Study On Priority Right Of Actual Constructors In Construction Contract

The actual constructor is not a concept from construction project contract.According to the relevant laws and regulations of construction project in China,the contractor of a construction project must be a qualified enterprise.Individuals and units without qualifications cannot carry out construction projects.However,the non-standard construction market in China has led to the emergence of actual constructors.Compared with the contractor or sub-contractor in the case of valid construction contract,the actual constructor is the relative concept arising from the construction contract of invalidity.According to the case of the court,this paper summarizes the main types of actual constructors which have been identified in practice.Firstly,the contractor who participates in the signing and performance of the all-construction subcontract and actually completes the all-constructing task is the actual constructor.Secondly,the contractor who participates in the signing and performance of illegal part-construction subcontract and actually completes the part-constructing task is the actual constructor.Thirdly,the non-qualified unit or individual who negotiates and signs the construction contracts with the developer in the name of a qualified contractor is the actual constructor.In this paper,if you compare the actual contractor with the four main concepts in the field of the construction project,the contractor,sub-contractor,builder and migrant workers,it can be see that when identifying the actual constructor with the contractor,it is not only through the validity of the construction contract of the construction project to distinguish them,but also through the combination of the reasons for the invalidity of the construction contract,whether the actual construction is carried out,what kind of agreement exists between the actual constructor and the contractor,and whether the actual constructor has direct contract relativity with the contractor.Compared with the sub-contractor,the actual contractor must actually complete the subcontract operation when participating in the illegal subcontract,but the sub-contractor's participation in the subcontract is legal and does not need to obtain the sub-contractor status by completing the subcontract operation.The builder in the field of the construction project must be a qualified construction enterprise,but the actual contractor can be either an enterprise without qualifications or a natural person,even an enterprise with qualifications can be the actual contractor.Actual contractors are not migrant workers.Actual contractors generally have contractual relationships with contractors or sub-contractors.They are the contracting parties of illegal all-construction subcontract,illegal part-construction subcontract,agency agreements or commissioning agreements with nominal contractor of the construction contract.There may be employment relationships between the actual contractor and the migrant workers.This paper attempts to discuss the nature of the priority right of the compensation for construction project price,and considers that the determination the compensation priority right as legal priority is in line with the formulation of our current legal system.The text also explores the nature of the right of the actual constructor to claim the project price to the contractor.It holds that the doctrine of subrogation,factual contract and return of unjust enrichment are biased.It tends to agree that the nature of the right belongs to the exception of the principle of contract relativity.The reasons include: firstly,the field of construction contract is the legal field which breaks the law of contract relativity more often;secondly,there is no relative contract relationship between the actual contractor and the contraction developer,but the actual contractor needs to assume responsibility to the developer under the exception of contract relativity;third,the construction contract between the developer and the contractor has the need to protect the interest of migrant workers survival;fourth,the developer enjoys the ultimate benefit of the achievements of the actual contractor.therefore,the developer should have joint and several liabilities to compensate for the project price of the actual constructor.This paper also discusses the nature of the right of the actual constructor to claim the project price to the developer under the affiliated mode.This paper holds that the affiliated actual constructor is the real counterpart of the contract to perform the affiliated construction contract in the case of conspiracy by the developer.The actual constructor can claim the the project price to the developer as an invalid contract contractor.This paper holds that if the developer is unaware of the actual construction person's affiliation,the actual constructor should strictly follow the principle of contract relativity,and only the nominal contractor can exercise the right of recourse for the project price.The actual constructor can only exercise the nominal contractor's right to the project payment by subrogation.This paper holds that the main utility of the priority right of construction project price is to guarantee the developer to fulfill the obligation of payment of construction project cost in the construction process,which can effectively solve the survival problems of vulnerable groups such as migrant workers.The validity of construction contract is not necessarily essential for the priority right which guarantees the creditor's right of construction project price.This paper also tries to discuss whether the creditor's right guaranteed by the priority right should be compatible with the value-added benefits of construction projects.This paper holds that when the value of the construction project itself is much larger than the project fund which held by the creditor's right,the developer will choose to actively repay the arrears of the project funds under the trend of interests,so as not to fall into the situation that the construction project will be executed to pay for the project fund in priority.When the contractor maliciously claims the compensation priority right,the court can correct the default by ascertaining the facts.In both cases,it can be argued that the compensation priority right of construction project price can be advocated on the principle that the creditor's rights of construction project price should be matched with the added benefits of construction project.According to the case of the court,this paper also analyses the current situation of the practice that the actual constructor enjoys the compensation priority right for the construction project price.This paper holds that it is legitimate for the actual constructors to enjoy the compensation priority right.The creditor's rights of the actual constructor to recover the project funds are protected by law and the developer,the contractor or the sub-contractor are also guilty of illegal construction.Since the judicial interpretation requires the contractor to pay the actual constructor within the scope of arrears,the actual constructor should have the priority right in the scope of repayment.Although the theoretical and practical circles have not yet agreed on the way in which the actual constructors exercise the priority right to compensation,they all hold a positive attitude towards the legitimacy of the priority right to compensation of the construction project price for the actual constructors.This paper also analyses the jurisprudence that the actual constructor has the priority right to receive compensation for the construction project price.When the type of the actual contractor is the sub-constructor of an illegal subcontracting contract and the contractor of the main contraction contract owes the project funds and does not claim or is lazy in claiming the priority right to be compensated,the actual contractor can break the principle of contract relativity as the counterpart of the developer and shall enjoy the guarantee right on the payment obligation of the project funds.The actual constructor may also claim the creditor's rights of the illegal subcontractor for the project payment of the contractor by subrogation,and at the same time claim the priority right.In some cases,the actual constructor and the developer also constitute the relationship of the factual construction contract.In the case that the developer participates in and performs the invalid construction contract,the actual constructor enjoys the priority to be repaid while claiming the creditor's rights of the project funds to the contractor.The above situation also includes that the developer consults with the actual contractor to conclude the construction contract relying on the qualification of others.The relying actual contractor obtains the status of the contractor of the invalid construction contract,and can directly claim compensation from the contractor and exercise the compensation priority right.When the developer has no conspiracy with the actual contractor to conclude the construction contract relying on the qualification of others,the author tends to think that only the nominal contractor has the right to claim compensation from the contractor and exercise the compensation priority right.The affiliated actual contractor can only request the nominal contractor for the right to claim the project funds after the contract is invalid based on the invalid agency contract or the entrusted contract.If the contractor in name owes the actual constructor payment and does not claim or is lazy to claim the project payment creditor's right of the developer,the actual constructor can claim the creditor's right of the contractor in name by subrogation,and at the same time claim the compensation priority right.This paper also summarizes the requirements for the actual constructor to claim the compensation priority right under the conditions of legitimacy,including: first,the actual constructor has the right to claim or subrogate the creditor's rights of the project payment to the developer;second,the object of the priority of the actual constructor can only be independently contracted by the actual constructor or contractor,and the construction project must have the property of market circulation;The construction project has not been discounted or auctioned because of the priority right;fourth,the contractor who concludes the contract with the developer does not advocate or neglect to realize the compensation priority right.Finally,this paper also discusses the conflict resolution mechanism between the actual constructor's priority right and the contractor's priority right,consumer's right,bank mortgage and wage creditor's right.This paper holds that the priority of the actual constructor should not be against the priority of the contractor,but it can continue to be asserted within the scope of the non-claim;the priority of the actual constructor should not be against the real right expectancy of consumers and the right to request the return of housing funds;the actual constructor should not exercise the priority right against the bank mortgage right which forms after consumer's purchase of commercial house.The actual constructor exercises the priority right of repayment prior to the wage claim for the reason that the wage claim should not be exercised before the actual constructor's repayment priority right.