Facing the recent trends in urban renewal and land development, many long-term local homeowners enjoy seeking developers to collaborate with. Given the significant potential benefits, some developers even proactively approach homeowners to discuss development projects. However, have you considered what to do if the developer delays handing over the property after you've entrusted them with your land and house for development?

Joint Development Contracts and Different Development Models

A joint development contract is a cooperative model the landowner and the developer jointly engage in real estate development. The landowner provides the land, and the developer is responsible for investment and construction. Depending on the specific method of cooperation, joint development can be categorized into the following types:

1. Joint Development for Sale: The landowner and developer sell the land and building separately. Buyers must sign separate contracts with the landowner and developer for the land and building.

2. Joint Development for Housing Allocation: After the building is completed, the developer and landowner allocate the houses according to an agreed ratio, with each party selling or retaining their portion.

3. Joint Development with Revenue Sharing: The parties agree on a ratio for sharing the revenue from real estate sales, with no need for prior ownership transfer.

4. Construction Delegation: The landowner entrusts the construction entirely to a development company, paying related construction and management fees. This method is less common and is typically used when the landowner lacks construction experience.

Each method has its unique characteristics and suitable scenarios. When choosing a cooperation method, both the landowner and developer should consider their needs and expectations, explicitly defining their rights and obligations in the joint development contract. The legal nature of such contracts is complex and may involve multiple forms, such as barter agreements or mixed contracts of sale and contract work. Therefore, it is crucial for both parties to seek legal advice before signing to ensure the contract's legality and validity.

Key Considerations for Property Handover

When conducting a handover under a joint development contract, i.e., delivering the completed building, particular attention should be given to the following key points:

1. Handover Procedures: Ensure mutual agreement on the time, place, and method of handover and follow the agreed procedures. This may include inspecting construction quality and confirming compliance with building regulations.

2. Responsibility Allocation: Any issues discovered during the handover process must clearly define the developer's responsibilities. The contract should include specific and clear clauses about responsibility allocation.

3. Rights Transfer and Registration: Changes in rights, such as the transfer of land and building ownership, must follow the agreed procedures and ensure proper handling of public registration.

4. Strategies for Developer Non-Compliance: If the developer fails to hand over as agreed or delivers a building that does not meet the specified standards, the landowner should have a pre-planned strategy. This might include pursuing legal action, seeking compensation, or invoking contract termination clauses.

What to Do When a Developer Refuses Handover - Case Study

Case Facts

In 2011, Mr. Chen from New Taipei City inherited a plot of land and happily collaborated with developer Mr. Li, signing a joint development contract. According to the agreement, Mr. Chen provided the land, and Mr. Li would construct a building.
After completing the building and obtaining a usage license, Mr. Li completed the preservation registration for the property allocated to Mr. Chen and transferred ownership to him.
However, before the property was handed over, Mr. Chen received a notice from the Public Works Bureau stating that the building had unauthorized modifications not compliant with building regulations. The notice required the developer to rectify the issues before handover. Despite repeated attempts to contact Mr. Li, he ignored the matter. Frustrated, Mr. Chen sought legal assistance from this firm.
According to Article 767 of the Civil Code: “The owner may claim restitution of property against anyone who unlawfully occupies or takes possession of it. The owner may request the removal of anything that obstructs their ownership or take measures to prevent such obstruction.”
The land and building ownership certificates serve as proof of real estate rights. As Mr. Chen is registered as the owner of the property and land, the ownership certificate issued by the land administration clearly establishes him as the rightful owner.
Even though Mr. Li never handed over the ownership certificate, it does not change the fact that Mr. Chen is the rightful owner of the property and land after the ownership transfer registration. Therefore, Mr. Li is obligated to hand over the ownership certificate and deliver the property to Mr. Chen.

Real estate litigation often involves deeply rooted family homes and significant interests. If you encounter disputes related to real estate, it is advisable to consult a real estate professional lawyer promptly to protect your rights.

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