Zhizming Lawyers Achieve a Dramatic Reversal on Appeal, Helping Enterprise Recover 28 Million in Losses from a Losing Battle
In May 2011, Wupeng Company and Fangfang Company entered into a Framework Agreement, agreeing to jointly develop an old city renovation project. The funding for the old city renovation project was to be borne by Wupeng Company within the agreed scope, and Fangfang Company was to cooperate with a third party, Pingwu Branch, in applying to the government for approval. Fangfang Company successively obtained a total of 28 million yuan from Wupeng Company on the grounds of seeking project approval. Thereafter, Fangfang Company demanded, under various pretexts, that Wupeng Company inject additional investment amounting to over one hundred million yuan, which Wupeng Company naturally did not readily agree to given the unreasonable nature of the demand. In January 2017, on the grounds that Wupeng Company had failed to inject additional project funds, resulting in a break in the funding chain, Fangfang Company issued a Notice of Termination of Cooperation to Wupeng Company, terminating the Framework Agreement, which would inevitably cause enormous losses to Wupeng Company.
Wu Peng Company subsequently engaged Law Firm A to file a lawsuit, requesting the court to rule that the termination of the contract by Fangfang Company through its "Notice of Termination of Cooperation" was invalid. The court of first instance held that Wu Peng Company failed to prove that the act of Fangfang Company in issuing the "Notice of Termination of Cooperation" was invalid, and therefore ruled against Wu Peng Company's claims.
After losing the case in the court of first instance, Wupeng Company was extremely anxious. If Fangfang Company's contract termination took effect, it would mean that their company's huge investment of 28 million yuan would go up in flames. Therefore, Wupeng Company had to overturn the adverse judgment. Subsequently, Wupeng Company consulted multiple law firms and, after extensive inquiries, learned that the Zhi Ming Literary and Artistic Rights Litigation Team of Guangdong Zhi Ming Law Firm had the ability to breathe life back into difficult and complex major cases. After an in-person meeting, they firmly entrusted the Zhi Ming Literary and Artistic Rights Litigation Team to represent them in filing the appeal.
After accepting the commission from Wupeng Company, Cao Guanghui, a lawyer and director of the Zhiming Literary and Artistic Rights Protection Litigation Team, conducted an in-depth analysis of the first-instance judgment and the existing evidence. First, they believed that the first-instance judgment erred in the application of law. In the first instance, the request filed by Wupeng Company was to confirm that Fangfang Company's act of terminating the contract by issuing the "Letter of Termination of Cooperation" was invalid, yet the first-instance judgment instead ruled on whether the issuance of the "Letter of Termination of Cooperation" constituted a civil act. This was clearly a ruling beyond the claims and violated procedural rules. Second, the first-instance court's determination that Wupeng Company failed to submit evidence proving that Fangfang Company's act of terminating the contract by issuing the "Letter of Termination of Cooperation" was invalid constituted an error in fact finding.
In court, the appellee Fangfang Company put forward two grounds for terminating the contract: first, the capital chain had been broken for one month; second, the cooperation agreement between Fangfang Company and the third party, Pingwu Company, had expired, and there was no longer a basis for cooperation. The Zhiming Literary and Artistic Rights Protection Litigation Team refuted this forcefully, fully demonstrating with the existing evidence that: first, Wupeng Company had already strictly fulfilled its due obligations, and the capital chain breakage claimed by Fangfang Company did not exist, nor did it meet the conditions for contractual or statutory termination. Second, the cooperation period between Fangfang Company and Pingwu Company had been renewed to 2021, and there was no circumstance where the contract could not be performed as stated in the "Termination of Cooperation Letter."
Finally, the court of second instance adopted the opinions of the Zhiming Literary and Artistic Rights Protection Litigation Team and ruled in favor of Wupeng Company, determining that Fangfang Company's act of sending the "Termination Notice" to dissolve the contract was invalid. Wupeng Company survived against all odds, completely reversing the first-instance defeat, and the 28 million yuan investment was saved from going down the drain.
