Machinery Supply Contract Dispute – CNY 69,194.30 Judgment
A dispute over unpaid machinery parts led to a court judgment ordering a can manufacturing company to pay CNY 69,194.30 to a machinery supplier. The court found that the buyer had received all goods but failed to pay the full amount. The case was heard in Eastern China City and decided in favor of the plaintiff.
The plaintiff, Mr. Li’s Machinery Co., Ltd., supplied vertical pipes to the defendant, Mr. Wang’s Can Manufacturing Co., Ltd., over a period from August 2010 to October 2011. According to the plaintiff, orders were typically placed by telephone or fax, followed by delivery notes signed upon receipt. Invoices were issued at the end of each month, and payments were made irregularly and in varying amounts. The total value of goods supplied during the period was CNY 405,847.78, of which the defendant paid only CNY 336,653.48. The plaintiff demanded payment of the remaining CNY 69,194.30 through multiple requests between October and December 2011, but the defendant refused. The plaintiff then filed a lawsuit.
At the hearing, the plaintiff submitted eighteen special VAT invoices together with corresponding delivery notes to prove the total sales amount. The plaintiff also produced twelve payment records showing the defendant had paid CNY 336,653.48. The defendant did not appear in court or submit any written defense. The court, on its own motion, obtained certification records from the local tax authority in Eastern China City. These records showed that seventeen of the eighteen invoices had been certified by the defendant for tax deduction purposes. One invoice, numbered 02108727, had not been certified. The court reviewed the evidence and found that despite the absence of certification, that invoice matched a delivery note with the same recipient signature as other delivery notes.
The court held that the defendant, by certifying seventeen of the VAT invoices with the tax authority, had effectively confirmed receipt of the goods listed in those invoices. The court also noted that the defendant had paid most of the invoiced amounts, further supporting the conclusion that the goods were received. Regarding the uncertified invoice (no. 02108727), which corresponded to a delivery on September 21, 2010 valued at CNY 12,500, the court pointed out that the defendant made a payment of CNY 13,300 on September 30, 2010, shortly after the delivery. The signatory on that delivery note was the same as on other delivery notes. The court therefore found that the defendant had also received the goods under that delivery. The total outstanding amount was confirmed as CNY 69,194.30.
The court applied provisions of the Contract Law of the People’s Republic of China, which require that a legally formed contract be honored and that the buyer pay the price for goods received. The court noted that the sales relationship between the parties was valid, the content was lawful, and both parties had expressed genuine intent. The defendant’s failure to attend the hearing was treated as a waiver of the right to contest the plaintiff’s claims. The court concluded that the plaintiff’s demand for payment was justified and ordered the defendant to pay the full amount within ten days of the judgment taking effect. The defendant was also ordered to bear the court costs and to pay double the interest on the delayed payment if payment was not made on time.
This case underscores the importance of maintaining clear documentary evidence in commercial supply transactions. The court’s reliance on tax certification records and payment patterns helped establish the receipt of goods even where one invoice was not formally certified. For businesses, the judgment demonstrates that consistent delivery notes, matched with payment behavior, can serve as strong proof in contract disputes. The defendant’s failure to appear did not prevent a ruling in favor of the plaintiff. The outcome reinforces the principle that buyers must pay for goods actually received, and that silence in court does not protect against liability.
Disclaimer: This article is for informational purposes only and does not constitute legal advice.