. The facts of individual cases and the jurisdiction of the court may affect the conclusions. Welcome to consult Henglue Lawyers about specific situations.

If you are facing similar problems, it is recommended that you consult a professional lawyer as soon as possible with evidence materials, so as to avoid missing the statutory time limit. →Legal services for the purchase and sale of real estate·Attorney Tian Jiaoyan·Beijing Henglu 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.