The puzzle of rural land transfer disputes, interpreted through data

Accordingly, the court confirmed that the plaintiff holds the land contractual management right to the disputed 3 mu of land; the defendant was to pay the plaintiff more than 15,000 yuan in land transfer fees for 2009 to 2013. In summary, the court ruled in accordance with the law that Xu return the contracted land to the 14 plaintiffs before October 31, 2014, and pay the 14 people the land transfer fees from July 2012 to July 2014 within 10 days from the date the judgment took effect.

Commentary: What “data” says about the puzzle of rural land transfer disputes

The poet Ai Qing once wrote: “Why do my eyes always hold tears? Because my love for this land is deep.” The land carries on the bloodline and the homeland sentiment of our nation. Following such a cultural path, rural land transfer in the rural context concerns farmers' vital interests, rural social stability and the transformation and upgrading of agriculture, and has drawn close attention from the central government and all sectors of society. A study by the Pudong New Area People's Court of Shanghai found that in recent years, as the transformation of the social and economic structure has accelerated and profound changes have taken place in rural society and the pattern of interests, rural land transfer disputes have shown a trend of frequent occurrence, in which historical problems are intertwined with real interests and policy drivers are blended with irregular operations, urgently requiring further solutions.

A tangled dispute resolved after many twists and turns

“In 1992, because the land yielded little and still required paying agricultural tax, the plaintiff refused to farm the land, and the defendant village committee signed an agreement with him providing that the right to use the plaintiff's 3 mu of land would belong to the defendant, which then leased the land together with other villagers' contracted land to a liquefied gas station.” From arbitration all the way through three rounds of dispute resolution to the second-instance court, the defendant, the Xianjin Village Committee of Pudong New Area, Shanghai, repeatedly stressed this.

The agreement referred to by the defendant was signed between it and the plaintiff, Gu. At the time, the defendant paid the plaintiff 5,468.4 yuan in compensation, and thereafter paid various fees in succession until January 2009.

“This agreement has distinct historical characteristics. In the early 1990s rural land transfer was not standardized, and the agreement between the two sides did not even specify the annual transfer fee; the contract title even used the words 'land requisition agreement'.” pointed out Jin Yujie, the judge handling the first instance of the case.

Starting in 2009, the defendant signed a new lease contract with Best Energy Development Company (the former liquefied gas station) for 3,300 sq m of land including the plaintiff's land, at a rent of 16,500 yuan per year. During this period, the plaintiff negotiated with the defendant to increase the transfer fee without success, and in September 2013 applied to the land contracting arbitration committee for arbitration. In November of that year, the arbitration ruling held that the plaintiff held the rural land contractual management right from the second round of rural land contracting in 1999, and ordered the defendant to pay the plaintiff more than 15,000 yuan in land transfer fees for the 3 mu of land from 2009 to 2013.

In December 2013, because the transfer fee supported by the arbitration committee was more than ten times less than what he claimed, Gu brought a lawsuit to the court, requesting a ruling that the plaintiff holds the contractual management right to the 3 mu of land and that the defendant return all the lease income of more than 180,000 yuan that the liquefied gas station paid to the defendant.

After trial, the court held that although the agreement was titled a land requisition agreement, it agreed with the arbitration committee's finding that it was “in substance a land transfer agreement,” that is, the plaintiff and defendant were in a land transfer relationship. As the transferee, the defendant bore the risks of the transferred land and enjoyed the operating income from the transfer; its leasing of the land to the liquefied gas station was a legal relationship between it and the liquefied gas station, and the plaintiff had known this since 1992, so even if the defendant's income exceeded the transfer fee paid to the plaintiff, it had nothing to do with the plaintiff.

As for the transfer fees the defendant did not pay from 2009 to 2013, given that the two sides had no clear agreement on the payment standard, the arbitration committee determined the amount to be more than 15,000 yuan by reference to the Pudong New Area guidance price for land transfer, and the court upheld this.

Accordingly, the court confirmed that the plaintiff holds the land contractual management right to the disputed 3 mu of land; the defendant was to pay the plaintiff more than 15,000 yuan in land transfer fees for 2009 to 2013.

The plaintiff later appealed. In August 2014, the second-instance court rejected the appeal and upheld the original judgment, also stating: “The village committee, as the user of the disputed land, has managed the disputed land and other land in a unified way and leased it out since 1992, and should rightly enjoy the income from the transfer and operation. As for that income being higher than the transfer fee paid to Gu, that was the result of negotiations between the village committee and persons outside the case, which complies with the law and is entirely reasonable.”

Unauthorized change of land use leads to prison

On May 28, 2014, the Lianmin Village Committee of Pudong New Area sued Heye Company in court, seeking to terminate the Contract for the Transfer of Contractual Management Rights and to have the land returned.

The matter goes back to 2009. In July of that year, the plaintiff transferred two parcels of village land totaling 111.1 mu to the defendant for contracted operation for planting. The two sides agreed that it must not be used for non-agricultural construction; the transfer fee was 1,300 yuan per mu, to be adjusted according to market conditions; payment was to be made before July 31 each year; and if one party failed to perform its contractual obligations for more than 1 month, the other party had the right to terminate the contract, among other terms.

But by September 2010, the defendant had subleased the parcel to Wu for use as a timber yard. At the same time, it was agreed that brick-and-tile houses must not be built at will and that only temporary buildings could be erected in the planned area. After obtaining the land, Wu began to “go all out”: erecting color steel panel houses on basic farmland, paving roads and passageways with muck, and subleasing part of the farmland to others.

According to management personnel hired by Wu, from February to July 2011, Wu rented out space to more than 30 households, and Wu and the tenants poured concrete on the floors of some panel houses. Wu admitted that “during that period the management department and Xu, the legal representative of Heye Company, once stopped it.”

In October 2012, the procuratorate instituted a public prosecution in court on the grounds that Wu was suspected of the crime of illegally occupying agricultural land, accusing Wu of violating land management regulations, illegally occupying agricultural land, changing the use of the occupied land, and causing extensive damage to agricultural land.

In fact, according to a survey by the Shanghai Resource and Environment Supervision and Testing Center of the Ministry of Land and Resources, the basic farmland occupied by Wu amounted to about 39.1 mu, exceeding the 5 mu threshold for prosecution. The surface soil in the areas covered by buildings was consolidated and mixed with crushed stone; the surface soil in the road areas was compacted, the effective topsoil was lost, and the soil texture changed; the natural land quality dropped from grade 15 to grade 7.

The court held that after renting the land, Wu carried out infrastructure construction without authorization, and after subleasing it, allowed others to build houses and pave sites. The relevant departments and Xu had once stopped these acts, so Wu should have clearly known the nature of the land involved and should also bear responsibility for carrying out infrastructure construction without authorization and for allowing others to damage the land after subleasing it.

In January 2013, in view of circumstances such as Wu turning himself in, the court sentenced him to one year in prison and a fine of 20,000 yuan for the crime of illegally occupying agricultural land.

By the time of the court hearing in October 2014 in the case of the Lianmin Village Committee v. Heye Company, the village committee insisted on taking back the parcel, saying that “Heye Company subleased the land to others without authorization and also failed to pay the transfer fee from 2013 to the present.”

After trial, the court held that Heye Company subleased the transferred land without authorization, causing serious damage to the planting conditions, and failed to pay the use fee as agreed, breaching the contract, and therefore ruled in accordance with the law that the contract between the two sides be terminated and that Heye Company clear the added items and return the land within 10 days from the date the judgment took effect.

14 villagers seek reasonable consideration

Yan, a villager of Wanxing Village in Pudong New Area, had 0.25 mu of contracted land. In 1999, Yan and Tang and 12 other land contracting right holders “strung” their respective parcels together, totaling 3.71 mu of land, and gave it to Xu to farm. Before the agricultural tax was abolished in 2003, the agricultural tax they should have borne was all paid by Xu.

Because they were all fellow villagers and trusted one another, the two sides did not sign a written agreement as required by the legal provisions on land management right transfer.

In 2003, national agricultural policy underwent a major change, beginning the exemption from levying agricultural taxes and fees. It was from then on that Xu continued to farm the disputed land, but no longer bore any agricultural tax or fee costs, nor paid Yan and the others any fees.

At the end of 2013, mediation by the village committee over taking back the land and the land rent failed. In August 2014, Yan and 13 others separately sued in court, demanding that the defendant Xu return their respective parcels before October 31 and pay rent calculated at 2,000 yuan per mu for the 2 years from July 2012 to July 2014.