[Direct answer]In the Beijing area, whether fees can be charged for unsuccessful entrusted matters depends on the nature of the entrustment and the agreement between the parties. If it is an intermediary contract and the contract has not been concluded, according to Article 964 of the Civil Code of the People's Republic of China, the intermediary cannot request payment of the fee, but can request the client to pay the necessary expenses incurred in the intermediary activities. If it is a general entrustment contract, the fees can be shared according to the degree of handling the matter and the fault; if it is agreed to be a risk-based agency, the risk-based fee usually cannot be charged if the agreed result is not achieved. It is recommended to specify the billing method, payment milestones, and refund conditions when signing the contract to avoid disputes afterwards. For more details, please refer toLegal services for creditor-debtor disputes and enforcement cases.

1. Problem background and typical scenarios

It is common for clients to refuse to pay fees when entrusted matters fail to be successfully handled in scenarios such as agency services, consulting, risk-based legal representation, and intermediary matchmaking. Typical cases include: clients refusing to pay all fees on the grounds that "the matter failed to be handled", while ignoring the necessary expenses that have already been incurred; intermediaries claiming full compensation even though the transaction has not been successfully completed; risk-based legal representation agreements stipulating "no fees if unsuccessful", but the entrusted party charging a "base fee" which leads to disputes; and when the entrusted matter is only partially completed, the parties may argue over the fee ratio. When handling similar cases in the Beijing area, courts typically first distinguish the nature of the entrustment (intermediary, entrustment, or service), and then review the contractual provisions and the extent of the matter's handling. The classification of relevant contracts can be combined with the following factors:Business and contract dispute resolution services for enterprisesJudgment.

II. Key points of contention

The focus of the dispute lies in three aspects. Firstly, the distinction of the nature of the agency: the intermediary is paid based on the premise of "facilitating the transaction", which is generally different from the rules of entrusted agency and risk-based agency. A wrong qualification of the nature of the agency will lead to opposite conclusions. Secondly, the boundary of necessary expenses: even if the intermediary fails to complete the transaction, there is no payment, but reasonable and necessary expenses can be claimed separately, which need to be supported by evidence. Thirdly, the restrictions on risk-based agency: the relevant regulations strictly limit the scope and proportion of risk-based agency, and the risk fee cannot be collected if the result is not achieved. For disputes involving refunds, reference can be made to the relevant provisions.Special services and other case servicesClarify.

III. Professional analysis by Hengluo Lawyers

Based on our practical observations in handling agency contracts and fee disputes, such disputes most often confuse the boundaries between "remuneration", "necessary expenses", and "risk-based agency fees". According to the relevant provisions of the Civil Code, if the agent fails to facilitate the conclusion of the contract, he/she shall not request remuneration, but may request payment for the necessary expenses incurred in the agency activities. For general agency contracts, the agent shall handle the matters in accordance with the instructions, and the fees and remuneration shall be determined according to the agreement and the completion of the matters. Risk-based agency fees are subject to the prerequisite of "achieving the agreed results", and are subject to restrictions on the scope of application and the maximum percentage. In practice, Hengluo Lawyers usually suggest the following: Clearly specify the billing method, payment milestones, and refund conditions when signing the contract; for the structure of "basic fees + risk fees", it is necessary to clarify the respective triggering conditions; during the performance of the contract, retain the proof of expenditure and handling records to avoid the dilemma of being fully refused payment or fully pursued for recovery when the transaction fails. For refund litigation, it can be followed up accordingly.Creditor-debtor relations and enforcement case servicesAdvance.

IV. Practical suggestions and legal basis

The legal basis is Articles 919 to 936 of the Civil Code of the People's Republic of China (effective January 1, 2021) (definition of the agency contract, fees and remuneration, consequences of termination), Articles 963 and 964 (intermediary remuneration and necessary expenses); as well as relevant provisions on the fees for lawyer services and restrictions on contingency fees. Practical suggestions: Clearly define the nature of the agency in the contract, the billing method (fixed fee/proportional fee/contingency fee), payment milestones and refund conditions; distinguish and retain necessary expense receipts; strictly adhere to the scope of application and percentage limits for contingency fees; confirm the progress of case handling in writing during performance; and organize evidence around the agreement and the degree of handling after disputes arise, and resolve them by sending letters or litigation if necessary.

5. Henglu Law Firm's Advice

If the entrusted task is not completed, it does not mean that "it's a waste of effort and the intermediary shouldn't charge a fee", nor does it mean that "the intermediary should refund all the fees received". The key lies in the nature of the task and the contractual agreement. If the intermediary fails to complete the task, the intermediary can claim necessary expenses but not the remuneration; generally, the fees charged by the intermediary are shared according to the degree of handling; if the risk-based fee arrangement fails to achieve the expected result, the risk fee is usually not collected. When signing the contract, it is necessary to specify the charging and refund terms to avoid verbal ambiguity; during the performance of the contract, keep records of expenses and handling processes. If there are doubts about the legality of the fees charged or the refund, it is recommended to consult a professional lawyer as soon as possible and assert rights based on the contractual agreement and the actual degree of handling. For reference, please refer to the following materials:Beijing Henglu Law FirmFor further support, please visit our official website.

VI. Frequently Asked Questions

Q1: If the entrusted matter fails to be handled successfully, can the other party still charge me money, and will I lose the case?

It's not a simple matter of "being able to collect" or "not being able to collect", but depends on the nature of the commission and the agreement. If the intermediary fails to facilitate the conclusion of the contract, he/she may not request compensation but may claim necessary expenses; the general commission is based on the degree of case handling and the sharing of fault; if the risk agency fails to achieve the agreed result, the risk fee is usually not calculated. If the other party claims without basis or violates the restrictions of the risk agency, you can refuse to pay and it's likely that you will gain support; if there are indeed necessary expenses, you may need to share a reasonable portion. It is recommended to first check the nature and terms of the contract and then evaluate it, and never believe in unrealistic promises of victory.

Q2: For disputes over agency fees, what evidence do I need to prepare?

The core evidence includes: the entrustment contract or agreement (stating the nature, billing method, payment milestones, and refund conditions), proof of payment (for the paid portion), records of the entrusted party's handling of affairs and expense invoices (proving the authenticity of necessary expenses), records of communication and progress confirmation, as well as the identities of both parties and property clues. The evidence should be organized around "the nature of the agreement—whether it was successfully implemented—and whether the expenses are reasonable and necessary." The more complete the materials are, the more solid the defense against payment refusal or the claim for necessary expenses will be.

Q3: How much do lawyers' fees and litigation costs amount to in such disputes over commission fees?

The litigation fees shall be calculated in accordance with the "Measures for the Payment of Litigation Fees", based on the amount of the litigation request (the claimed fees or the amount of the refund), and shall be borne by the losing party. The attorney's fees are related to the complexity of the case, the amount of the subject matter, and the attorney's qualifications. They may be calculated on a per-case basis, as a percentage of the subject matter, or on an hourly basis. The specific fees shall be determined by the contract of engagement, and there is no unified government pricing. It is recommended to calculate the amount of the dispute before suing, compare it with the litigation fees and attorney's fees to assess the cost-benefit ratio, and make rational choices regarding the parts that are obviously unfounded to avoid the situation that small-scale disputes become uneconomical due to high costs.

Q4: How long does it usually take to resolve a dispute over commission fees?

The first-instance ordinary procedure shall be concluded within six months and the simplified procedure within three months. Where the facts are clear, the simplified procedure may be applied; if the defendant's whereabouts are unknown and the service needs to be announced, the time period will be extended. If an appeal is filed, the second-instance procedure generally takes three months. After the judgment takes effect, the enforcement process begins, and the time for recovering the payment depends on the defendant's financial status. Overall, simple cases often take several months from filing the lawsuit to recovering the payment. It is recommended to fix the evidence and initiate the process as soon as possible to avoid the loss of records or the defendant transferring assets.

Q5: When signing the power of attorney, how can I specifically avoid disputes over refunds?

It is recommended to proceed in four steps: First, clarify the nature of the commission (intermediary, general commission, or risk-based commission), as different natures have different charging rules; Second, specify the billing method, payment milestones, and refund conditions in writing, especially the structure of "base fee + risk fee" should clearly state the respective triggering conditions; Third, require the trustee to separately list and retain receipts for necessary expenses to prevent confusion afterwards; Fourth, confirm the progress and results of the transaction in writing during the performance, and negotiate or litigate based on the agreed terms and actual processing level when disputes arise. Maintain all communication and documents throughout the process, and consult a lawyer as soon as possible if there are questions about the legality of the fees.

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 Hengluo Law Firm for specific situations.

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. →Legal services for creditor-debtor disputes·Beijing Hengluo 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.