Background

• A project developer pursuing a solar power generation project entered into a land sale agreement and a basic agreement with a local village association to secure the project site, and paid a deposit thereunder.
• However, due to the village association’s failure to properly perform its obligations under the basic agreement, including cooperation in obtaining permits and licenses and procuring residents’ consent, the project developer was unable to obtain the necessary approvals, resulting in the suspension of the project.
• Despite having already incurred substantial costs, including the deposit and various project development expenses, the project ultimately failed, prompting the developer to terminate the land sale agreement and initiate litigation seeking the return of the deposit and damages equivalent to the expenditures already incurred.

 

Work Scope

• Conducted a comprehensive legal review of issues including the village association’s liability for breach of contract under the land sale agreement and the basic agreement, the validity of the village association’s resolutions, and potential tort liability of the village association
• Advised on the legal structure for contract termination and the corresponding claims for return of deposit and damages
• Developed and substantiated detailed arguments regarding causation, reasonableness, and the quantification of damages for each category of project-related expenses

 

Results and Implications

• ELPS, representing the project developer in civil litigation, successfully established not only the village association’s liability to return the deposit but also its liability for damages corresponding to the project costs incurred in reliance on the validity and performance of the contract.
• As a result, ELPS contributed to the recovery of the client’s investment and compensation for losses in a large-scale development dispute that had persisted over an extended period.