Abstract The civil legal norm always requires special qualification for the subject of contract. The contract for construction projects is typical of this kind. The subject of such contract should engage in construction activities within the permitted scope of its approved qualifications. When the subject lacks or exceeds his/her qualification, he/she concludes a contract, since the Interpretation of the Supreme People’s Court states that such a contract is invalid due to the violation of compulsory rules. However, the contract will turn to be valid if the subject obtains the required qualification afterwards. After sorting out and analyzing the cases of contracts for construction projects involving the subject’s qualification, it is found that the disputing focus concentrates on determining whether the regulations of qualification are compulsory rules, as well as on distinguishing the relationship between the business scope of a company and the legal person’s qualification. The courts are inclined to judge the contract for construction projects invalid if there is a flaw in the subject’s qualification. It is infrequent that this kind of contract turns to be valid after the subject obtains the required qualification afterwards. The existing laws and regulations specifically state that the construction subject ″is prohibited to″ or ″shall not″ engage in construction business exceeding its qualification. It is not hard to see that the Supreme People’s Court just literally interprets the qualification provisions as compulsory rules. However, the fundamental point of determining compulsory rules should be the legislative purpose of regulations. The requirement of subject’s qualification is similar to a procedural one, and there is no substantial conflict between this requirement and the purpose or the freedom of contract. Therefore the contract with a flaw in subject’s qualification should not be judged invalid by reason of violating compulsory rules. The construction subject’s qualification is a grade authentication of its scope of practice after a comprehensive survey, instead of the scope of company business, or the scope of legal person’s capacity. Scholars usually illuminate the judicial interpretation of the fact that the contract will turn to be valid if the subject obtains the required qualification afterwards with the heilung or the best?tigung system of the legal act. Basically, the heilung system of the legal act only applies to cases where there is a form flaw in the special formal act while the best?tigung system is, after the reason of contract invalidation disappears, to confirm the validation of a legal act which contains the same content as the original one. The contract invalidation in Chinese theory is absolute invalidity and voidance ab origin, and thus the invalid contract cannot be turned into valid after the subject obtains the qualification afterwards. Since the problem of the subject’s qualification for construction is not a form flaw, neither the heilung nor the best?tigung system of the legal act can be regarded as the proper theoretical basis for the cure of contract validity. As far as the purpose of legislation is concerned, the construction regulations stipulate strict qualification requirements to the construction subject in order to protect the vital public interests such as the construction safety and personal and property rights. Thus Art.52 (4) ″damaging the public interests″ of Contract Law should be taken as a feasible approach to judging the invalidation of a contract for construction projects owing to the subject lacking or exceeding its qualification. Regarding the subject’s qualification as a special requirement of validity of contract is applicable in the theory of curing the validity of contract, in which the subject obtains the qualification afterwards. But cases where the contract turns to be valid are exceptional.
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