Flip-Flop Legal Outcomes over Demolition

From Nation, page 14, issue no. 403, Jan 19, 2009
Abridged translation by Lin Li
Original article: [Chinese]

Five years, and at least three lawsuits lost. Such was the record for Beihai municipality in south China's Guangxi province.
Over the past few years, local courts there have ruled unfavorably against the city government for "forcefully demolishing residential houses".

As Beihai pushed ahead to spruce up its urban villages - crowded, haphazardly built slums in the city center, the city government became the target of lawsuits brought by residents dissatisfied with relocation and compensation arrangements.

The latest case involved Sanhekou Village, located near the commercial district. On November 5, 2008, an intermediate court overturned an earlier decision by a lower court and ruled that the local government had illegally demolished buildings in the village.

After the ruling, residents were looking forward to more favorable compensation negotiations. The the local government, meanwhile, has vowed to appeal the case up to the highest court in the country, if necessary.

The local government had previously lost two other lawsuits in 2003 and 2007 for demolition exercises in Zhongshan-Waisha and Gaodesijie areas respectively.

A Long Drawn Battle
The relocation and remodeling of Sanhekou Village dated back all the way to 1993, when the local government reclaimed land for the construction of Beihai main road.

Peng Wei - a resident who had more than one property in the village and was affected twice during various relocations - recalled that the first round of demolition and relocation was carried out smoothly.

"Back then, all the villagers were very co-operative, because we understood the government needed land to built road for the good of society.

"But this time around, things are different; it is the real estate developer who wants our land, and they are not paying just compensation, so we refuse to move," said Peng.

Since 2000, many developers have been eyeing the land in Sanhekou village, which is located between two big commercial malls along a golden property belt. Eventually, a company named Guangdu won the rights to redevelop the village.

Villager Wu Guangyuan said property prices in nearby areas cost some 4,200 yuan per square meter, but the compensation offered to Sanhekou villagers was about 1,000 yuan per square meter.

Villagers who were dissatisfied with the offer refused to budge until a demolition exercise was forcibly carried out in early 2007.

Prior to the demolition, the Beihai municipal construction committee had obtained a court order on January 12, 2007, for the demolition exercise. The villagers challenged the court order through legal proceedings and successfully overturned the verdict on January 19.

However, the local government went ahead and published a notice stating that demolition would be carried out in 15 days in accordance to the Regulation on Dismantlement of Urban Houses.

By May, representatives from 59 households took the local government to court, alleging that the latter had violated demolition and relocation procedural code and other regulations.

Half a year later, a district court ruled against them. The villagers then filed an appeal with a higher court, which that led to the November 5 verdict in their favor.

Conflicts in the System
Beihai Municipal Construction Committee director Chen Shu'an told the EO: "The redevelopment of urban villages is bound to create conflict because it involved money and there were various parties' interests involved."

Chen said the committee was an administrative agency sandwiched between completing tasks assigned and answering to the public.

"It is difficult to satisfy the demands of everyone concerned. We have orders and are pressured from above to get the job done," he said, adding: "If we failed to complete the demolition as scheduled, we would affect the progress of other segments, such as investors' confidence, investment plans, local economic development, and town planning."

"The ultimate consequence is - the committee head will be removed," said Chen.

Wang Guanqiang, general manager of Guangdu - the developer to remodel Sanhekou Village, said the company had negotiated at length with villagers and had succumbed to their demand of providing sufficient land for them to rebuild their homes in relocated areas.

"First they want land, then they are unhappy with the cash compensation, saying it is not enough to build houses. But our offer is based on a market assessment. Many villagers have agreed with the compensation scheme, only some refused. We declined to up the offer to avoid being accused of unfairness," Wang claimed.

A local official in the Construction Committee who requested anonymity told the EO that conflicting laws and regulations had added oil to fire in the stand-off between the public and the local government.

For instance, the Property Law stated that only out of public interest could the government claim land and property currently belonging to individuals. However, under the Regulation on Dismantlement of Urban Houses, there was clear division of what constituted public and non-public interest.

According to the Regulation, as long as the government had approved a demolition plan, it could go ahead with it and could even apply for a court order to forcibly carry them out.

Unless inconsistencies between the exisiting laws and regulations were rectified, similar flip-flop legal outcomes concerning relocation and demolition - mainly challenged in court on the basis of procedural compliance rather than rights to property - would continue.