Recently, a report titled “A man was ordered to compensate the seller 440,000 yuan after the house price soared after buying a house” triggered A lot of attention. On one portal alone, more than 67,000 netizens participated in comments. In an online survey, 94.6% of the respondents believed that the ruling was “unreasonable and violated the spirit of the contract.” 【Waterproof Oxford ClothManufacturer】
With such a one-sided public opinion, did the referee not predict it in advance? What is the legal basis for this ruling? I believe this is also a question that many onlookers want to ask. However, after reading the report, it is not difficult to find that “the house price rose sharply after buying the house” is not actually the basis for “the ruling to compensate the seller 440,000 yuan.” This case is obviously a “clickbait”.
To understand this case, you must restate the facts. According to reports, in March 2013, Mr. Feng purchased a property located on Songgang West Road, Yuexiu District, Guangzhou City for 2.33 million yuan, with an area of 130 square meters. The property owners of the house are 99-year-old Ma and Mou, who is nearly 90. Previously (November 27, 2012), Ma and Mou, accompanied by their two daughters, conducted a notarization and entrusted Ms. Shan with full authority to handle the property. On March 12, 2013, Mr. Feng and the client, Ms. Shan, signed the “Existing House Sales and Purchase Contract.” On March 20, the transaction was completed.
The money and house are cleared, the transaction is completed, everyone should be happy. But on July 8, 2013, the original homeowners Ma and Mou and their son Mr. Ma filed an arbitration application with the Guangzhou Arbitration Commission, requesting a ruling that the house sales contract was invalid. Mr. Ma’s reason is that his parents have been sick all year round. His father is 99 years old and his mother is nearly 90 years old. They had no capacity for civil conduct when they signed the contract. The entrustment that Ms. Shan accepted to handle the property with full authority was also suspected of violating procedures. However, this application was rejected by the Guangzhou Arbitration Commission. Subsequently, Mr. Ma filed a civil lawsuit with the Guangzhou Intermediate Court, requesting to revoke the award of the Guangzhou Arbitration Commission. The Guangzhou Intermediate Court also rejected the application after hearing. 【Tent fabricManufacturer】
Regardless of whether it is rejected in the first arbitration or later in court, the purpose is to maintain the stability of the transaction and respect the wishes of the property owner. Legally, there is no basis to believe that all elderly people over ninety years old have lost their capacity for civil conduct. Regardless of whether the son agrees or not, the old man has the right to handle his own property. Internal conflicts within the family cannot be a reason to plead bargain.
The reversal of the plot occurred after the death of the old couple (original house owners). His son, Mr. Ma, filed for arbitration in 2014 on the grounds that the transaction was unfair (Mr. Ma was not a party to the transaction, nor was he the owner of the original house, so I don’t know how the arbitration committee accepted him as an applicant). According to the evaluation by the appraisal company, the house involved in the case was appraised at 2,774,683 yuan during the transaction period (note that it did not mean that the house price rose sharply after the transaction), which was 444,683 yuan different from the actual transaction price. On February 25, 2016, the Guangzhou Municipal Arbitration Commission ruled that because the applicants Ma and Mou were at a disadvantage and lacked experience when signing the contract, the rights and obligations of the two parties were unequal, which could be deemed unfair, and the total price of the house should be determined as the assessed value. The price is 2,774,683 yuan, and Mr. Feng should compensate the applicant for the price difference of 444,683 yuan. 【Luggage fabricManufacturer】
The reversal of this case aroused heated discussion because it overturned a contract that was voluntarily reached by both parties—a contract that was not found to contain external factors such as fraud or coercion. For contracts that are obviously unfair when concluded, according to legal provisions, one party does have the right to request the court or arbitration institution to change or cancel the contract. However, the applicable standard for “obviously unfair” is very high – if it is reflected in the price, it should usually be significantly lower than the market price in the same period.�50% or significantly higher than more than 2 times the market price during the same period. The law still does not support rescission of a contract if it is only “slightly unfair”.
A society ruled by law is a contract society, and the stability of the contract is protected by law. Although the case discussed here is not “being awarded compensation for a sharp increase in house prices after buying a house,” the arbitration institution’s broad understanding of “obvious unfairness” has already aroused concerns among many people. Regarding the final handling of this case, there is also the court, but I wonder if there will be another reversal?
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