[Direct answer]If the seller breaches the contract and refuses to sell, the buyer has two main options: First, they can request the seller to assist in handling the transfer of ownership and pay the late breach of contract penalty, provided that there are no obstacles such as seizure or mortgage on the house, the buyer has the qualification to purchase the house, and is able to pay the balance; Second, they can rescind the contract, claim the return of the paid amount, the penalty for the deposit, or the breach of contract penalty, and claim compensation for the loss of the price difference of the house. According to Articles 577 and 584 of the Civil Code, the scope of compensation includes the benefits that could be obtained after the performance of the contract. Before suing, the buyer should first send a written notice to fix the evidence of the breach of contract and check the ownership status of the house. Beijing Henglu Law FirmReal estate sales and purchase contract team可评估路径，详见Beijing Henglue Law Firm.

I. Legal basis and interpretation of provisions

1. Article 577 of the Civil Code of the People's Republic of China (effective January 1, 2021)

When a party fails to perform its contractual obligations or performs them in a manner inconsistent with the contract, it shall bear contractual liabilities such as continuing to perform the contract, taking remedial measures, or compensating for losses. The seller's "refusal to sell" constitutes a typical refusal to perform the contract. The buyer may require the seller to continue to perform the obligation of transferring ownership, or may rescind the contract and seek monetary relief instead. When choosing a path, it is necessary to evaluate the current status of the house: if the house has been mortgaged, sealed up, or transferred to another buyer, it will often be difficult to enforce the obligation of continuing to perform the contract. In this case, rescinding the contract and seeking compensation may be more efficient. The choice directly affects the litigation strategy and preservation measures.

2. Article 584 of the Civil Code of the People's Republic of China (effective January 1, 2021)

The amount of compensation for losses shall be equivalent to the losses caused by the breach of contract, including the benefits that could be obtained after the performance of the contract, but shall not exceed the losses that the breaching party could foresee or should have foreseen at the time of concluding the contract. In the case of second-hand housing transactions, the loss of the housing price difference is the core of the recoverable benefits: when the seller breaches the contract, the buyer has the right to claim the part of the increase in the housing price; in practice, the price difference is usually determined by appraisal or the transaction price of similar houses in the same area. If the agreed breach of contract penalty is lower than the loss of the price difference, the buyer may also request an increase in compensation in accordance with Article 85 of the Civil Code.

3. The interpretation of the case by the judge

The court supports the common conditions for continued performance: the house is not sealed up, the mortgage has been lifted or can be lifted, and the buyer has sufficient qualifications and payment capacity to purchase the house; after the judgment assists in the transfer of ownership, the buyer can apply for compulsory execution. The assessment basis date for the loss of the price difference is usually determined between the time of the breach of contract and the time of the judgment. The buyer should apply for the assessment locking point in time. Common defenses of the seller, such as "the co-owner does not agree", "the change of the purchase restriction policy", and "the spouse's objection", generally do not constitute exemption grounds; but if the buyer himself does not have the qualifications to purchase the house or fails to make payments according to the contract, the responsibility will be redistributed. If the buyer maliciously sells the house to others and colludes with the seller, he can also claim the invalidity of the subsequent contract according to Article 154 of the Civil Code.

II. Henglue Law Firm's Real Cases (Detailed Review)

Review of the case:The lesson of sellers concealing major defects and refusing to perform their obligations truthfully in large-scale asset transactions is particularly relevant to corporate real estate transactions. In 2012, A Mining Technology Company responded to the local government's investment promotion and signed a "Tailings Storage Transfer Agreement" with the B Town Government, agreeing to acquire the mining rights to the tailings storage for the construction of a comprehensive utilization project for solid waste resources for 4.8 million yuan; A Company paid the transfer fee of 2 million yuan as agreed and invested more than 18 million yuan in building factories and purchasing equipment. After the project was launched, problems emerged one after another: the actual land area obtained was only 20.66 mu, which was inconsistent with the location of the factory; the tailings storage had been included in the reclamation project as early as 2010 and was verified as agricultural land in 2011, making it impossible to mine; in 2015, when the trial production was carried out, the B Town Government blocked it and even cut off the power supply, causing the project to come to a complete halt. In 2023, A Company entrusted Beijing Henglu Law Firm to handle the case.Wen Pinliang is a talented writer with outstanding literary achievements.The lawyer filed a lawsuit, demanding that the contract be declared invalid, the funds be recovered, and compensation be paid for the losses.

The focus of the controversy:First, did the B Town government conceal the fact that the tailings pond had been reclaimed, resulting in the agreement violating mandatory provisions and being invalid? Second, does the lawsuit filed in 2023 exceed the statute of limitations, and when does the statute of limitations start to run? Third, how should the huge investment losses be identified and compensated for?

Our position and that of the other party are as follows:Company A claimed that the other party concealed key facts and seriously breached the principle of good faith when signing the contract, and requested to confirm the invalidity of the contract, return the transfer payment, and compensate for the investment losses; the B Town Government argued that Company A should bear responsibility for withdrawing from the transfer of assets and failing to complete the mining and selection as agreed, and that the contract expired in 2015, so the lawsuit filed in 2023 exceeded the statute of limitations.

Attorney's Strategy and Legal Opinion:Attorney Wen Pinliang systematically argued that by applying for government information disclosure to retrieve the reclamation approval document issued by the Provincial Department of Land and Resources in 2010, it can be proven that the other party knew that the tailings pond was unminable at the time of signing the contract but still signed it; the agreement violates Article 8 of the Regulations on Land Reclamation, as mining would inevitably damage the reclaimed land and is therefore invalid due to its violation of mandatory provisions of laws and regulations; regarding the calculation of losses, the power outage caused the factory equipment to be idle and suffered losses of 8.19 million yuan, while the direct losses such as environmental impact assessment fees and reclamation coverage fees amounted to 287,000 yuan, totaling a claim of 8.477 million yuan; in terms of statute of limitations, after confirming the reclamation facts through information disclosure in 2023, the party only then realized that its rights had been infringed, and the statute of limitations should therefore be recalculated from that time.

The court's reasoning and case handling results:The court held that the agreement in question did not involve the transfer of mineral mining rights, and therefore the case was legally reclassified as a dispute over a sales contract. The agreement was found to be invalid for violating mandatory regulations on land reclamation, and the statute of limitations defense was not accepted. The court ordered the return of the transfer payment of 2 million yuan and interest. The normal operating expenses and unrelated fees in the investment losses were not supported, but the environmental impact assessment fees and tailings storage cover costs were supported. The main equipment, power facilities, and factory buildings in the plant area suffered losses, and the compensation was calculated based on the assessment value of 70% of the losses, amounting to 5,739,961.57 yuan, for a total compensation of 6,026,961.57 yuan and interest. From the filing of the lawsuit to the issuance of the judgment, the total amount of returns and compensation exceeded 8 million yuan. This case demonstrates that when the seller conceals defects in asset rights, the buyer can legally obtain both returns and compensation as remedies.

This case is handled by Beijing Henglu Law Firm.文品良Attorney (practice license number: 11101201910111365, subject to the document issued by the judicial administrative organ) acting as the agent.

III. Frequently Asked Questions

Q1: If the seller refuses to sell, can I request to proceed with the transfer of ownership?

Yes. Continuing performance is the first-ranked breach of contract liability listed in Article 577 of the Civil Code. If the house has not been sealed up, the mortgage can be removed, the buyer has the qualification to purchase the house and can pay the balance, the court may order the seller to assist in handling the transfer of ownership. If the seller fails to perform the obligation within the time limit, the buyer may apply for compulsory enforcement. However, if the house has been sold and transferred to a bona fide third party, it is objectively impossible to continue performance, and the buyer should proceed to rescind the contract and claim the difference in price. Before suing, it is necessary to check the status of real estate registration and sealing up to determine the strategy.

Q2: What items can be claimed when terminating the contract?

The main items include: the application of the penalty for the deposit, the corresponding remedies of double refund or confiscation of the party's deposit; the transaction fees such as the paid housing price and interest, and the loss of the house price difference. According to Article 584 of the Civil Code, the price difference is a recoverable benefit and should be compensated; if the agreed penalty is lower than the actual loss, the party may also request to increase it to a level equivalent to the loss according to Article 585. The price difference is generally determined by judicial appraisal, and when claiming it, attention should be paid to preserving the transaction records of the same area as evidence.

Q3: What evidence do I need to prepare?

The core chain of evidence includes: the sales contract and supplementary agreement, the intermediary contract, the payment vouchers for the deposit and the purchase price, the online signing and filing records, the WeChat messages, text messages, lawyers' letters and delivery records for urging performance, the results of the house ownership registration and the mortgage foreclosure inquiry, as well as evidence of the housing price trend in the same area. If the seller verbally reneges on the deal or delays the transfer process, it is best to fix it in writing or by audio recording. The more complete the evidence is, the higher the support for the claim for the price difference and the request for an increase in the breach of contract penalty will be.

Q4: How long does it take and how much does it cost to handle such lawsuits?

In terms of time limits, cases applying the simplified procedure shall be concluded within three months, and cases applying the ordinary procedure shall be concluded within six months. Cases involving appraisal and identification will be extended accordingly. Regarding fees, the case acceptance fee is calculated in stages according to the amount of the litigation subject, and those claiming compensation for price differences also need to prepay the appraisal fee. The attorney's fee shall be determined based on the scope of the entrustment and specified in the written contract. During the litigation, the applicant may apply for property preservation to prevent the seller from transferring the property or the purchase price. The preservation fee and the guarantee fee shall also be included in the budget.

Q5: What should I do if the seller has transferred the ownership of the house to someone else?

First, check the time of title transfer and the identity of the buyer: If the buyer knew that we were still colluding with the seller to transfer ownership during the previous transaction, he may claim that the contract is invalid due to malicious collusion to harm the interests of others according to Article 15 of the Civil Code, and recover the house or seek compensation; if the buyer acted in good faith, paid a reasonable consideration and transferred ownership, it will be difficult to recover the house, so we should terminate the contract as soon as possible and seek compensation for the price difference, interest and other losses. In any case, we should sue and apply for preservation as soon as possible to avoid the loss from being further aggravated.

IV. Suggestions for Protecting Rights and Interests

  • It was found that the seller delayed sending a written notice to the buyer, clarifying the grace period and legal consequences. The record of the notice is a crucial piece of evidence for terminating the contract and making a claim.
  • Before filing a lawsuit, check the status of the house's seizure, mortgage, and ownership. Based on this, decide whether to continue with the performance of the contract or to pursue a claim for compensation.
  • During the period of fluctuating housing prices, it is necessary to apply for a price difference evaluation in a timely manner, save the transaction data of the same area, and lock in the benchmark point that is favorable to oneself.
  • Keep all the receipts for the deposit, the house price, taxes, and agency fees intact, and claim the interest and reasonable legal fees at the same time.
  • Before purchasing large-scale assets, verify the existence of any rights defects or policy restrictions, and stipulate clear transfer deadlines and breach of contract liability clauses in the agreement.

If you are facing similar problems, it is recommended that you consult a professional lawyer as soon as possible with the evidence materials, so as to avoid missing the statutory time limit. →Business and commercial legal services·Attorney Lian Wenpin·Beijing Henglu Law Firm