On June 26th, 1995, Company W in N province of China signed a compensation trade contract with Company S in F country. According to the contract, Company S shall provide Company W with complete tomato sauce processing equipment produced by Company K in Country Y, with a production capacity of 20 tons of raw materials per hour, and provide spare parts, testing instruments and equipment installation and technical services for the equipment for two years. The latest date for the offshore shipment of the main parts of the equipment is not later than May 20th 1995, and the remaining parts will be airlifted to Beijing Airport before June 1995. The total contract amount is US$ 3.3 million (including US$ 2.9 million for equipment, and US$ 400,000 1995 paid by Company S to Company W before the end of July). W company will repay all the money in three years with the ketchup produced by this equipment. Approved by the Department of Foreign Economic Cooperation of N Province, this contract came into effect on March 1995.
Claim and reasons of Applicant W Company.
After the signing of the agreement between the two parties came into effect, W Company actively carried out a series of work such as building factories and arranging tomato planting. In order to put 65438 into production in July 1995, company w built the factory building and supporting facilities, purchased domestic supporting equipment, planted 9200 mu of tomatoes (13500 mu in 995,15700 mu in 996), and sent technicians, managers and post workers to study and train. At the same time, from March 195 to April 196, company w also paid RMB 865,438+million and USD 654,380+030,000 to the respondent.
However, within the time limit stipulated in the contract, S company neither shipped any equipment nor paid any advance payment for starting production, and its breach of contract caused huge economic losses to W company. ..
In order to make up for the losses of W Company, and more importantly, out of good wishes for friendly cooperation, the two parties signed a memorandum and supplementary agreement on August 1995. According to the memorandum, in order to make up for the economic loss of tomato planting by W company's growers, S company will pay W company 200,000 yuan before the end of19951. The supplementary agreement stipulates that S company will ship the equipment before the end of September 1995.
However, Company S still failed to fulfill the above obligations, neither paying 200,000 yuan nor shipping equipment, which caused the economic loss of Company W to continue to expand. The two sides held urgent consultations on February 2 1995. In order to ensure that the production of 1996 can be carried out as scheduled, both parties clearly stipulated in the supplementary agreement that S company will ship tomato sauce equipment out of Hong Kong on1February/996 15.
S company has not shipped the equipment after the deadline. However, tomato production is high. The two parties signed the equipment delivery agreement again on March 8, 1996/KLOC-0. According to the agreement, S company must fly the whole set of equipment (including laboratory instruments and equipment accessories) of tomato sauce production line to Beijing Airport before March 27th. 1996, S company guarantees a refund. After the agreement was signed, W Company made all preparations for delivery and installation. In order to pick up the goods in time, the applicant arranged 14 domestic trucks in front of airport B according to the number of containers. However, S company has not shipped any equipment. On March 28th 17, Company W called Company S: "If we can't arrive at the airport in City B before March 3rd1,we will sue your company for compensation.
At the beginning of April, 1996, the two sides discussed the problems in the performance of the contract. At that time, it was widely rumored that the country would no longer implement the preferential policy of reducing or exempting tariffs on imported equipment for compensation trade projects. On the premise that the tariff of company S is borne by it and company W is put into trial operation in July, both parties plan to continue to perform the original contract by establishing a joint venture. However, the relevant agreements and documents of joint venture have not been signed for approval, and the deadline for the state to implement preferential tariff reduction policies for imported equipment for compensation trade projects has been determined as1the end of 996. Therefore, the proposed joint venture does not actually replace the original compensation trade contract.
What is of practical significance to the continued performance of the contract is the provisions on the arrival date of equipment in the Agreement on Changing Compensation Trade into Sino-foreign Joint Ventures and the Agreement on Purchasing Equipment by Joint Ventures on April 5. In the agreement of changing compensation trade into Sino-foreign joint venture, it is stipulated that S company should complete the procurement and shipment of equipment in late April. According to the joint venture equipment purchase agreement, the goods will arrive at China T Port in two batches: the first batch will arrive on May 20th, 1996, and the second batch will arrive on June 20th, not too late.
According to the agreement, W Company continued the tomato planting and ketchup production preparation of 1996. However, on April 27th, Company W received the fax written by Company S as "April 19" and the fax sent by the equipment manufacturer to the defendant on April 18 and April 26th, informing that the shipment of the equipment may be delayed, the earliest flight can only arrive after June 29th, and the main part of the equipment "evaporation pot" may be resold, which is not guaranteed. Company W immediately replied by fax that it refused: "We can't accept any arrangement to ship the equipment later than May 10." And clearly told company S: "Please pay attention to your company: If the installation and production of our company are affected because the equipment can't arrive in time, our company will not do it again, but demand to return the dunning and recover the losses."
On May 2nd, Company S told Company W by fax that they had "a lot of equipment problems" ... Please don't carry out this year's tomato planting plan. This means that not only 1996' s large-scale tomato planting and the tomato purchase contract signed with the growers have to be compensated, but also the work plan of W Company 1996' s tomato sauce production will fail. This is unacceptable to W company, which clearly expressed its attitude in the fax on May 3, and stressed that "remind you again that if the equipment fails to arrive on time, our company will lodge a claim with you."
Subsequently, Company W was informed that the main parts of tomato sauce production equipment had been resold by the manufacturer, and reproduction would take a long time and cycle, so it could not be put into production in 1996. Because company S didn't perform the contract, it caused huge economic losses to company W. /kloc-in may, 0/7, company w faxed to company s: "in view of the above situation, our company has to decide to terminate the agreement relationship between us, and ask your company to refund all prepaid equipment funds and compensate us for economic losses."
S company turned a deaf ear to W company's huge economic losses and the request to terminate the contract, and unilaterally changed the equipment shipment date to1the end of 996 in the fax on May 20, in order to ship a small amount of equipment that is not practical for production. This is a unilateral act of artificially expanding losses. W immediately informed S company that even if S company shipped the equipment, W company would not pick up the goods. Since1May, 1996 17, both parties have only discussed the remaining issues of contract termination, and there is no question of continuing to perform the contract.
Regarding the clear attitude of W Company, the Respondent continued to go its own way. In the fax of June 3rd, Company S asked Company W to make it clear in writing, "Otherwise, some equipment will be shipped as planned. Company W will immediately fax the Letter on Reiterating the Termination of the Compensation Trade Contract to Company S, reiterating that the contracts signed by both parties will be terminated from 1,1May 1996 17. 2. Ask for a refund of the advance payment we paid you. 3. claim compensation for our related investment losses. "
Since then, Company S has violated the general rules of international trade and unilaterally artificially expanded its losses. In mid-July and early August, Company W was informed that Company S shipped some goods on June 17 and July 18, respectively, and the value of these two shipments was lower than 15% of the equipment price. In the project, it belongs to non-main parts such as brackets and bolts, and it is impossible to form production capacity at all, so it is naturally rejected by W company.
The huge economic losses suffered by company W are caused by the failure of company S to fulfill the compensation trade contract. Therefore, Company W requests the arbitration tribunal to decide to terminate the compensation trade contract between the two parties; It is decided that Company S will return the equipment prepaid by Company W with RMB 86.5438+10,000 and USD1.3,000, and compensate the bank interest for the same period.
S company was awarded compensation for economic losses of W company. The total losses include: (65,438+0) equipment advance payment of RMB 8,654.38+million and USD 654.38+0.3 million; (2) The interest of the bank's advance payment for equipment in the same period is RMB 65,438+065,438+075,000 (as of February 65,438+0996), and the arbitration tribunal is requested to make an award according to the actual interest; (3) The loss of factory building installation is 4.35 million yuan according to the actual amount; (4) The tomato planting loss is 565,438+043,000 yuan according to the actual amount. (5) The arbitration fee in this case is RMB 253, 580 yuan.
Statement and reasons of defendant s company.
After China International Trade Arbitration Commission accepted it, the secretariat of the Arbitration Commission sent the notice of arbitration, the arbitration application and its attachments, the arbitration rules and the roster of arbitrators 1996 to S Company by express mail on August 20th according to the legal address of S Company in H provided in the arbitration application of W Company. On August 22nd, 1996, the courier company informed the arbitration commission that H's company was closed down and the documents were returned.
1September 5, 1996, the secretariat of the arbitration commission sent the notice of arbitration, the arbitration application and its annexes, the arbitration rules and the roster of arbitrators to W Company by registered mail. However, Company S failed to appoint an arbitrator and submit the defense and counterclaim materials within the time limit stipulated in the arbitration rules.
1996 10.30, the secretariat of the arbitration commission still delivered a copy of the notice of arbitration, the arbitration application and its annexes, the arbitration rules and the roster of arbitrators to company S according to the address of the office in city B, and requested company S to submit written materials according to the arbitration rules. If it is not submitted within the time limit, the Arbitration Commission will continue the arbitration procedure. However, Company S has not submitted any written materials.
Company W appointed an arbitrator in accordance with the Arbitration Rules. As Company S failed to appoint or entrust the Chairman of the Arbitration Commission to appoint an arbitrator within the prescribed time limit, the Chairman of the Arbitration Commission appointed an arbitrator for it according to Article 26 of the Arbitration Rules. The parties fail to appoint or entrust the chairman of the Arbitration Commission to appoint the presiding arbitrator within the prescribed time limit. Three arbitrators formed an arbitration tribunal on199665438+February 17 to hear the case.
1996 12 17. the secretariat of the arbitration commission entrusts e law firm to serve the notice of hearing on s company.
1997 February 18, the arbitration tribunal heard the case as scheduled. Company W sent an arbitration agent to participate in the trial, while Company S did not send a representative or an arbitration agent to participate in the trial, nor did it submit any written materials. According to Article 42 of the Arbitration Rules, "if one party fails to appear in court, the arbitration tribunal may award by default". At the hearing,
1February 20, 1997, the secretariat of the arbitration commission entrusted e law firm to send a letter to S company, informing S company to hold a court session, asking it to start its work in writing before1March 1997 14 if it has any opinions or objections to W company's arbitration application and its annexes, or asking the arbitration tribunal to hold a second court session on this case. If it fails to do so within the time limit, the arbitration tribunal will no longer accept expired materials.
On March 1997 and March 1 1, the secretariat of the arbitration commission entrusted e law firm to send the supplementary opinions and attachments submitted by company w after the hearing to the respondent, requesting company s to submit its opinions or objections in writing before April 4. After the expiration of the time limit, the arbitration tribunal will no longer accept the expired materials, and will make an award based on the existing written materials and the facts ascertained in the hearing. However, Company S never submitted any written materials.
[Opinion of the arbitral tribunal]
About the applicable law
The parties to this case agreed in Article 12 of the Compensation Trade Contract that the disputes between the two parties should be settled according to the laws of People's Republic of China (PRC), so the arbitration in this case is governed by the laws of People's Republic of China (PRC).
On the performance of the contract
The arbitration tribunal pointed out that the contract in this case is a compensation trade contract, and there are two other contracts besides the compensation trade contract: an equipment import contract and a product resale contract.
According to Article 10 of the compensation trade contract, the equipment import contract is its annex A and the product sales contract is its annex D, which together with other annexes constitute the integrity of the contract. The compensation trade contract is fully effective only if it includes all the annexes. Article 1.3 of the compensation trade contract stipulates: "Annexes A, B, C, D, F and G are irrevocable and have the same effect." Therefore, the arbitral tribunal found that the so-called performance of the contract in this case includes the performance of the equipment import contract as A and the product resale contract as Annex D. ..
The arbitral tribunal noted that Article 2, paragraph 2, of the Equipment Import Contract in Annex A of this case clearly stipulates that "the main parts of the equipment shall be shipped offshore no later than1May 20, 1995, and the remaining parts will be airlifted to Hong Kong before1June 1995.
The arbitral tribunal also noted that nearly one year after the delivery date stipulated in the contract, Company S still expressed to Company W that "unfortunately, we have encountered great trouble with the equipment problem in Europe". That is to say, although company W has given company S extra time to perform the contract many times, company S still cannot perform it, which constitutes a fundamental breach of contract. According to the provisions of the first, second and second paragraphs of Article 29 of People's Republic of China (PRC) Foreign Economic Contract Law, W Company has the right to terminate the contract. In May of 17 and June 6, 1996, Company W informed Company S in writing that "the compensation trade contract signed by both parties shall be terminated as of May of 196+07" was legal, and the arbitration tribunal determined that these two written notices were valid.
On the Arbitration Request of W Company
(1) The arbitration tribunal supported the 1 arbitration request of W Company, and the arbitration tribunal determined that the compensation trade contract was terminated; This contract, together with its annexes including equipment import contract and product sales contract, was terminated on May, 2007 1996.
(2) The arbitral tribunal reviewed the documents, materials and evidence submitted by W Company, and proved that W Company did pay the equipment payment in advance to the respondent in different months, including RMB 8 100000 and USD 130000. Because S Company failed to fulfill its equipment delivery obligations, W Company's second arbitration request should be supported. The arbitration tribunal found that Company S must pay RMB 8 100000 and USD 130000 to Company W within the time limit stipulated in this award.
(3) The arbitral tribunal also found that the respondent should pay the interest on the above sum to the applicant. The arbitral tribunal reviewed the "basis for interest calculation" submitted by W Company and found it reasonable. The applicant only calculated it to199665438+February, and the arbitral tribunal thought that the request of company W to "request the arbitral tribunal to award interest according to the actual amount incurred" should be considered, and the interest should be calculated to the date of the award of this case, namely1July 1997 10 (65438). 100,000+ 130,000×0.0 1× 6.3= 1,753,277)。 The arbitration tribunal found that the respondent must pay the applicant interest of 65,438 yuan+0,753,277 yuan within the time limit stipulated in the award of this case.
Other economic losses of W Company
The arbitral tribunal examined the materials submitted by W Company about its economic losses, and the arbitral tribunal noted that there were two economic losses. The opinions of the arbitral tribunal are as follows:
(1) Building and installation loss of the factory building: 4.35 million yuan, including building and installation works, wages, travel expenses, design fees, training fees, foreign trade agency fees and others. The arbitration tribunal held that the above expenses, except training fees and foreign trade agency fees, should be converted into the fixed assets of company W. These two fixed assets are owned by company W, so they are not losses. As for the training fee, according to Article 5 of the compensation trade contract, S Company shall provide training. The training fee proposed by W Company was generated by asking F Canned Food Factory for training, which was beyond the scope of the contract in this case and was not supported by the arbitration tribunal. Regarding the foreign trade agency fee, the arbitration tribunal will not support the applicant's failure to provide documents or other evidence.
(2) tomato planting loss: 5,000 yuan 143.000 yuan, including seeds, plastic film, curtains, chemical fertilizer, baskets, labor costs, others and compensation fees. The arbitration tribunal examined the relevant documents, documents and evidence submitted by W Company, and concluded that these losses were indeed caused by S Company's failure to pay for the equipment on time. S company should pay compensation, and the arbitration tribunal supports W company's arbitration request.
(3) Undertaking of arbitration fees. The arbitration tribunal held that the respondent's failure to perform the contract was a fundamental breach of contract and should bear the arbitration expenses of this case.
[arbitral award]
Terminate the compensation trade contract; This contract, together with its annexes including equipment import contract and product sales contract, was terminated on May 2006 1996 and June 2007 17.
Company S shall pay Company W RMB 8 100000 and USD 130000. Company S should pay Company W 65438 yuan +0753277 yuan, and Company S should pay Company W 565438 yuan +043000 yuan as compensation for economic losses. The arbitration fee in this case is 3765438 yuan +0006 yuan, all of which shall be borne by S company.
For all the above projects, Company S should pay Company W a total of RMB 65,438+05,367,283 and USD 65,438+030,000, which must be paid by Company S before August 25th, 65,438+0997. If it is overdue, interest at an annual rate of 8% will be charged.
[Claim Guide]
There are two points worthy of our attention in the compensation trade contract claim.
What are the rights and obligations of both parties in the compensation trade contract? This is related to the nature and characteristics of compensation trade contracts.
Compensation trade is a special trade mode in international economy and trade, in which one party provides equipment (including machinery and equipment, technology, necessary raw materials and services) to the other party. In a certain period of time, the repayment of products or income obtained by equipment importers with imported equipment is the exchange of equipment with products or income obtained by using equipment; Its "repayment" is gradually completed after obtaining the equipment for a certain period of time, that is, it has the nature of deferred payment; The equipment obtained in the way of compensation trade belongs to the importer, and after the products used to repay the equipment are transferred to the equipment seller, the equipment exporter obtains the ownership.
It should be said that compensation trade is less risky and more lagging for equipment importing countries, so it is widely used in third world countries. After the compensation trade contract signed by both parties comes into effect, the equipment exporter (company S in this case) has the obligation to provide equipment to the equipment importer (company W in this case). The basic nature of the compensation trade contract determines that W company does not need to pay for the imported equipment in money, but repays the products produced by these equipment in batches. In the contract approved by the Department of Foreign Economic Cooperation of N Province, "tomato sauce" is used as the compensation product, and because of the nature of deferred payment in the compensation trade contract, company W does not need to pay cash to company S before the equipment arrives (even before the equipment produces products). However, no performance at all and S Company repeatedly asked W Company to pay cash to fulfill its obligations under this contract, forcing W Company to pay cash of RMB 86,543,800+and USD 65,438,800+03,000 respectively.
In the case that W Company didn't get any equipment, S Company repeatedly made the applicant pay a huge amount of cash to transport the equipment as a prerequisite. What's more, after receiving the huge cash from W company, S company did not pay the equipment manufacturer, which caused the manufacturer to refuse to ship the equipment many times, cancel the air transportation and resell the main parts of the equipment, which eventually led to the failure to perform the contract and caused the applicant to suffer huge economic losses.
Therefore, the arbitration tribunal in this case made a fair judgment requiring S company to bear all liabilities for breach of contract and compensate W company for its economic losses, thus safeguarding the legitimate rights and interests of W company.
What do you think of the "ignoring" way adopted by the respondents? Or can this method be used to effectively handle claims?
In the settlement of international economic and trade disputes, one party often takes "ignoring" as a way to treat claims, resulting in default arbitration or default trial. It is usually the respondent or the defendant who is absent, especially when the plaintiff advocates arbitration or litigation for his debts. The plaintiff's absence only occurs when faced with a counterclaim of a larger amount. The main reason for the defendant's absence was that when he was a leather bag company, there were also some powerful big companies whose legal address was not a signatory to the new york Convention 1958, which would cause difficulties in implementation.
In fact, "absence" is not an effective or positive way. No matter in arbitration or trial, the absence of the defendant can't prevent the legal proceedings from going on as usual, but it will lead to the arbitration or trial being conducted and completed according to the materials and evidence provided by the party present, and there is no disproof and defense of the absent party at all, thus making a one-sided ruling or judgment that is unfavorable to the absent party. As one expert said: "But the arbitrator can't help it, and he can't come up with some defenses out of thin air to protect the absent parties."
This case proves that the absence of the respondent company S did not terminate the normal trial of this case, and the arbitration tribunal also made a fair ruling (including not supporting part of the arbitration request of company W). For an arbitrator or arbitral tribunal, it will never stop hearing and make an award because the defendant ignores it. As an arbitrator, it is important to give the parties (especially the losing party) proper notice and the losing party an opportunity to defend itself. Just like the arbitration hearing in this case, the secretariat of the Arbitration Commission has repeatedly notified Company S to adopt legal address, office address, express delivery, express delivery by law firm, etc. And in the notice, not only the defendant company was given enough time to reply, but also the deadline for final reply or submission of evidence materials was emphasized. S company's rights were guaranteed both in procedure and in entity, and finally an award was made that it would not be implemented due to the reasons stipulated in the new york Convention.
It is worth noting that in recent years, some state-owned companies often "absent" from arbitration or trial, especially when they have to go to foreign countries or Hong Kong for arbitration according to the arbitration agreement, and most of them have won the losing arbitration award. As China is a signatory to the new york Convention, there is no longer any case of excessive claim amount before the award is obtained, because according to the Convention, the China court cannot discuss the contents of the arbitral award. Therefore, in the face of claims, the correct way is to actively respond to the lawsuit, argue according to reason and defend according to law. Even counterclaim, only in this way can we effectively safeguard our legitimate rights and interests.