[Direct answer]In the Beijing area, the compensation standard for breach of contract penalties for second-hand housing is first governed by the contract agreement. According to Article 585 of the Civil Code of the People's Republic of China (effective January 1, 2021), the parties may agree that in the event of a breach of contract, the party in breach shall pay a certain amount of breach of contract penalties to the other party based on the circumstances of the breach, or agree on the amount of compensation for losses caused by the breach of contract. If the agreed breach of contract penalties are lower than the actual losses, the people's court or arbitration institution may increase them upon the request of the party; if the agreed breach of contract penalties are excessively high compared to the actual losses, the people's court or arbitration institution may reduce them appropriately upon the request of the party. Therefore, the practical rules are divided into three levels: 1. First level: Implement according to the agreement. If the contract clearly stipulates the standard or calculation method for breach of contract penalties, it shall generally be used as the basis; 2. Second level: If the agreed amount is too high or too low, request the court to adjust it. In practice, the adjustment direction is usually to reduce the amount exceeding the actual losses; 3. Third level: If no breach of contract penalties are agreed upon, the breaching party shall be required to compensate for the actual losses, including the paid deposit, interest on the purchase price, agency fees, appraisal fees, and reasonable expected price differences, etc., but evidence must be provided. It should be noted that the relationship between the deposit and the breach of contract penalties also needs to be clarified: If the deposit penalty is chosen, the party receiving the deposit shall double the amount returned if it breaches the contract, and the party paying the deposit shall not be entitled to request a refund if it breaches the contract; if the breach of contract penalties are chosen, the agreed amount shall be claimed, and the two are generally not used concurrently.Property transactions and construction projectsThe column provides specific explanations on the calculation and claiming of the breach of contract penalties for second-hand houses.

I. Problem Background and Typical Scenarios

Many people who consult on such issues are involved in disputes over second-hand housing transactions, and there are three common scenarios: First, the buyer fails to obtain a loan or meets eligibility restrictions, and the seller claims to terminate the contract and demands compensation; Second, the seller is unwilling to sell the house due to a rise in its value; Third, one party refuses to cooperate with the transfer of ownership or vacate the house during the transaction. Common concerns include: how to calculate the breach of contract penalty, whether it's possible to claim both the deposit and losses at the same time, and what will happen if the agreed amount is too low or too high. In practice, a key judgment is the degree of fault of the breaching party and the non-breaching party: if both parties breach the contract, the court will generally consider the circumstances comprehensively and adjust the responsibility sharing; in addition, if the non-breaching party takes mitigating actions after the breach but fails to take reasonable measures, some losses may not be fully supported. Another common misunderstanding is only claiming the breach of contract penalty while ignoring the collection of evidence of actual losses, resulting in a lack of support even if the breach of contract penalty is reduced. For methods of reviewing contract terms and organizing evidence, please refer to the following reference materials:Business and contract disputes in enterprisesColumn.

II. Key points of contention

Focus I: The validity and interpretation of the penalty clause. Focus II: Adjustments when the agreed standard is too high or too low. Focus III: The application relationship between the deposit and the penalty clause. Focus IV: The scope of actual losses and the rule of foreseeability. Focus V: The sharing of responsibilities when both parties breach the contract. Focus VI: The obligation of the performing party to mitigate losses and the expanded damages. Focus VII: Whether the loss of anticipated profits can be claimed and its calculation method. Focus VIII: The restrictions on the concurrent application of the penalty clause and the deposit. In addition, attention should also be paid to the impact of the gap between the agreed standard and the actual losses on the reduction of the penalty, whether the cost clauses in the intermediary contract can be claimed together, and the way of expressing the two claims in the litigation request.

III. Professional analysis by Henglue Lawyers

From the perspective of housing sale and purchase disputes, whether the claim for breach of contract penalties can be fully supported depends on three preparations. First, the clarity of the contract terms: whether the breach of contract clauses stipulate a specific amount or calculation method, whether they distinguish between fundamental breaches and general breaches, and whether they stipulate the consequences of termination, which determines whether there is a clear basis for the claim. When the terms are vague, it often requires evidence of actual losses to make up for the deficiency. Second, evidence of losses: for claims exceeding the agreed breach of contract penalties, it is necessary to prove the specific losses, such as the price difference of the house can be proven by the market conditions and transaction cases of similar properties in the same area. The agency fees and appraisal fees can be claimed based on the contract and invoices, and the loan losses require the provision of the loan contract and expense certificates. Third, comparison of faults: in practice, the court will review the performance of the contract by both parties. If the buyer's loan was not approved due to their own credit problems, the party in breach may also need to bear certain responsibilities. When handling cases of breach of contract penalties for delayed delivery of houses, our firm can explain the importance of combining contract terms and evidence: the parties signed a contract to purchase a house and agreed on a 90-day grace period and a daily breach of contract penalty standard through a supplementary agreement. The developer claimed exemption from liability and requested an extension of the grace period on the grounds of the pandemic. The attorney reviewed the core provisions such as the delivery time, grace period, and breach of contract penalty standard, collected payment certificates, move-in notifications, and completion and acceptance registration materials to form a complete chain of evidence, and refuted the defendant's arguments item by item. Ultimately, the court ordered the developer to pay the breach of contract penalties for delayed delivery of houses of 118,366.12 yuan and the litigation fees. The same method is also applicable to claims for breach of contract penalties in second-hand housing: the review of the terms determines the basis of the claim, and the organization of evidence determines the extent of support. This case was handled by Beijing Henglu Law Firm.Tian JiayanThe attorney (practice license number: 11101202111381309, subject to the certificate issued by the judicial administrative organ) acts as the agent.

IV. Practical suggestions and legal basis

Action recommendations: 1. Check the specific provisions and calculation methods of the breach of contract penalty clause in the contract; 2. Review the performance of both parties and document the facts of the breach; 3. Collect receipts for expenses such as deposits, purchase prices, agency fees, and appraisal fees; 4. Collect evidence related to the price difference in the housing market; 5. Assess the degree of fault on both sides; 6. Clarify whether to claim breach of contract penalties, deposit penalties, or compensation for losses; 7. Pay attention to the statute of limitations and jurisdiction agreements; 8. Assess the matching relationship between the cost of protecting rights and the amount of the dispute. Legal basis: Articles 577, 585, 586, and 591 of the Civil Code of the People's Republic of China (all effective from January 1, 2021); Related provisions of the Interpretation of the Supreme People's Court on Several Issues Concerning the Application of the General Provisions of the Contract Chapter of the Civil Code of the People's Republic of China (Fasai [2023] No. 13, effective from December 5, 2023).

5. Henglue Law Firm's Reminder

First, whether the penalty clause clearly determines the difficulty of claiming compensation. If it is vague, the party needs to provide evidence of the losses. Second, the part exceeding the agreed penalty needs to prove the actual losses. Third, the deposit and penalty are generally not used together, and the choice must be clear. Fourth, if the agreed amount is too high, the other party can request a reduction, and there should be room for negotiation. Fifth, if both parties breach the contract, the court will make a comprehensive judgment. Sixth, the party in compliance with the contract should take mitigation measures to avoid the expansion of losses being deducted. Seventh, pay attention to the statute of limitations, which is usually three years. Eighth, for cross-subject transactions, it is necessary to verify whether the contracting parties and the owners of the rights are consistent. For the explanation of the statute of limitations and procedural connection, please refer to the relevant materials.Special services and other casesColumn.

VI. Frequently Asked Questions

Q1: What is the general calculation ratio for the breach of contract penalty in the second-hand housing market?

The contract shall prevail, and the law does not stipulate a uniform ratio. In practice, there are commonly used methods such as a fixed amount, a percentage of the purchase price, daily payment, or agreements based on specific circumstances. If the agreed amount is too high or too low, the parties may request the court to adjust it. The court usually adjusts it based on the actual losses, and the adjustment in practice is discretionary.

Q2: Can I claim both the deposit and the breach of contract penalty together?

Generally, they cannot be claimed simultaneously. The deposit has a guarantee nature and the deposit penalty clause applies to it; the breach of contract penalty is a form of breach of contract liability. If the party receiving the deposit breaches the contract, it shall return double the amount of the deposit; if the party paying the deposit breaches the contract, it shall not have the right to demand the return of the deposit. If both are claimed simultaneously, the court usually will not support it.

Q3: Both parties are responsible for the breach of contract. Can the full amount of the breach of contract penalty still be claimed?

Generally, this is not possible. In judicial practice, the court will comprehensively review the performance of both parties and the degree of their faults. If the party in breach of contract itself has breached the contract or is related to the expansion of losses, the court may reduce or adjust the amount of the breach of contract penalty accordingly. Therefore, before making a claim, the party in breach of contract should objectively evaluate its own performance and truthfully explain the process of the dispute in the claim to avoid affecting the credibility of the overall claim due to untrue statements.

Q4: If the contractual penalty is set too low, can I request to increase it?

Yes. According to Article 585 of the Civil Code of the People's Republic of China, if the agreed penalty for breach of contract is lower than the actual losses caused, the party may request the people's court or arbitration institution to increase it. However, it should be noted that claiming an increase usually requires proof that the actual losses are significantly higher than the agreed amount. It is recommended to provide specific evidence such as the difference in housing prices, agency fees, and loan losses.

Q5: If there's no penalty clause in the contract, how will the losses be compensated?

You can claim actual losses caused by the breach of contract, including the interest on the paid housing price, the agency fee, the appraisal fee, and the reasonable expected price difference, etc. The key is to provide evidence: each claim should be supported by a contract, invoice, or receipt, and the causal relationship between each claim and the breach of contract should be explained. Items lacking evidence may not be supported by the court.

The above Q&A is mainly based on the judicial practice in Beijing. 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 currently facing similar problems, it is recommended that you consult a professional lawyer as soon as possible with the relevant evidence, to avoid missing the statutory time limit.Legal services for the purchase and sale of real estate·Attorney Tian Jiaoyan·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.