If a new house leaks and is not accepted, who pays the property management fees?
Compiled from: Guangzhou Intermediate People's Court, Zhejiang Tianping
A homeowner refused to accept a new house due to leaks, but was sued by the property management company for overdue fees. In this case, does the homeowner need to pay? How should they protect their rights?
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Case review
[2] In June 2020, the Li couple purchased a house in a residential community in Zengcheng, Guangzhou. In October of the same year, they received a notice from the developer to take possession of the property. Upon inspection, they found extensive water leakage on the walls, so they refused to accept the property and requested the property management to repair the house.
[3] In June 2021, the Li couple inspected the property again and found that the leakage issue had not been resolved. After that, they received no further notice from the property management about the completion of repairs or the handover of the property, nor did they go to check again.
[4] In early 2022, the property management sued the Li couple in court, demanding payment of property service fees and shared electricity fees totaling 5,179.30 yuan from November 2020 to December 2021, along with corresponding late payment penalties.
[5] The property management company argued that, according to relevant legal provisions, the preliminary property service contract signed by the developer and the property service provider in accordance with the law is legally binding on the owners. The property in question was deemed to have been delivered to the Li couple for use from the date the developer notified them to take possession, so the Li couple should pay the relevant property service fees and shared electricity fees on time as per the "Preliminary Property Service Contract" signed between the property management and the developer.
[6] The Li couple argued that after inspecting the property, they found extensive water leakage, and the house has not yet been successfully delivered, so they are not required to pay the fees.
[1] Court Opinion
[2] In this case, the defendants, Mr. and Mrs. Li, signed a "Pre-sale Commercial Housing Contract" with the developer, and the developer signed a "Pre-property Service Contract" with the property company. However, the property service contract and the commercial housing sales contract pertain to different legal relationships. The determination of the conditions for the delivery of the property in question falls under the scope of review in disputes over commercial housing sales contracts. Whether the property in question should be deemed as delivered and used does not fall within the scope of review in disputes over property service contracts.
[3] This case is a dispute over a property service contract. Based on the statements made by the plaintiff and defendants in court and the corresponding evidence, the property company's claim that the property in question should be deemed as delivered and used from the date the developer notified the owners to take possession lacks sufficient grounds. Additionally, when Mr. and Mrs. Li inspected the property in October 2020, there was indeed extensive water leakage. Considering that the property has not yet been actually taken possession and has not been registered under the names of Mr. and Mrs. Li, the court does not support the property company's claims for property service fees, shared electricity costs, and late payment penalties.
[4] The Zengcheng District People's Court of Guangzhou City rendered a first-instance judgment: dismissing all claims of the plaintiff property company. The property company, dissatisfied, filed an appeal.
[5] The Guangzhou Intermediate People's Court rendered a second-instance judgment: dismissing the appeal and affirming the original judgment.
《[1] The People's Republic of ChinaCivil Code
[6] Article 208: Principle of Publicity of Property Rights
The creation, alteration, transfer, and extinguishment of real property rights shall be registered in accordance with the law. The creation and transfer of personal property rights shall be delivered in accordance with the law.
Article 209 Effect of Registration of Real Property Rights
The creation, alteration, transfer, and extinguishment of real property rights shall take effect upon registration in accordance with the law; without registration, they shall not take effect, unless otherwise provided by law.
Natural resources that are owned by the state in accordance with the law may be exempted from registration.
[1] The author's perspective
Generally, an owner shall pay property service fees from the date of signing the delivery documents of the house, but errors may occasionally occur, leading to incomplete delivery. It is noteworthy that as real property, the creation, alteration, transfer, and extinguishment of a house must be registered, rather than taking effect merely through a contract, which is also the key point in the judgment of this case.
In addition, owners should note that if the house is in good condition and the developer issues a delivery notice, but the owner fails to complete the handover procedures in a timely manner due to their own reasons, the collection of property fees will not be affected.
[2] In June 2020, the Li couple purchased a house in a residential community in Zengcheng, Guangzhou. In October of the same year, they received a notice from the developer to take possession of the property. Upon inspection, they found extensive water leakage on the walls, so they refused to accept the property and requested the property management to repair the house.
[3] In June 2021, the Li couple inspected the property again and found that the leakage issue had not been resolved. After that, they received no further notice from the property management about the completion of repairs or the handover of the property, nor did they go to check again.
[4] In early 2022, the property management sued the Li couple in court, demanding payment of property service fees and shared electricity fees totaling 5,179.30 yuan from November 2020 to December 2021, along with corresponding late payment penalties.
[5] The property management company argued that, according to relevant legal provisions, the preliminary property service contract signed by the developer and the property service provider in accordance with the law is legally binding on the owners. The property in question was deemed to have been delivered to the Li couple for use from the date the developer notified them to take possession, so the Li couple should pay the relevant property service fees and shared electricity fees on time as per the "Preliminary Property Service Contract" signed between the property management and the developer.
[6] The Li couple argued that after inspecting the property, they found extensive water leakage, and the house has not yet been successfully delivered, so they are not required to pay the fees.
[1] Court Opinion
[2] In this case, the defendants, Mr. and Mrs. Li, signed a "Pre-sale Commercial Housing Contract" with the developer, and the developer signed a "Pre-property Service Contract" with the property company. However, the property service contract and the commercial housing sales contract pertain to different legal relationships. The determination of the conditions for the delivery of the property in question falls under the scope of review in disputes over commercial housing sales contracts. Whether the property in question should be deemed as delivered and used does not fall within the scope of review in disputes over property service contracts.
[3] This case is a dispute over a property service contract. Based on the statements made by the plaintiff and defendants in court and the corresponding evidence, the property company's claim that the property in question should be deemed as delivered and used from the date the developer notified the owners to take possession lacks sufficient grounds. Additionally, when Mr. and Mrs. Li inspected the property in October 2020, there was indeed extensive water leakage. Considering that the property has not yet been actually taken possession and has not been registered under the names of Mr. and Mrs. Li, the court does not support the property company's claims for property service fees, shared electricity costs, and late payment penalties.
[4] The Zengcheng District People's Court of Guangzhou City rendered a first-instance judgment: dismissing all claims of the plaintiff property company. The property company, dissatisfied, filed an appeal.
[5] The Guangzhou Intermediate People's Court rendered a second-instance judgment: dismissing the appeal and affirming the original judgment.
《[1] The People's Republic of ChinaCivil Code
[6] Article 208: Principle of Publicity of Property Rights
The creation, alteration, transfer, and extinguishment of real property rights shall be registered in accordance with the law. The creation and transfer of personal property rights shall be delivered in accordance with the law.
Article 209 Effect of Registration of Real Property Rights
The creation, alteration, transfer, and extinguishment of real property rights shall take effect upon registration in accordance with the law; without registration, they shall not take effect, unless otherwise provided by law.
Natural resources that are owned by the state in accordance with the law may be exempted from registration.
[1] The author's perspective
Generally, an owner shall pay property service fees from the date of signing the delivery documents of the house, but errors may occasionally occur, leading to incomplete delivery. It is noteworthy that as real property, the creation, alteration, transfer, and extinguishment of a house must be registered, rather than taking effect merely through a contract, which is also the key point in the judgment of this case.
In addition, owners should note that if the house is in good condition and the developer issues a delivery notice, but the owner fails to complete the handover procedures in a timely manner due to their own reasons, the collection of property fees will not be affected.
