Lawyer from Legal Shengbang said that Liu Xinggui's team: Is it necessarily invalid for people from other villages to buy homestead houses in their own village?

As is well known, the right to use homestead land refers to the usufructuary right of rural residents to occupy and use collectively owned land, and independently use the land to build houses and ancillary facilities for residential purposes. With the continuous acceleration of urbanization in China, the expansion of urban construction has driven the rapid growth of the potential value of rural land in the surrounding areas, stimulating a large number of transfer behaviors of homestead land use rights

As is well known, the right to use homestead land refers to the usufructuary right of rural residents to occupy and use collectively owned land, and independently use the land to build houses and ancillary facilities for residential purposes. With the continuous acceleration of urbanization in China, the expansion of urban construction has driven the rapid growth of the potential value of rural land in the surrounding areas, stimulating a large number of transfer behaviors of homestead land use rights, According to the provisions of China's Land Management Law and its implementation regulations, the transfer of the right to use rural homesteads must be carried out within collective organizations, which means that the purchase, sale, and transfer of rural homesteads under the current system have a legal "exclusionary" attribute. But does this mean that anyone whose household registration is not within a collective economic organization must not buy homestead land? Judicial practice has shown that this is not absolute. The following is a real case handled by the Liu Xinggui team of Guangdong Legal Shengbang Law Firm.


Case Review

One day in November 2020, Ms. Zeng, a villager from a village in Haizhu District who served as a legal advisor to Liu Xinggui's legal team, suddenly visited our office anxiously. She said that she had bought a homestead more than a decade ago and was sued by others to take it back. She was extremely anxious and asked Lawyer Liu to help protect her unique homestead.


After investigation, we have learned the following facts: 17 years ago, Ms. Zeng and a villager named Chen from Village A reached a paid gift agreement and notarized it: Chen and her husband voluntarily donated a certain residential land under their name to Ms. Zeng, and Ms. Zeng compensated Ms. Chen according to the market price. At the same time, it was agreed that if there is any demolition in the future, the compensation fees will belong to Ms. Zeng, although to this day, the registration of the change in the right to use the residential land has not been completed, But the village committee issued a certificate acknowledging the transfer between the two individuals. After signing the agreement, Ms. Zeng and her family began building houses on this barren homestead and have lived there ever since. There was no dispute or peace between the two sides for 17 years until 2020, when the large-scale renovation of the three old buildings was carried out in Guangzhou. Due to its location in the core area of Haizhu District, Jia Village was naturally favored by multiple real estate developers to negotiate the renovation. If the houses on the residential base involved in the case were demolished, the compensation received would be in the tens of millions. Under such huge interests, the villager who once sold the house to Ms. Zeng immediately filed a lawsuit with the court, requesting a judgment to confirm the invalidity of the paid gift contract and return the homestead.


Key points of defense

After a comprehensive understanding of the case and background, Liu Xinggui's legal team searched for over a hundred cases nationwide (where people from other villages purchased homesteads and houses in their own villages). After comprehensive analysis and judgment, it was found that for such disputes, the verdict can be divided into the following categories: 1. The contract was deemed invalid, and the seller only needs to return the purchase price; 2. Determine that the contract is invalid, and file a separate lawsuit for other disputes; 3. The contract is deemed invalid, but the seller shall compensate the buyer for the losses caused by the invalidity of the contract (divided based on the degree of fault of both parties); 4. Fully support the buyer and confirm that the contract is valid. There are very few precedents that fully support the buyer and determine the validity of the contract, accounting for even less than 1%, which greatly tests the legal knowledge and professional level of the acting lawyer.


During the first and second trials, news about the old renovation of Village A was overwhelming (as shown in the figure below), and the judgment in this case will be an important basis for future demolition compensation. Both parties are trying their best to supplement any materials that may be beneficial to themselves.


Liu Xinggui's lawyer team, as Ms. Zeng's representative, submitted more than ten pleadings, proxy statements, and situation statements during this period, demonstrating from multiple perspectives that the validity of the contract involved in the case should be maintained, and ultimately received support from the court's judgment:


1. The gift agreement between the two parties in this case is the true expression of their intentions, and has not harmed the public interest or violated the mandatory provisions of laws and administrative regulations. After a period of 17 years, Chen suddenly retracted his request to confirm the invalidity of the agreement, which is baseless in law and even deviates from good faith. In addition, even if the issue of the effectiveness of the act of donating homestead is set aside, the debt agreement between the two parties regarding the ownership of all demolition benefits and compensation to Ms. Zeng is valid.


2. Household registration is not the only criterion for determining whether Ms. Zeng is a villager of Village A. From 17 years ago to today, Village A has treated and managed Ms. Zeng as the owner of the homestead and property involved in the case. Until the end of 2015, before Village A stopped issuing land shares to all members of the organization, Ms. Zeng received dividends indiscriminately as a member of a collective organization, and the village community also managed and publicized her as an owner, Moreover, what is actually prohibited by law is for farmers to transfer their homesteads to urban residents with different household registration types. Therefore, Chen's claim that Ms. Zeng cannot obtain homesteads because she is not a member of Village A has no factual basis.


3. According to the public information in Village A, in addition to the homestead land involved in the case, there are several homestead houses under the name of Mr. and Mrs. Chen, with an area of nearly 2000 square meters, which seriously violates the national policy of "one household, one homestead". However, transferring excess homestead land to other members of the collective through paid gifts has become a common way for "one household, multiple homesteads" to handle homestead land, which is also an important reason why they are willing to donate homestead land to Ms. Zeng.


4. This case is completely a dispute caused by the imminent demolition of Village A, and both parties have agreed in the gift agreement that the demolition benefits and compensation will all belong to Ms. Zeng. This proves that both parties have already foreseen the potential distribution of demolition benefits on the homestead and made relevant agreements. Therefore, Chen has a clear foresight and commitment to Ms. Zeng's construction, use, land acquisition and demolition after the transfer of the homestead. Moreover, according to the current needs for land acquisition and demolition, the relevant departments do not need to determine the compensation for land acquisition and demolition based on the premise of obtaining certificates. The relevant departments have clearly replied that the ownership of the compensation for land acquisition and demolition can be determined in accordance with agreements or relevant effective legal documents. Therefore, whether the homestead property involved in the case can be transferred for certification is meaningless and will not constitute a necessary element affecting the effectiveness of the contract. This case can be handled in accordance with the effectiveness review elements of the debt contract.


5. Homestead in China has the nature of social welfare, therefore, every member of a collective economic organization is eligible to obtain homestead land. Collective economic organizations ensure that each member obtains homestead land, thereby ensuring their basic living and living conditions. Members of collective economic organizations can obtain a homestead without compensation, which is also a right that collective economic organization members should enjoy due to their membership. The Supreme People's Court has mentioned in multiple judgments that when dealing with disputes related to homesteads, the ownership of rights should be determined fairly and impartially based on the principles of being conducive to production and life, business management, and social harmony and stability. Taking into account historical and current conditions, the court should make a factual decision and, in principle, the ownership of disputed land should be confirmed to the party who manages and uses the disputed land for a long time. Ms. Zeng has already built a house on this homestead and worked hard for more than ten years, which has actually formed a long-term management and use of the land. This land has also become the only place where Ms. Zeng lives in the village collective. If the land is returned to Chen, who owns several thousand square meters of homestead land, it is not fair, but also contrary to the original intention of the social welfare system of the homestead.


6. The judgment in this case has great exemplary value, directly affecting the people, especially the grassroots, in their faith in the law and their adherence to the principle of honesty and credibility! The Notice of the Supreme People's Court on Deepening the Integration of Socialist Core Values into the Interpretation and Reasoning of Judgment Documents (Law [2021] No. 21) clearly requires: 6. If there are no normative legal documents as a direct basis for judgment in civil and commercial cases, in addition to applying customs, judges should also be guided by socialist core values and use the most similar legal provisions as the basis for judgment. If there are no most similar legal provisions, judges should make judicial decisions based on legislative spirit, legislative purpose, and legal principles, and fully utilize socialist core values in the judgment documents Explain the basis and reasons for the decision 7. If a case involves multiple value orientations, judges should make judgments, weigh and choices based on the legislative spirit, legal principles, legal provisions, and socialist core values, determine the value orientations applicable to the case, and provide detailed explanations and reasons in the judgment documents. Undoubtedly, integrity, as a socialist core value, is the cornerstone of maintaining economic order, especially contractual order, It is also an indispensable element of social harmony. It's hard to imagine how a society lacking integrity can have a civilized rule of law, let alone harmony!


Main thrust of court judgment

The main reason why Chen filed a lawsuit for the invalidity of the "Gift Contract" is that Zeng is not a member of Village A. However, the court believes that: firstly, based on factors such as Zeng's birth, life, marriage outside of Village A, his land contracting and management rights, and his association with his family, it can be determined that Zeng is a related member of Village A, and his behavior of purchasing the homestead houses involved in the case is not the same as the situation where outsiders purchase the homestead houses in this village; Secondly, although Village A believes that Zeng is not a member of the village's collective organization, there has been no objection to the transfer of the residential base involved in the case; In addition, there is no homestead under the name of Zeng, while both Chen and her husband have homestead. Based on the principle of maintaining integrity, it is not appropriate to consider the contract as invalid.


Excerpt from Second Instance Judgment


Review and Summary

After nearly half a year of the second trial, Ms. Zeng finally waited for the Guangzhou Intermediate Court to reject the other party's appeal and uphold the original judgment. After receiving the judgment, she personally presented a banner to Liu Xinggui's lawyer team at our office. She sincerely thanked Lawyer Liu for his excellent legal literacy and senior legal experience, which saved a building and decades of hard work. The inscription "Defender of the Law, Prosperity of the Country and Prosperity of the Country" on the banner gives Lawyer Liu Xinggui a sense of responsibility: to use legal knowledge, implement legal thinking, play the role of law in resolving disputes, fully combine facts and legal basis in agency behavior, and strive for fairness and justice for the parties involved, which is the value of lawyers!


At present, Guangzhou is developing its economy through a combination of "urban renewal+high-end commerce", aiming to bring new economic growth points to the Greater Bay Area. The interests involved in urban renewal are enormous, and there will be disputes if there are interests! According to a search on the Judgment Document Network, this type of case does not occur twice a time. There are numerous cases across the country, and various cases pay special attention to the maintenance of the principle of integrity in their handling. Since 2018, more than 100 urban villages in Guangzhou have invited bids from cooperative enterprises to embark on the road of renovating the three old buildings. It can be imagined that many people will turn against each other for the sake of their interests. Related lawsuits are constantly emerging, and the law cannot make clear provisions for every specific situation that may occur in real life. Therefore, when acting as a lawyer in such cases, the law cannot be mechanically applied. Starting from the social environment and the historical background of urban villages, we should comprehensively consider the legislative intent of laws and policies, and strive to strive for more benefits for the client!