DeHeng Lawyers Saved a Client a Loss of Ten Million Yuan in a Construction Contract Dispute


Recently after rounds of negotiation among stakeholders, a contract dispute over a construction project represented by DeHeng was successfully mediated under the auspices of the court, saving the client a loss of more than ten million yuan. In this case, DeHeng lawyers once again successfully applied the criminal-civil crossing method to turn around the situation and protect the client’s lawful rights.

Case summary:

In November 2011, Company A – a real estate developer – awarded the construction contract of a large residential property project in Beijing to Company B – a construction group corporation, and an EPC contract was signed. Later, disputes arose over the payment of project funds, the outstanding work, and project loans, etc. Company B lodged a lawsuit against Company A, demanding the payment of the construction expenses due and its interest.

Mandated by Company A to represent it in the lawsuit, the DeHeng litigation service team, composed of Wang Gang, Qin Guorui, Cao Pengjuan and Li Ang, looked deep into details of the case, and found that the tricky part was that Company B was so sure of winning the case that it refused to make concessions or even mediation, and asked the court to rule directly.

After combing the facts, DeHeng lawyers found that the project had a major defect: the actual construction was done by a unit without qualifications affiliated to the qualified plaintiff. Should the affiliation was confirmed by the court, the plaintiff might face a significant risk of administrative penalty or even revocation of construction qualification. On the other hand, when the actual constructor borrowed money from Company A, the loan was granted based on the affiliation. If the court determined that there was no affiliation, the borrowing would be suspected of contract fraud. Under the heavy pressure of possible criminal liabilities, and after many rounds of communication, the actual constructor finally agreed to show up in court. Finally, through the tireless efforts and repeated communication of DeHeng lawyers, the three parties involved in the case finally reached a settlement on the project arrears, the outstanding work, and the project loan. The court completed the case after issuing the mediation letter which saved Company A a loss of more than RMB 11 million. 


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