Court Orders Payment of CNY 70,000 in Partnership Dispute

The dispute arose from the dissolution of a partnership formed in 2006 to operate a stone processing plant. After the partnership ended, the defendant issued a promissory note to the plaintiff for a total of CNY 130,000, payable in two installments. The first installment of CNY 60,000 went unpaid, leading to a prior court judgment. When the second installment of CNY 70,000 also remained unpaid after repeated demands, the plaintiff brought a new lawsuit seeking repayment plus interest.

The plaintiff, Mr. Zhang, and the defendant, Mr. Li, together with a third party named Mr. Rong, entered into an oral partnership in early 2006 to run a stone processing facility. The partnership dissolved later that year. On November 16, 2006, after financial settlement, Mr. Li signed a promissory note before three witnesses, acknowledging a debt of CNY 130,000 to Mr. Zhang. The note specified that CNY 60,000 would be repaid by a date in early 2008 and the remaining CNY 70,000 by the end of 2008. The first payment was not made on time, so Mr. Zhang sued and obtained a judgment ordering payment of the CNY 60,000 plus interest. That judgment was already in enforcement proceedings. The CNY 70,000 second installment also fell due but was never paid, despite multiple requests.

The court accepted the case on December 22, 2011, and applied summary procedure with a single presiding judge. A public hearing was held on March 1, 2012. The defendant was properly served with a summons but did not appear in court and offered no explanation. The plaintiff attended and presented three pieces of evidence: his identity documents to establish standing, a copy of the earlier civil judgment confirming the first installment debt, and the original promissory note signed by the defendant. The court reviewed and admitted all evidence. Because the defendant failed to appear, the hearing proceeded as a default proceeding.

The court found that the defendant’s debt was clearly proven by the promissory note and the supporting testimony. The defendant did not contest the claim or provide any counter-evidence. Accordingly, the court ruled that the defendant must pay the remaining principal of CNY 70,000. The court also ordered the defendant to pay interest on that amount at a monthly rate of 10 per thousand (equivalent to 1% per month) calculated from November 16, 2006, the date the note was signed, until full repayment. The court further held that if the defendant failed to pay within ten days of the judgment becoming effective, additional interest for delayed performance would apply as mandated by civil procedure law.

The court based its decision on several provisions of Chinese civil law. Under the General Principles of Civil Law, a lawful debt must be honored, and creditors have the right to demand performance. The promissory note constituted a clear contractual obligation. Although the defendant was absent, the law permits a default judgment when a party fails to appear without justification. The interest rate specified in the note was found to be lawful and enforceable. The court also cited the Contract Law regarding the transfer of rights, though that provision was not directly relevant to the core