Global Arbitration Review中国建设工程仲裁问答专章•第一期
信息来源：建领城达所 时间：2021-08-06 作者：建领城达所
编者按上海建领城达律师事务所主任周吉高律师受Global Arbitration Review（《环球仲裁评论》，简称GAR）邀请，为该杂志撰写中国建设工程仲裁问答专章。内容涵盖了建设工程合同履行、法律救济、仲裁程序等57个与中国建设工程仲裁实践密切相关的重要法律问题。建领城达根据中国大陆地区的现行法律规定、司法解释以及司法实践主流观点，对全部问题逐一作出了细致、专业、准确的回答，以期为境外的企业、律师以及仲裁员快速熟悉、了解中国建设工程仲裁法律实务提供指引和参考。“建领城达”公众号将对中国建设工程仲裁专章问答的全部内容进行分期推送，本文为第一期，以飨读者！
Legal system 法系
Is your jurisdiction primarily a common law, civil law, customary law or theocratic law jurisdiction? Are the laws substantially derived from the laws of another jurisdiction and, if so, which? What instruments have legal force and effect? Who are the lawmaking bodies? How and where are new laws published? Can laws be passed with retrospective effect?
China is primarily a civil law jurisdiction.
Chinese laws are historically heavily influenced by laws of Germany, Japan, and Soviet Union.
In the field of construction, the instruments that have legal force and effect include: the Civil Code, Construction Law,
Bidding Law, Regulations on Quality Management of Construction Projects, Judicial Interpretation of Construction Contracts for Construction Projects (I), and etc.
The lawmaking bodies are the National People’s Congress, Standing Committees of National People’s Congress and the State Council.
New laws should be first passed by the National People’s Congress or its Standing Committees, then be promulgated by presidential decrees, and in the end be signed by the President. New laws are published on the National People’s Congress website. The administrative regulations formulated by the State Council shall be submitted to the Prime Minister for signing the State Council Decree for promulgation and implementation. These regulations are published through the State Council Communique and the Chinese government’s Legal Information website.
Typically, laws of China have no retroactive effect but there are exceptional situations.
Contract formation 合同的成立
Q2：What are the requirements for a construction contract to be formed? When is a ‘letter of intent’ from an employer to a contractor given contractual effect?
A2：As per articles 789 and 490 of the Civil Code, a construction contract shall be formed when both parties have affixed their signatures, seals or fingerprints thereto.
Whether a ‘letter of intent’ is effective or not depends on its specific contents. With different contents, a ‘letter of intent’ may be a consultative document, a preliminary contract or a valid contract. When a ‘letter of intent’ constitutes a preliminary contract or a valid contract, it shall have contractual effect.
Choice of laws, seat, arbitrator and language 准据法、仲裁地、仲裁员和语言的选择
Are parties free to choose: (a) the governing law of their contract; (b) the law of the arbitration agreement; (c) the seat of the arbitration; (d) any arbitral rules; (e) anyone to act as arbitrator; and (f) the language of the contract and the arbitration? If not, what are the limitations on choice and what happens if the parties act contrary to them?
For (a) and (b): in China, the parties to a not foreign-related contract cannot choose foreign law as the governing law and the law of the arbitration agreement. The parties to a foreign-related contract may freely choose foreign law as the governing law of the contract and arbitration agreement.
For (c) and (d): parties cannot agree that contract disputes without foreign-related contents shall be submitted to an overseas arbitration institution, but parties can do so if there are foreign-related elements.
For (e) and (f): parties are free to agree on the ones to be arbitrators, the language of arbitration and the language of the contract.
If the agreement and acts of parties are contrary to the above restrictions, the agreement and acts will be deemed as ineffective.
Implied terms 默示条款
How might terms be implied into construction contracts? What terms might be implied?
Terms might be implied into construction contracts by express agreement (written). Typically, there are three types of implied terms in construction contracts:
• non-performance of contractors. For example, if the contractor fails to reply after receiving the employer’s claim report, it shall be deemed as approval from the contractor.
• non-performance of employers. For example, if the employer fails to complete the review or the employer raises no objection within the time limit after receiving a completion settlement agreement submitted by the contractor, it shall be deemed as approval from the employer.
• non-performance of supervisors. For example, if the supervisor fails to complete the review of the bill of quantities submitted by the contractor, it shall be deemed as approval from the supervisor.
Q5：When must a certifier under a construction contract act impartially, fairly and honestly? To what extent are the parties bound by certificates (where the contract does not expressly empower a court or arbitral tribunal to open up, review and revise certificates)? Can the contractor bring proceedings directly against the certifier?
A5：In China, the ‘certifier’ is similar to the ‘supervisor’ under a construction contract.
When parties cannot reach an agreement on the disputed matters (such as the adjustment of the contract price or the construction period caused by changes of laws) through negotiation, in practice, parties would agree that the supervisor can decide the matter with discretion. The supervisor shall prudently make a fair judgment in accordance with the terms of the contract. However, because the supervisor is usually appointed by the employer, it is difficult for the supervisor to make an impartial, fair and honest decision under a construction contract in China.
If parties to the contract do not raise any objection to the supervisor’s decision, the decision shall be implemented. If any party to the contract has an objection, it shall be dealt in accordance with the dispute resolution provision of the contract. Before the dispute is resolved, parties to the contract shall temporarily implement it as decided by the supervisor. After the dispute is settled, if the result of the dispute settlement is inconsistent with the supervisor’s decision, the dispute settlement shall prevail.
The contractor cannot bring proceedings directly against the supervisor. Based on the doctrine of ‘privity of contract’, which is confirmed by the Contract Law, a contractor can only bring proceedings against the employer and claim losses caused by the implementation of the supervisor’s wrong decision.
Competing causes of delay 工期延误原因竞合
If an employer would cause (eg, by variation) a two-week critical delay to the completion of the works (which by itself would justify an extension of time under the construction contract) but, independently, culpable delay by the contractor (eg, defective work) would cause the same delay, is the contractor entitled to an extension?
In practice, there are two situations:
• the contractor is entitled to an extension of time but is also liable for delay to the completion of the works. This situation is
generally agreed in a construction contract in practice. It is difficult to determine the reasons independently caused by any party because the reasons for delay are always so complex. If both the construction contract and laws have no stipulation on liabilities for a delay, parties shall be liable for losses according to the principle of fairness under the Contract Law.
• the contractor is entitled to an extension of time if the contractor can prove that the reason for the delay is caused by the employer, for example, the construction period is delayed for two weeks due to changes of the work made by the employer.
How does the law view ‘disruption’ to the contractor (as distinct from delay or prolongation to the completion of the works) caused by the employer’s breaches of contract and acts of prevention? What must the contractor show for a disruption claim to succeed? If an entitlement in principle can be shown (eg, that a loss has been caused by a breach of contract) must the court or arbitral tribunal do its best to quantify that loss (even if proof of the quantum is lacking or uncertain)?
There is no concept of ‘disruption’ under Chinese laws, but, in practice, some acts of employers in breaching contracts will constitute ‘disruption’ to the contractors. Under these situations, the employer shall be held liable, for example: (i) the employer does not pay the price as agreed, (ii) the main materials, components and equipment provided by the employer do not meet mandatory standards and (iii) the employer does not perform assistance obligations.
When ‘disruption’ transpires, the contractor shall fix evidence and make claims in accordance with procedures agreed in the contract to succeed claims. In practice, the contractor shall submit a notice of intention to claim, a claim report, a notice of continuation of the claim at reasonable intervals (if any), a report on the actual situation and records of continuous impacts (if any).
In general, if an entitlement can be shown in principle but the contractor cannot prove the actual loss, the contractor’s claim will typically be rejected by the court. The court or the arbitral tribunal will not have to do its best to quantify losses. However, in practice, there are also cases where the court or the arbitral tribunal will decide losses based on the facts even if there is a lack of evidence.
How does the law view ‘constructive acceleration’ (where the contractor incurs costs accelerating its works because an extension of time has not been granted that should have been)? What must the contractor show for such a claim to succeed? Does your answer differ if the employer acted unreasonably or in bad faith?
There is no concept of ‘constructive acceleration’ under Chinese laws, but in practice, there are circumstances where the contractor incurs costs by accelerating its works because an extension of time has not been granted but should have been. In accordance with business practice in construction, the employer shall pay the costs.
In practice, the contractor must report the acceleration plan to the employer, carry out the acceleration after being approved by the employer or the supervisor, and then claim costs incurred by the acceleration plan, etc, to succeed claims.
If the employer acted unreasonably or in bad faith, the contractor may claim costs by bringing a suit or apply for arbitration. Meanwhile, the contractor shall collect and fix relevant evidence, such as the acceleration plan signed or approved by the supervisor or the employer, and the paid costs caused by the plan.