[Direct answer]In the Beijing area, there are two types of applications for property preservation after a contract breach: preservation during litigation and pre-litigation preservation. According to Article 103 of the Civil Procedure Law of the People's Republic of China (amended on September 1, 2023 and effective from January 1, 2024), if the situation is urgent during litigation and failure to preserve the property will make the judgment difficult to enforce or cause other damages, the party may apply for preservation of the other party's property; according to Article 104, if the interested party suffers irreparable damage to their legitimate rights and interests due to the urgency of the situation and fails to apply for preservation immediately, they may apply to the court for pre-litigation preservation before filing a lawsuit or arbitration. However, they must file a lawsuit or apply for arbitration within 30 days after the court takes preservation measures, otherwise the preservation will be lifted. When applying for preservation, the applicant needs to submit a preservation application and property clues. If the court orders the applicant to provide a guarantee, they must do so. Preservation can freeze accounts and seize real estate, which is a key means to prevent the other party from transferring assets.

1. Problem background and typical scenarios

These types of needs are commonly encountered in several situations: First, when payments or contractual fees are long overdue and the funds in the other party's account continue to flow out; Second, when the other party delays payment after completing outsourced production or technical services, and there are signs of transferring assets; Third, when one party "disappears" during the lease or customized renovation of a store, and the losses need to be quickly identified. Relevant disputes can be referred to for reference.Real estate transactions and construction projects1. The first point is that the other party is involved in multiple lawsuits, and their assets may be seized by other creditors at any time. 2. The second point is that the arbitration case requires controlling the other party's assets before the ruling. 3. The third point is that the other party's assets may be transferred quickly after a breach of contract, and timely preservation often determines whether the actual recovery of funds is possible. 4. The fourth point is that the other party is involved in multiple lawsuits, and their assets may be seized by other creditors at any time. 5. The fifth point is that in the arbitration case, it is necessary to control the other party's assets before the ruling. Beijing is a densely populated area for commercial entities. After a breach of contract, assets can be transferred quickly, and timely preservation often determines whether the actual recovery of funds is possible. For reference only.Business and contract disputes in enterprisesColumn.

II. Key points of contention

First, the method of providing preservation guarantees. If the court orders guarantees, they can be provided in the form of cash, property mortgages, or insurance company's preservation liability insurance guarantees. Second, the clarity of the clues to the preserved assets, such as accounts, real estate, and vehicles, should be as specific as possible. Third, the grasp of the 30-day filing period after pre-litigation preservation. Preservation will be automatically lifted if the filing period is exceeded. Fourth, the liability for erroneous preservation. Those who apply for preservation incorrectly and cause losses to the other party shall be liable for compensation. Fifth, the scope of preservation shall be limited to the amount requested and shall not be obviously excessive. Sixth, pre-arbitration preservation must be submitted through the court, and the specific connection shall be subject to the current effective laws and regulations and judicial rulings. For the recovery of funds after preservation, reference can be made to the relevant provisions.Creditor's rights and debts, and enforcement casesColumn.

III. Professional analysis by Henglue Law Firm

Taking an arbitration case of a commissioned creation contract dispute handled by our firm as an example, we can see the actual effect of the system's efforts to recover compensation after a breach of contract. On May 12, 2022, Shanghai A Technology Company and Shenzhen B Network Company signed a "Project Outsourcing Agreement", which stipulated that A Company would complete the production of the first episode of the G Virtual IP material upgrade, with a total cost of 583,000 yuan (including tax). After a 50% advance payment, the project would commence and the duration would be approximately six weeks. A Company finalized the version on July 16, 2022, and the work was accepted on July 20, 2022. However, B Company delayed paying the remaining 50% of the contract amount. A Company entrusted a lawyer to apply for arbitration, requesting that the agreement be terminated on October 25, 2022, and that B Company pay the contract amount of 583,000 yuan, the breach of contract penalty of 116,600 yuan, and bear the lawyer's fees and arbitration fees. B Company argued that the delayed delivery of the work and the unsatisfactory quality constituted a fundamental breach of contract, and therefore had the right to refuse to pay. The arbitration tribunal found that each step of the work had been gradually confirmed by the respondent, the employees had voluntarily finalized the version and promised to pay the full amount, and the acceptance of the work met the written requirements. The tribunal adopted the applicant's main arguments and ruled that B Company should pay the contract amount of 583,000 yuan and compensate for all lawyer's fees. The arbitration fees of 30,366 yuan would be borne by B Company, with 25,366 yuan to be paid by B Company. This case shows that in the process of recovering compensation for breach of contract, it is equally important to clarify the contract terms, fix the evidence of acceptance, and formulate the request strategy. The connection between preservation, arbitration, and enforcement determines the efficiency of recovering payments. This case was handled by Beijing Henglu Law Firm.Xiong BinrongThe attorney (practice license number: 11101202211410897, subject to the document issued by the judicial administrative organ) acts as the agent.

IV. Practical suggestions and legal basis

Action recommendations: 1. First, gather information about the other party's assets, including bank accounts, real estate, vehicles, and equity stakes. The more specific the information, the faster the preservation process will proceed. 2. Pre-litigation preservation is intended for urgent situations. After obtaining a preservation order, you must file a lawsuit or initiate arbitration within 30 days. 3. When the court orders guarantees, you may prioritize preservation liability insurance bonds, which are more cost-effective than cash guarantees. 4. Ensure that the amount of the preservation order matches the amount of the litigation claim to avoid disputes over excessive compensation. 5. Coordinate preservation with litigation, arbitration, and enforcement to prevent disconnects between different stages. Legal basis: - Articles 103 and 104 of the Civil Procedure Law of the People's Republic of China (amended on September 1, 2023 and effective from January 1, 2024) specify the conditions for in-court and pre-litigation preservation, guarantees, and the 30-day filing deadline. - The Methods for Payment of Litigation Fees (effective since April 1, 2007) set the fee standards for property preservation applications. - Article 577 of the Civil Code of the People's Republic of China governs breach of contract liability. For guidance on preparing preservation documents and evidence lists, please refer to the relevant provisions.Special services and other casesColumn.

5. Henglue Law Firm's Reminder

Risk Warning: First, if you detect signs of the other party transferring assets (such as sudden changes in legal representatives, bulk payments to external parties, or abnormal account activities), you should take immediate action. Delaying may result in no assets left to preserve. Second, the 30-day time limit for pre-litigation preservation is a strict requirement. If you fail to file a lawsuit within the time limit, the preservation order may be lifted, and you may also be liable for compensation. Third, if you mistakenly preserve the other party's undisputed assets, you will need to compensate for the losses in accordance with the law. Before applying for preservation, you should carefully verify the clues. Fourth, preservation is just a means. Ultimately, recovering the money still requires a successful judgment and enforcement. It is recommended that you consult a lawyer as soon as possible to evaluate the timing of preservation and the guarantee plan. You can pay attention to it.Beijing Henglu Law FirmThe same category on the official website.

VI. Frequently Asked Questions

Q1: Can applying for property preservation help recover the money?

Security measures themselves do not generate payment obligations, but they can freeze and seize the other party's assets to prevent there being no assets to enforce after the judgment or ruling takes effect, greatly increasing the actual recovery rate. If there are indeed funds in the other party's account or there are properties under their name that can be disposed of, the secured assets can be disposed of and recovered upon the effectiveness of the legal document; if the other party is already heavily indebted, the order of priority of the security measures will also affect the chances of repayment. Whether the recovery can be achieved depends on the other party's asset situation and the timing of the security measures. It is recommended to apply for them immediately if there are signs of asset transfer.

Q2: What materials are required to apply for preservation of evidence?

The main documents include: a preservation application, stating the requested amount, the factual reasons, and the clues to the property; a list of property clues, such as bank account numbers, property locations, vehicle license plates, and equity information; guarantee materials, such as cash, collateral, or insurance company's preservation liability insurance guarantees; and materials related to litigation or arbitration, such as contracts and evidence of breach of contract. Pre-litigation preservation also requires evidence and explanations demonstrating the urgency of the situation and that failure to preserve the property would cause irreparable harm. The more specific the materials are, the faster the court will review them.

Q3: How much does it cost to obtain property preservation orders?

The preservation costs include application fees and guarantee costs. According to the "Measures for the Payment of Litigation Costs", the application fees for property preservation are charged in stages based on the amount of the preservation, with an upper limit; if the guarantee step uses an insurance company's preservation liability insurance guarantee letter, the premium is usually a certain percentage of the preservation amount, which is much lower than the full cash guarantee. After winning the case, some preservation costs may be borne by the other party or shared proportionally. The specific expenses should be budgeted based on the preservation amount and the guarantee method. It is recommended to consult first before taking action.

Q4: How long will it take to freeze the other party's assets after applying for preservation of evidence?

In the case of urgent pre-litigation preservation with complete materials, the court generally makes a ruling and takes measures within 48 hours; for in-litigation preservation, the court usually makes a ruling within five days, and the preservation measures are implemented immediately after the ruling, such as sealing up and freezing the assets. The actual speed depends on the clarity of the property clues and the implementation of the guarantee. After obtaining the pre-litigation preservation ruling, the plaintiff must file a lawsuit or apply for arbitration within 30 days, otherwise the preservation measures will be lifted.

Q5: How should preservation of evidence and litigation be arranged after a breach of contract?

The first step is to collect evidence of the breach of contract and clues to the other party's assets; the second step is to assess the urgency of the situation. If the other party is transferring assets, you can apply for pre-litigation preservation first; the third step is to complete the litigation or arbitration filing within 30 days after the preservation, and you can submit the preservation application together with the litigation case; the fourth step is to cooperate with the court to complete the guarantee and enforcement of the ruling; the fifth step is to apply for compulsory enforcement promptly after winning the lawsuit to dispose of the preserved assets. The overall process can be referred to for reference.Business and contract disputes in enterprisesColumn.

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. →Corporate commercial legal services·Attorney Xiong Binrong·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. In case of disputes, please consult a practicing lawyer in time.