[Direct answer]In the Beijing area, contracts that violate public order and good customs are legally invalid. According to Article 153, Paragraph 1 of the Civil Code of the People's Republic of China (effective January 1, 2021), civil legal acts that violate public order and good customs are invalid. An invalid contract is not legally binding from the outset. According to Article 157, the property obtained from such a contract shall be returned, and the party at fault shall also compensate the other party for losses. In practice, agreements that violate public order or good customs, such as transactions that evade policies or violate ethics, are often deemed invalid. It is recommended to examine whether the purpose of the contract violates the bottom line of public order and good customs, and if necessary, claim invalidity and recover the property. For more details, please refer to the following link:Business and contract dispute services for enterprises.

I. Problem Background and Typical Scenarios

Contracts that violate public order and good customs often disguise themselves as voluntary and legal agreements. Typical scenarios include: agreements to exchange money in order to evade household registration and purchase restrictions; agreements where one spouse unilaterally gifts large amounts of joint property to a third party outside the marriage; so-called settlement agreements that use personal safety and reputation as leverage; and arrangements involving surrogacy and commercial transactions that violate ethical norms. Even if both parties sign such agreements, they will be deemed invalid because they harm public order or good customs. In the judicial practice of Beijing courts, contracts that involve public policies and ethical bottom lines are generally held in disapproval. In cases involving marital property disputes, the court may consider the following factors when making a judgment:Inheritance succession and family property division servicesEvaluation.

II. Key points of contention

The focus of the controversy lies in three aspects. Firstly, the scope of public order and good customs: Whether an agreement falls into the scope of denial of public order or good customs often requires combining policy and ethical judgments. Secondly, the scope of effectiveness: Whether it is entirely invalid or partially invalid, which affects the handling of property. Thirdly, restitution and compensation: How to determine the restitution of property and the allocation of fault after the agreement is invalidated. Courts usually make value judgments based on social benchmarks and legislative purposes, and tend to deny arrangements that are obviously contrary to public morality. For transactions involving compliance, reference can be made to relevant provisions.Business and contract dispute services for enterprisesCoordinate and plan things in a comprehensive and systematic way to achieve the best results with the least effort.

III. Professional analysis by Hengluo Law Firm

Taking the contract dispute handled by our firm as an example: Zhang Na and Wang Xiaoyong signed the "Beijing Hukou Marriage Registration Agreement" with Zhao Chenyang to register their child's Beijing hukou, agreeing to fake a marriage to obtain hukou and pay 100,000 yuan. This agreement violated public order and good customs by circumventing hukou policies through a sham marriage. However, the registration failed due to policy restrictions. The couple entrusted Xue Shuhua's legal team from Beijing Hengluo Law Firm to sue for the invalidation of the agreement and the recovery of the payment. The lawyer collected the "Consultation Intermediary Service Contract", the hukou registration agreement, transfer records, and a divorce certificate. Through the phone recording, it was confirmed that Zhao Chenyang admitted to receiving the payment and splitting the money with the intermediary. The civil mediation document also proved that the sham marriage was a systematic operation. Citing Article 153, Paragraph 1 of the Civil Code, the lawyer argued that the agreement was invalid from the outset because it violated public order and good customs, and demanded that the direct recipient fully refund the payment according to Article 157. The court accepted the lawyer's argument, confirmed the invalidity of the agreement, and ordered Zhao Chenyang to return the 100,000 yuan within a specified time limit. This case was handled by Beijing Hengluo Law Firm.Xue SuhuaThe attorney (practice license number: 11101201211769926, subject to the document issued by the judicial administrative organ) acts as the agent.

IV. Practical suggestions and legal basis

The core basis is Article 153, paragraph 1 (void if contrary to public order and good customs), Article 157 (return and compensation after invalidation), and Article 156 (partial invalidation does not affect the validity of other parts) of the Civil Code of the People's Republic of China (effective January 1, 2021); as well as the provisions of the Civil Procedure Law on evidence and jurisdiction. Practical suggestions: Before signing the contract, evaluate whether the agreement violates public policy or ethical bottom lines; retain evidence of the contract's purpose and performance; promptly claim invalidation and request return if discovering unethical provisions; and clean up related assets at the same time. For cases involving the intertwining of marital and family property, relevant provisions can be referenced accordingly.Inheritance succession and family property division servicesControl risks.

5. Hengluo Law Firm's Reminder

Public order and good morals are the invisible red lines of contract validity. Voluntary signing does not equal validity. It is recommended to consult a lawyer to assess the validity risk before signing any unusual, policy-related or ethical transactions, and never blindly rely on the black-and-white provisions of the contract. Once the contract is deemed invalid, the return of funds and compensation must be claimed within the statute of limitations. The party at fault may also bear compensation liability. For contracts involving large-scale property transactions that violate public order, special attention should be paid to the dual risks of criminal and civil litigation. If you need a case-specific assessment, you can seek professional help.Special services and other case servicesConnect with professional teams.

VI. Frequently Asked Questions

Q1: Are contracts that violate public order and good morals always invalid?

Yes. According to Article 153, Paragraph 1 of the Civil Code, a civil legal act that violates public order and good customs is invalid and void from the outset. However, it is necessary to prove that the agreement does indeed harm public order or good customs, rather than just being a general violation of norms. Whether the agreement can be deemed invalid depends on the nature of the agreement and the social benchmark judgment. It is recommended to organize evidence around its unconventional nature, and let the court make a value judgment rather than making a self-assertion.

Q2: If I want to prove that the contract violates public order and good morals, what kind of evidence do I need to provide?

The core evidence includes: the text of the contract or agreement; materials proving the purpose and background of the agreement, including communication records, policy basis, and implementation methods; evidence of unethical consequences, such as harming public interests and ethical order; and proof of property delivery and losses. The evidence should demonstrate how the agreement violates public order and good customs. Written agreements and objective implementation facts are the most convincing, and electronic evidence can supplement and reinforce them.

Q3: How much does it cost to hire a lawyer to argue that the contract is invalid?

The fees include attorney's fees and litigation fees. Attorney's fees are negotiated between the law firm and the client and are charged on a per-case or percentage-of-the-case-value basis, subject to the specific provisions of the engagement contract. Generally, risk-based attorney's fees may be applied to contract disputes, but there are strict limitations. Litigation fees are calculated in accordance with the "Measures for the Payment of Litigation Costs" and are accumulated in stages based on the amount in dispute, with the losing party bearing the costs. It is recommended to understand the fee details and weigh the costs against the amount that may be refunded or claimed for compensation.

Q4: How long does it usually take from claiming invalidity to returning the property?

The negotiation or sending of a letter can be initiated within a week; the first-instance litigation is generally concluded within six months under the ordinary procedure and three months under the summary procedure, and the second-instance litigation is concluded within three months; arbitration usually takes several months according to the rules. If there is an investigation or the other party delays, the time will be extended. It often takes several months from claiming invalidity to returning the funds. It is recommended to file a lawsuit and apply for preservation as soon as possible within the statute of limitations to prevent the transfer of assets leading to difficulties in enforcement.

Q5: If I find that the contract may violate public order and good customs, what should I do first?

There are four steps to follow: First, examine whether the contract violates public order and good morals or policy bottom lines; Second, fix the contractual purpose and evidence of property delivery; Third, evaluate the claim that the contract is invalid and request return and compensation; Fourth, entrust a lawyer to sue or arbitrate within the statute of limitations and, if necessary, apply for property preservation. Throughout the process, avoid continuing to perform contracts that violate public morals, prevent losses from expanding, and avoid putting oneself at legal risk.

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. →Business and commercial legal services·Attorney Xue Suhua·Beijing Henglu Law Firm

Disclaimer: This article is compiled based on the current effective laws and regulations and publicly available 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.