Realtor hit for double dealing |
http://www.sina.com.cn 2005/03/04 19:45 Shanghai Daily |
A city court has ordered a local real estate company to pay 1.83 million yuan (US$220,482) in compensation for selling the same property to two different buyers. "This case indicates that developers who engage in fraudulent practices will be certain to receive severe punishment," said Liang Zong, a judge at Shanghai No. 2 Intermediate People's Court, which handled with the lawsuit. The case dates back to a presale agreement signed in November 2001 between buyers Xing Dadong and Shi Guorong and the Shanghai Dongxing Real Estate (Group) Co Ltd for commercial property on Qinghu Road in Qingpu District. After the contract was signed, it was filed with the district's real estate trading center. The deal was for 1,100 square meters worth of space valued at 3.66 million yuan. The buyers paid the entire amount, and Dongxing promised to deliver the property to the plaintiffs on May 1, 2002. Eight months after the original deal, the trading center granted Dongxing's request to withdraw the presale document, saying the buyers had agreed to abort the transaction and receive a refund. The company then sold 882 square meters of the same property to a man surnamed Cai for 3.4 million yuan. Given the smaller size involved, the square-meter price was higher than in the previous sale. When Xing and Shi learned about the transaction, they filed a lawsuit demanding the return of their purchase money plus compensation for being left on the hook. Dongxing initially argued that the plaintiffs had given it only 1 million yuan and had already received a refund of 500,000 yuan. The court determined that the initial contract supported the plaintiffs and ordered the return of the entire 3.66 million yuan. Turning to the compensation issue, the court noted that real estate guidelines from the Supreme Court state that if a developer sells property to a third party after a contract is signed, the buyer has the right to ask to terminate the contract and recover any money paid plus compensation that can range up to the full payment amount. The court then ruled that Dongxing should compensate the plaintiffs by paying half of the original purchase transaction. |