CNY 86,000 Judgment for Unpaid Generator Supplies
Mr. Li brought a lawsuit against Mr. Wang over unpaid invoices for the supply of energy-saving generators and air compressors. The court found that Mr. Wang owed a total of CNY 86,000 in principal plus CNY 7,377 in interest. The court ruled in favor of Mr. Li, ordering Mr. Wang to pay the full amount within ten days.
The parties had an ongoing business relationship where Mr. Li supplied electrical equipment to Mr. Wang. After accounting, Mr. Wang owed CNY 120,000. On January 9, 2010, the parties agreed that Mr. Wang would transfer a Santana car worth CNY 60,000 to offset part of the debt. Mr. Wang then wrote an IOU for the remaining CNY 60,000. Later, on March 11 and March 28, 2010, Mr. Li supplied two generators for CNY 59,000 and one generator for CNY 32,000. Mr. Wang signed the delivery lists. He made partial payments of CNY 50,000 in March 2010 and CNY 15,000 in July 2010, leaving CNY 26,000 unpaid. Combined with the earlier balance, the total unpaid amount was CNY 86,000. Mr. Li sued for that principal plus interest calculated at the bank deposit rate of 4.4 percent from the purchase dates until the lawsuit filing.
At the hearing, Mr. Wang did not appear despite proper notice. Mr. Li’s legal representative attended. The court reviewed the evidence, which included Mr. Li’s statements, the IOU written by Mr. Wang, and two delivery lists signed by Mr. Wang. The court accepted this evidence as sufficient to prove the debt.
The court held that contracts must be performed according to their terms and that payment for goods must be made promptly. The court found that Mr. Li had delivered the goods and that Mr. Wang had accepted them. The evidence clearly showed that Mr. Wang still owed CNY 86,000. The court further found that the interest claimed—calculated from the respective purchase dates to the filing date at the one-year bank deposit rate of 4.4 percent—was reasonable and did not violate any law. The court therefore granted both the principal and interest claims.
Under relevant Chinese contract law, particularly Article 161 of the Contract Law, a buyer must pay for goods at the agreed time or, if no time is agreed, upon receipt. Here, the defendant acknowledged the debt in writing and made partial payments, confirming the obligation. The court also noted that even if Mr. Wang faced difficulties because others owed him money, that did not excuse his failure to pay Mr. Li. The interest award was based on the bank deposit rate, which is a common measure for commercial disputes where no higher agreed interest rate exists.
This case illustrates the importance of maintaining clear written records of debts and partial payments in commercial transactions. The plaintiff’s IOU and signed delivery lists were decisive. The court issued a default judgment because the defendant failed to appear. The judgment includes a mandatory penalty for delayed payment at double the ordinary rate. Businesses in similar situations should ensure they document all transactions and consider seeking legal advice early to protect their rights.
Disclaimer: This article is for informational purposes only and does not constitute legal advice.