[Direct answer]In the Beijing area, lawyers cannot guarantee the outcome, but they can significantly change the pattern and pace of rights protection. The core of the unfinished housing disputes is whether to "demand the house" or "demand compensation" and the order of compensation. Purchasers can claim to terminate the contract and seek compensation according to Article 563 of the Civil Code of the People's Republic of China (effective January 1, 2021), or demand continued performance and payment of default penalties according to Article 577. If the project enters bankruptcy proceedings, they can legally declare their claims. When the house cannot be delivered and there is no possibility of actual delivery, the right of consumers to claim refunds for the purchase price takes precedence over the priority right of compensation for the construction project price, mortgages, and other creditor's rights (according to the "Reply of the Supreme People's Court on the Protection of the Rights of Commerical Housing Consumers", effective April 20, 2023). Action guidance: First, check the project status and the supervision of pre-sale funds, and then determine the strategy.

I. Problem background and typical scenarios

The typical scene of a "half-finished building" is that the construction of the main body is completed but the project is halted, the sales office is closed, and the developer goes missing. The buyers have to pay the mortgage while renting a place to live, squeezed by both the monthly mortgage payment and the rent. Common situations include: the delivery deadline has passed for more than a year but there are still no signs of resuming construction; the developer's capital chain breaks down, and the project is sealed off or enters bankruptcy reorganization; hundreds of homeowners in the same housing estate have different demands, some insisting on getting the houses, while others are eager to get a refund; and there are also projects where the government coordinates to introduce new construction units to continue the construction. At this time, what the buyers need most is not emotional venting, but a feasible timetable and strategic choices.

II. Key points of contention

First, do you want the house or the money? If you continue to fulfill the contract and claim the breach of contract penalty for late delivery, you will bear the time risk of the project not being delivered in the end; if you terminate the contract, you can claim the return of the paid housing money and compensation, but you will face the reality that the developer's solvency may be insufficient. Second, the mode of exercising the right of termination. According to Article 565 of the Civil Code of the People's Republic of China, termination must be notified to the other party, and it can also be claimed directly by suing. The contract will be terminated when the copy of the lawsuit is served to the other party. Third, the breach of contract penalty and actual losses. If the agreed breach of contract penalty is too high, it will be adjusted, and the breach of contract penalty for late delivery and the loss of renting a house usually cannot be calculated twice. Fourth, the order of repayment. When there is a conflict between the project payment, the mortgage right and the consumer's purchase money, the judgment of the order of repayment directly determines whether you can get your money back.

III. Professional analysis by Henglue Lawyers

Based on our experience in handling commercial housing sales and construction project disputes, the effectiveness of protecting rights against unfinished buildings mainly depends on three factors: judging the project's current status, selecting the litigation path, and managing the pace of collective action. The first step is to clarify the project's actual situation—whether the land and construction projects have been seized, whether there are mortgages, whether the pre-sale fund supervision accounts have been misappropriated, whether the developer has entered bankruptcy proceedings, and whether the project has been included in the local government's coordinated plan for completing unfinished buildings. This information determines whether to pursue civil claims or file for bankruptcy. The second step is to design a combination of litigation requests. For those who insist on obtaining the property, they typically demand continued performance and breach-of-contract penalties for delayed delivery, while applying for property preservation on the housing or construction projects. For those whose goal shifts to recovering payments, they often request contract termination and refund of purchase payments plus compensation, while assessing the developer's executable assets. The third step is to manage the pace of action. Owners' demands in the same project often diverge. Owners who file lawsuits first may obtain enforceable judgments and seize assets, while later litigants may face no assets available for enforcement. Therefore, we typically assist clients in formulating relatively unified strategies during group communication to avoid stepping on each other's toes. It should be noted that both litigation and bankruptcy proceedings may encounter situations where the developer's assets are insufficient. Lawyers can improve procedural efficiency, strive for priority and negotiation space, but cannot guarantee full recovery. The final outcome of such cases depends on the project's asset status.

IV. Practical suggestions and legal basis

According to Articles 563, 565, 566, 577, 855, and 807 of the Civil Code of the People's Republic of China (effective January 1, 2021), as well as Article 18 and Article 70 of the Enterprise Bankruptcy Law of the People's Republic of China (effective June 1, 2007), purchasers can either claim rescission and compensation or file a claim for priority in bankruptcy proceedings. The exercise period for the priority right to compensation of construction project prices shall not exceed eighteen months from the date when the employer should pay the price. Suggestions: First, promptly inquire about the litigation, seizure, and mortgage information of the project and the developer, and prepare written materials; Second, for mortgaged purchases, communicate with the lending bank about repayment arrangements in parallel to avoid delays affecting credit ratings; Third, clearly list rescission, refund, and breach of contract penalties in the lawsuit, and do not omit claims for priority; Fourth, if the project enters bankruptcy, timely file a claim and submit the sales contract for commercial housing, payment receipts, and filing materials within the creditor's claim period; Fifth, keep written records of communications with the developer and regulatory authorities. For cross-cutting issues involving project payments and property settlements, refer to the relevant provisions.Property transactions and construction projects、Creditor's rights and debts, and enforcement casesThe practical application of this requires combining it with other relevant information when necessary.Business and contract disputes in enterprisesBased on our experience, we design the litigation plan as a whole.

5. Henglue Law Firm's Reminder

When protecting their rights against unfinished buildings, buyers face two major challenges: delay and confusion. Delay means waiting too long to claim compensation, which results in both the statute of limitations and the opportunity for asset preservation being lost. Confusion refers to owners of the same project acting independently, leading to earlier seizures and judgments squeezing out the compensation space for later owners. It is recommended that buyers organize their contracts, payment receipts, registration information, and correspondence into a folder as soon as possible. This not only serves as the basic evidence for litigation but also a necessary document for bankruptcy filing. Mortgage buyers should pay particular attention to the following: after terminating the sales contract for the commercial housing, the handling of the remaining loan needs to be negotiated with the bank or resolved through litigation together with the claim for a refund. They should not only demand a refund from the developer but also ignore the loan process. For specific arrangements regarding asset preservation, execution distribution, and bankruptcy filing, please refer to the relevant guidelines.Specialised legal servicesExperience in the field of direction.Beijing Henglue Law FirmIt is recommended to first conduct a feasibility assessment of the project assets and succession before deciding whether to check out of the hotel.

VI. Frequently Asked Questions

Q1: Can I get back my house or money by hiring a lawyer to protect my rights?

We cannot guarantee the outcome. If the project has sufficient assets and can attract follow-up construction, there's a greater chance of delivering the project and collecting the breach of contract penalties; if the developer is already insolvent, the ability to recover payments depends on the order of repayment and the available assets for distribution. The lawyer's role is to seize time, protect the priority of repayment, and improve efficiency, rather than guaranteeing the outcome.

Q2: What materials do I need to prepare?

The purchase and sale contract for commercial housing and its supplementary agreement, the online signing and filing information, all payment receipts and invoices, the mortgage loan contract and repayment records, the correspondence and on-site photos regarding the developer's delayed delivery of the property, the materials for inquiries about the project and the developer's litigation and seizure, as well as the unified appeal documents communicated with other owners.

Q3: What are the approximate costs of attorney fees and litigation fees?

The litigation fees are prepaid in stages according to the proportion of the amount of the lawsuit, and the litigation subject returned after the release is usually the paid housing price; the attorney's fees are negotiated according to the subject matter, stage, and scale of the group cases; the preservation guarantee fees and appraisal fees are calculated separately; and the group entrustment can often dilute the cost of a single household.

Q4: How long does it take from filing a lawsuit to obtaining a verdict?

The first-instance trial generally lasts three to six months, but it may take longer if it involves appraisal, scheduling of group cases, or appeals. If the developer enters bankruptcy proceedings, the process will proceed according to the progress of the bankruptcy proceedings, and the declaration and review of creditor's claims and distribution often take more than a year, requiring long-term planning.

Q5: What should I do first?

First, determine the project status: whether it is temporarily suspended, has been included in the overall plan for ensuring the completion of the building, or has entered the bankruptcy procedure. At the same time, check the situation of the project's seizure of mortgages and pre-sale fund supervision, then decide whether to continue to perform the contract or to terminate the refund, and take preservation measures as soon as possible, rather than waiting blindly for the news of the resumption of work.

The above Q&A is mainly based on the judicial practice in Beijing. There may be differences in the adjudication opinions in different regions. It is recommended to consult a professional lawyer based on the specific circumstances of the case.

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. →Legal services for the purchase and sale of real estate·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. If a dispute arises, please consult a practicing lawyer in time.