Court Orders Payment of CNY 91,326 in Auto Parts Supply Dispute
In this case, a factory based in Eastern China City brought a breach of contract claim against a company in the same region for unpaid delivery of auto parts. The plaintiff sought payment of CNY 91,326 for goods supplied between 2009 and early 2012, plus interest on the overdue amount. The court ruled in favor of the plaintiff, ordering the defendant to pay the full principal and interest from the date of lawsuit filing.
The dispute arose from a continuing business relationship that began in 2009, when the defendant started purchasing wiring harnesses and control boxes from the plaintiff. On January 12, 2012, the parties conducted a financial settlement, and the defendant acknowledged an outstanding balance of CNY 91,326. Despite repeated demands by the plaintiff, the defendant failed to make payment. The plaintiff then filed a lawsuit on March 27, 2012, requesting the court to order immediate repayment plus interest calculated from the filing date at the benchmark lending rate of the People’s Bank of China until full payment.
At the court hearing on April 12, 2012, the plaintiff’s attorney appeared and presented key evidence. The plaintiff submitted a detailed accounts payable ledger showing the defendant’s outstanding debt of CNY 91,326. The defendant, having been properly served with the complaint and summons, did not appear in court and submitted no written defense. The court noted that the defendant had waived its rights to cross-examine the evidence and to present a counterargument.
The court found that the evidence provided by the plaintiff was legally obtained, truthful, and relevant to the case. The ledger was accepted as valid proof of the debt. On this basis, the court determined that the facts as alleged by the plaintiff were fully established. The court held that a valid purchase and sale contract existed between the parties, entered into voluntarily with genuine mutual intent, and that its terms did not violate any mandatory legal prohibitions. Therefore, the contract was legally binding.
According to relevant law, specifically Article 107 of the Contract Law concerning liability for breach and Article 159 regarding the buyer’s obligation to pay the price, the defendant was obligated to settle the outstanding amount. The evidence showed that the defendant had not performed its payment duty. The court reasoned that the plaintiff’s request was legally justified. The court also applied Article 130 of the Civil Procedure Law, which governs default judgments when a defendant fails to appear without valid reason. The court ordered the defendant to pay within ten days of the judgment becoming effective, with interest accruing from March 27, 2012, at the central bank’s benchmark lending rate until full satisfaction.
This case illustrates how Chinese courts handle straightforward commercial debt disputes where one party fails to respond to legal proceedings. The judgment reinforces the principle that a signed settlement agreement or acknowledged debt creates a clear obligation to pay. For businesses, the ruling underscores the importance of keeping accurate payment records and the value of a documented accounting ledger as evidence. The court also imposed court costs of CNY 1,220 on the defendant, and warned that late payment would incur double interest under the Civil Procedure Law. Parties in similar situations should note that ignoring a lawsuit does not prevent a default judgment.
Disclaimer: This article is for informational purposes only and does not constitute legal advice.