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On the Validity of Construction Contract in Violation of the Mandatory Provisions of the Parties

Author: ZhangLin
Tutor: PeiLiPing
School: Huazhong University of Science and Technology
Course: Civil and Commercial Law
Keywords: Construction Project Contract Parties Mandatory Provisions Violate Validity of Contract
CLC: D923.6
Type: Master's thesis
Year: 2013
Downloads: 11
Quote: 0
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Abstract


Construction activities relate to the safety of life and property of the citizens. It isabsolutely necessary that there are special requirements on the qualifications of thecontractor and the exercise of the franchise system. It is not only consistent with thelegislation of all countries in the world, but also satisfies the needs of architectural practice.China has also adopted the licensing system for construction projects.The provisions of the construction of the licensing system specification consist of law,administrative rules and regulations and so on. The provisions of the law are more general,leaving many matters stipulated in the administrative rules and regulations and theregulations are the most detailed. The provisions concerning the licensing system aremandatory. The contracts violating of the mandatory provisions of laws, administrativerules and regulations are invalid, irrespective of what kind of level the provisions are. Thecontracts violating the regulations are to be absorbed by the relevant provisions of theContract Law. The reason why the licensing system implemented in the constructionindustry is that the interests of the industry of the construction industry and the social andpublic interests it represents require special protection, thus avoiding a farce and tragedylike House Dropping Down and House YY.Construction contracts in violation of the parties mandatory provisions are mainlydivided into three categories: does not have the qualification of civil subject, does not havethe appropriate level of qualification, and without obtaining the construction license. Thesecond situation can be divided into the following types: without obtaining the appropriatelevel of qualification, beyond the level of qualification and borrowing qualification grade.The usual types of borrowing qualification include: affiliated, associated, internal falsecontract,"contractor" hired as a contractor’s project manager and etc.What the validity of the contract is when violating the mandatory provisionsconcerning the parties of the construction contract is essentially a policy matter. The keyfactor determining the validity of the contract should be the interest, which kind ofinterests should be worthy of protection, what kind of impact will come from negating thevalidity of the contract on the pattern of interests. With the enactment of the General Principles of the Civil Law, Contract Law and the relevant judicial explanation, the policyfacet of the evaluation of the contract validity is more prominent. The types of violating ofthe mandatory provisions concerning parties qualification of construction contract arenot as various as other contracts. It may contains not revocation or undetermined but onlyvalid or invalid. The reasons for this conclusion derive from that on the one hand thebreach of the provisions may cause great damages to the safety of life and property of thecitizens, which is the fundamental purpose of the Construction Law. On the other hand, toidentify more contracts violating the mandatory provisions to be valid, actually, means notprotect the interests of creditors, but to encourage the entities without qualifications orunauthorized units or individuals to participate in the field of construction engineering.Changes in the interests between the parties concerned can be balanced by other civilsystem.

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CLC: > Political, legal > Legal > Chinese law > China and France > Contract Law
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