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The Influence of Construction Qualification on the Effectiveness of Engineering Construction Contract

Author: HuLiuXi
Tutor: WangMingSuo
School: Henan University
Course: Civil and Commercial Law
Keywords: Construction qualification engineering construction contract mandatory regulation Effectiveness of the contract
CLC: D923.6
Type: Master's thesis
Year: 2010
Downloads: 395
Quote: 5
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Abstract

As per the regulations contained in“Construction Law”upon the construction qualification of construction enterprises, the circles of theory and practice hold the following points of view: it is the limitation to the capacity for civil rights of construction enterprises, or limitation to the capacity for civil disposition of construction enterprises, and the construction enterprises without construction qualification do not have the entity qualification of signing contract; or it is the mandatory regulations on construction qualification, but there are many disputes upon whether it belongs to mandatory regulation on management or on effectiveness to construction qualification. The clarification to the nature of construction qualification will give direction in practice to judge whether the engineering construction contract is effective, and have important meanings on disposing correctly the engineering construction contract disputes signed by the construction enterprises that breach the regulations on construction qualification. The paper starts from the definition and nature of construction qualification, analyzes and holds the point of view that construction qualification shall belong to the category of mandatory legal regulation, then, within the theoretic framework of current mandatory regulations, it further demonstrates that the mandatory regulations on construction qualification in“Construction Law”are effective mandatory regulations, and the engineering construction contract signed breaching the regulations on construction qualification shall be viewed as ineffective contract. Combining with the theory of mandatory regulations, the paper further demonstrates the degree of influence of the common types of breaching construction qualification by construction enterprise to the effectiveness of engineering construction contract. Finally, combining the advanced management system in advanced countries on construction qualification, the paper brings forward the points including abolishing the grading system of construction qualification, executing registration and recording system of construction qualification, introducing mandatory insurance system and engineering guaranty system, so as to reasonably settle the conflicts between“Construction Law”which protects social public interests and“Contract Law”which protects free contract.The paper consists of introduction, text and conclusion.The introduction mainly introduces the origin, background and meaning of study of writing the paper, which is the foreshadowing of the text.The text consists of five parts. Part 1 and Part 2 study the preconditions of the paper and Part 3 to Part 5 is the main body of the text.Part I: Analysis of the concept and nature of construction qualification. Construction qualification is the approval and grading confirmation to the conditions owned by the engineering construction enterprises including registered capital, professional and technical personnel, technical equipment and completed construction performance and granting the permit of engaging in engineering construction activities in form of certificate according to the practicing standard of building construction enterprise regulated in advance by state construction competent administrative department. The part starts from the nature of construction qualification, and carried out theoretic demonstration to the relativity between construction qualification and capacity of civil rights of the legal person, construction qualification and capacity for action of the legal person, construction qualification and business scope of the legal person, construction qualification and mandatory standard with the method of comparative analysis for the sake of making comparatively scientific recognition to the nature of construction qualification. Based on this, it obtains the conclusion that the origin of construction qualification’s influence to the effectiveness of engineering construction contract is the breaching of the mandatory regulations on construction qualification stated in laws and administrative rules. It aims to make necessary forshadowing of theoretic basis for the thesis of the paper.Part II: The influence of mandatory to contract effectiveness. Starting from the theory and practice of the influence of mandatory regulations to contract effectiveness in relevant countries and regions, the part summarizes the judging procedure and method of mandatory regulations with effectiveness. As for judging method, the first is interest balancing, the contract effectiveness can only be denied under the conditions that the interest under mandatory protection are more needed to be protected than the free interest protected in the contract; the second is judicial interpretation, in the course of practice judging, probe the aim of legislation standard of mandatory regulations via the strong function of law explanation, and its effectiveness can only be denied when the contract breaches the aim of legislation standard. It aims at seeking theoretic support for the influence of construction qualification to engineering construction contract.Part III: Analysis of the influence of construction qualification to the effectiveness of engineering construction contract. Adopting the basic theory and judging method of the influence of mandatory regulations to contract effectiveness, the part induces that the regulations on construction qualification stated in“Construction Law”are not mandatory regulations on management, while mandatory regulations on effectiveness, i.e. the engineering construction contract signed by the contractor under the condition of breaching the regulations on construction qualification shall be viewed as ineffective contract. The part also demonstrates one by one the influence of the construction enterprises’breaching of various regulations on construction qualification to the effectiveness of engineering construction contract.Part IV: The legal consequence after the engineering construction contract breaching the regulations on construction qualification becomes ineffective. After the engineering construction contract is confirmed ineffective, because the property can not be returned and the property can not be restored to the state before the contract is signed, only the method of discount compensation can be adopted. For construction enterprises, whether the engineering payment is settled is decided by whether the engineering quality is qualified. From the aspect of bearing responsibility, that is the contractor and party issuing contract bear the corresponding responsibility as per their own fault. In addition, because the contractor breaches the mandatory regulations on construction qualification, it shall also bears corresponding civil, administrative and criminal punishment.Part V: Visualization to the system of construction qualification. Based on the combination of the qualification management system in the UK and USA, the part seeks the stick of Chinese construction enterprise breaching the regulations of construction qualification and resulting in the ineffectiveness of engineering construction contract. It is suggested in the paper that on maturity the legislation department shall gradually abolish the qualification grading system of construction enterprises, the state shall move the core of qualification management to the management of the practicing qualification of civil construction, and the level of the comprehensive construction capacity of the construction enterprises shall be measured by the market. The paper holds the point of view of adopting registration and recording system to construction qualification as so to provide a fair competition environment in the construction market. Meanwhile, engineering mandatory insurance system and engineering guaranty system shall be introduced so as to make valid risk control in each stage of engineering bidding and implementation. This can both maintain effectively the effectiveness of engineering construction contract and secure the quality and safety of construction engineering. Regulate construction market with more scientific attitude which follows the development rules of market economy to create a good competitive environment for construction enterprises.The conclusion is the brief summarizing of the viewpoints of the paper.

The Influence of Construction Qualification on the Effectiveness of Engineering Construction Contract

Abstract

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