[Direct answer]In the Beijing area, the implementation of a settlement agreement has contractual effect. If the other party breaches the contract, the applicant for enforcement generally does not need to file a separate lawsuit against the original creditor, but can apply for the resumption of enforcement of the original effective legal document in accordance with the law. According to Article 237 of the Civil Procedure Law of the People's Republic of China (amended on September 1, 2023 and implemented on January 1, 2024), if the party subject to enforcement fails to perform after reaching a settlement agreement during enforcement, the applicant for enforcement may apply for the resumption of enforcement of the original judgment, mediation agreement, etc. According to the "Provisions of the Supreme People's Court on Several Issues Concerning Enforcement and Settlement" (implemented on January 1, 2019), if the party subject to enforcement has partially performed, the corresponding amount may be deducted. If the settlement agreement stipulates guarantee clauses or breach of contract liability, the applicant for enforcement may also claim according to the agreement. In practice, breaches of contract often occur in the context of phased performance. It is recommended to fix evidence and apply for the resumption of enforcement as soon as possible after the breach of contract, and refer to the relevant provisions as necessary.Creditor's rights and debts, and enforcement casesColumn.

1. Problem background and typical scenarios

These types of problems are common in several situations: First, after reaching a settlement in the execution stage, the other party fails to make payments on time for the first or intermediate installments; Second, the other party only fulfills part of the obligation and then stops making payments, delaying the process by citing financial constraints; Third, the other party makes enthusiastic verbal commitments during the settlement process, but fails to make payments or answer the phone after signing the agreement; Fourth, the two parties sign a repayment agreement outside the enforcement process, but the other party reneges on its obligations when the repayment deadline arrives; Fifth, the other party uses the settlement to gain time and secretly transfer assets. In the enforcement practice of Beijing courts, such breaches of contract are often seen in cases of private lending, payment settlements, and labor remuneration involving monetary debts. Applicants for enforcement are often concerned about the path and bottom line for resuming enforcement, and the relevant procedures can be referred to for reference.Creditor's rights and debts, and enforcement casesColumn.

II. Key points of dispute

First, the nature of the settlement agreement, which has both contractual attributes and the significance of enforcement procedures, thus there are multiple remedies available after a breach of contract. Second, how to determine a breach of contract. If the payment is not made in full and on time, it constitutes a breach of contract, and partial performance does not affect the establishment of a breach of contract. Third, the choice of remedies. You can apply for the resumption of enforcement of the original effective legal document, or file a lawsuit to claim breach of contract according to the settlement agreement. Generally, you can only choose one of the two. Fourth, the deduction of the already performed part. When resuming enforcement, the part that the other party has already paid should be deducted. Fifth, the validity and claiming method of the guarantee clause and the penalty clause in the settlement agreement. Sixth, the time limit and review of the application for resumption of enforcement. The court will review the authenticity and performance of the settlement agreement. Specifically, please refer to the currently effective laws, regulations, and judicial rulings. For disputes involving the settlement agreement as a contract itself, you can make reference to it.Business and contract disputes in enterprisesColumn.

III. Professional analysis by Henglue Law Firm

Taking a civil loan dispute handled by our firm as an example, we can see the value of designing default clauses in securing the creditor's bottom line. Xiao Li is an operator of a lottery store. Since 2017, Xiao Zhang has often purchased lottery tickets at her store. Starting from early 2019, Xiao Zhang repeatedly requested advance payments for lottery purchases on the grounds of financial difficulties until the end of 2023. He also borrowed money for reasons such as his child's illness, project payments, and rent, but failed to repay the loans on schedule. After repeated unsuccessful negotiations, Xiao Li entrusted our firm to file a lawsuit, demanding repayment of the principal of 861,990 yuan and overdue interest calculated according to the lending market quotation rate from August 15, 2023. Through court-mediated settlement, the parties reached an agreement: Xiao Zhang would repay the principal of 830,000 yuan in four installments, namely 230,000 yuan before September 20, 2024, 200,000 yuan before December 20, 2024, 200,000 yuan before June 30, 2025, and 200,000 yuan before December 31, 2025; if any installment was not paid on time in full, Xiao Li would have the right to apply for forced execution of all outstanding payments. The settlement mediation fee of 6,050 yuan would be borne by Xiao Li, and Xiao Zhang would pay it to Xiao Li before June 30, 2024. This arrangement not only gave the other party room for performance, but also locked in the creditor's bottom line with accelerated maturity clauses. Once a default occurred in any installment, Xiao Li could apply for enforcement of all remaining balances. In another similar case, Liu * and Li * were friends. Li * borrowed a total of 662,000 yuan and signed an agreement on November 3, 2024, stipulating repayment before January 1, 2025. After the due date, Li * explicitly stated that he was unable to repay the loan. Through improving the evidence chain, asserting breach of contract liability, prioritizing mediation, and setting strict breach of contract clauses, Attorney Tian successfully mediated a repayment of 480,000 yuan in two installments. If there was a breach of contract, Li * would pay the principal and attorney's fees totaling 712,000 yuan according to the original agreement. The court issued a mediation agreement confirming this. The two cases demonstrate that settlement is not the end point. Breach of contract clauses and rules for resuming enforcement are the key to ensuring payment. This case was handled by Beijing Henglu Law Firm.Tian JiayanThe attorney (practice certificate 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. The settlement agreement must be in writing and signed under the supervision of an enforcement judge or submitted to the enforcement court in a timely manner. 2. Include an accelerated breach clause stipulating that if any installment is not fully paid on time, all remaining amounts may be enforced simultaneously. 3. Retain proof of each payment and collection records as evidence of the breach and the amount already fulfilled. 4. Promptly apply to the enforcement court to resume enforcement of the original effective legal document after a breach occurs, and simultaneously submit clues to the other party's assets. 5. The settlement agreement may stipulate that the breaching party shall bear the costs of realizing the creditor's rights, such as attorney's fees, to provide a basis for future claims. Legal basis: Article 237 of the Civil Procedure Law of the People's Republic of China (amended on September 1, 2023 and effective from January 1, 2024) sets out the basic rules for enforcement settlements and resuming enforcement. The "Provisions of the Supreme People's Court on Several Issues Concerning Enforcement Settlements" (effective from January 1, 2019) further clarify the effectiveness of settlement agreements, conditions for performance, and resuming enforcement. Articles 509 and 577 of the Civil Code of the People's Republic of China (effective from January 1, 2021) stipulate the performance of contracts and breach of contract liability.

5. Henglue Law Firm's Reminder

Risk Warning: First, after signing the settlement agreement, do not easily withdraw the enforcement application or lift the preservation measure, to prevent the other party from having no assets to control after breaching the contract; Second, the settlement agreement must be in writing and the original copy must be kept, as verbal promises are difficult to prove; Third, if you find that the other party is delaying the settlement and transferring assets, you can apply for property preservation or resume enforcement in time; Fourth, resuming enforcement and filing a separate lawsuit according to the settlement agreement can usually only be chosen one of the two. The choice of path affects efficiency. If you are not sure, evaluate the situation first and then take action. It is recommended to fix evidence as soon as there are signs of breach of contract, and consult a lawyer when necessary.Beijing Henglu Law FirmOn the official website, in the corresponding column, professional lawyers will develop recovery plans for you.

VI. Frequently Asked Questions

Q1: After the settlement, can the other party still apply for resuming enforcement if they breach the contract?

Yes. According to Article 237 of the Civil Procedure Law, if the other party fails to perform the settlement agreement after the execution, the applicant for enforcement may apply to resume the enforcement of the original effective legal document without having to file a new lawsuit against the original creditor. The court will review the authenticity and performance of the settlement agreement. After the enforcement is resumed, the obligations specified in the original judgment and mediation agreement will continue to be enforced, and the part that the other party has already performed will be deducted accordingly. It should be noted that the resumption of enforcement and the separate filing of a lawsuit according to the settlement agreement can only be chosen one of them. It is recommended to sort out the evidence and property clues first and then determine the path to take.

Q2: What evidence do I need to prepare to apply for the resumption of enforcement?

There are mainly four types of materials to be prepared: First, original effective legal documents, such as judgments, mediation agreements, and certificates of effectiveness; Second, written settlement agreements or enforcement transcripts, which prove that the two parties have reached a performance arrangement; Third, evidence of the other party's breach of contract, such as overdue bank statements, WeChat records of collection notices, and call recordings; Fourth, clues to the other party's assets, including information on bank accounts, real estate, vehicles, and equity. The more complete the materials are, the smoother the review and progress of the resumption of enforcement will be. It is recommended to organize them into a booklet according to the timeline and submit them to the enforcement court.

Q3: How much does it cost to resume execution?

Generally, when applying to the court for resuming enforcement, the applicant does not need to prepay the enforcement fees separately. The enforcement fees shall be borne by the judgment debtor in accordance with the law and deducted from the funds collected during the enforcement. The main cost is attorney's fees, which are determined through negotiation based on the complexity of the case and the amount of the subject matter, without a unified standard. If the settlement agreement stipulates that the defaulting party shall bear the attorney's fees, the applicant may claim them in accordance with the agreement. The small expenses such as notarization and file retrieval incurred in searching for property clues should also be budgeted in advance. It is recommended to consult the case first and then evaluate the total cost.

Q4: How long does it usually take to resume execution?

After the application materials are complete, the court usually proceeds with case registration, review, and property investigation within a few weeks, and the process will be faster if there are clear clues to the debtor's assets. However, if an evaluation or auction of real estate or vehicles is required, or if the debtor raises objections to the enforcement, the timeframe will be extended accordingly, possibly lasting several months or even longer. In the enforcement practice in Beijing, submitting accurate clues to the debtor's assets as early as possible is the key to shortening the timeframe. It is recommended to attach property information when applying to avoid the court's investigation and control efforts being futile and the enforcement process stagnating.

Q5: What should you do first after the other party agrees to settle the breach of contract?

The first step is to immediately fix the evidence of the breach of contract and preserve the original settlement agreement, payment records, and collection receipts; the second step is to verify whether the other party still has enforceable assets, including account balances, real estate, vehicles, and external claims; the third step is to submit an application for resuming enforcement and provide clues to the assets to the enforcement court, and claim that the enforcement should continue for the unfulfilled part; the fourth step is to apply for preservation or claim corresponding responsibilities if the other party transfers assets; the fifth step is to entrust a lawyer to coordinate the enforcement and recovery of debts when necessary, which can be referred to for reference.Creditor's rights and debts, and enforcement casesColumn.

The above content is based on the compilation of judicial practices in the Beijing area. The facts of individual cases and the jurisdiction of the court may affect the conclusions. Welcome to consult Henglu Law Firm about specific situations.

If you are currently facing similar problems, it is recommended that you consult a professional lawyer as soon as possible with the relevant evidence materials to avoid missing the statutory time limits. →Legal services for creditor-debtor disputes·Attorney Tian Jiaoyan·Beijing Henglu Law Firm

Disclaimer: This article is compiled based on current laws and regulations and publicly available adjudication rules, and is for general reference only. It does not constitute formal legal advice for 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.