Analysis of the case of representing Xin in suing Gu for a debt dispute

【Lead Counsel: Wang Tengfeng】I. Case Overview

Plaintiff Xin XX (female) and defendant Gu XX began a relationship in May 1995 and cohabited. Two years later, the defendant became involved with another person, causing significant physical and emotional harm to the plaintiff. To resolve the breakup, the defendant agreed to compensate the plaintiff RMB 200,000 as "youth compensation." Claiming a lack of cash at the time, the defendant issued an IOU on July 6, 1997, under the pretext of a company project development loan, and affixed the seal of Shenzhen Ba XX Chemical Co., Ltd., a company he funded and served as legal representative and general manager. After the breakup, the plaintiff repeatedly demanded repayment, but the defendant delayed under various pretexts. After numerous unsuccessful attempts, the plaintiff retained Wang Tengfeng, director of Guangdong Zhiming Law Firm, to pursue legal recourse. After review, Wang Tengfeng strategically leveraged the IOU, directly naming Gu XX personally and his company as defendants, and filed a lawsuit with the Futian District People's Court on July 2, 1999, solely on the grounds of personal business debt, seeking an order for defendants Gu XX and Shenzhen Ba XX Chemical Co., Ltd. to repay the RMB 200,000 loan plus statutory interest.

II. Judgment

On November 16, 1999, the first-instance judgment of the Shenzhen Futian District People's Court [Case No. (1999) Shen Fu Fa Min Chu Zi No. 857] stated:

"This court finds that defendant Gu XX borrowed money from the plaintiff and affixed the seal of defendant Ba XX Chemical Co., Ltd. on the IOU, but existing evidence cannot confirm that the aforementioned loan is related to defendant Ba XX Chemical Co., Ltd. Therefore, the debtor in this case is defendant Gu XX, who shall bear the responsibility for repaying the debt, while defendant Ba XX Chemical Co., Ltd. bears no liability. Since the parties did not agree on a repayment period or debt interest at the time of the loan, the plaintiff is legally entitled to assert their rights against the defendant at any time, but the plaintiff is not entitled to demand interest on the loan during the borrowing period. However, as defendant Gu XX still failed to repay after the plaintiff filed the lawsuit, he shall pay interest on the loan from the date of the lawsuit in accordance with the law. Pursuant to Article 130 of the Civil Procedure Law of the People's Republic of China and Article 88, Paragraph 2, Subparagraph 2, and Article 90 of the General Principles of the Civil Law of the People's Republic of China, the judgment is as follows:"

I. Defendant Gu XX shall repay the loan of RMB 200,000 to plaintiff Xin XX within ten days from the effective date of this judgment, and pay interest (calculated at the bank's loan interest rate for the same period, from July 5, 1999, to the date determined for repayment); if overdue, the debt interest during the delayed performance period shall be doubled.

II. The plaintiff's claim against Shenzhen Ba XX Chemical Co., Ltd. is dismissed.

III. The plaintiff's other claims are dismissed.

III. Case Analysis

Regarding the case, the plaintiff's representative argues:

(I) The loan relationship between the plaintiff and defendant is clear, and the defendant is obligated to repay.

The plaintiff and the defendant met each other in 1995, and their relationship gradually became close. Starting from August 1995, they jointly lent a total of 200,000 yuan to Gu XX. The IOU proves that the creditor-debtor relationship between the two parties has been established, and the plaintiff has the legal right to demand that the defendant Gu XX repay the loan. Later, their relationship gradually became distant. The plaintiff repeatedly demanded that Gu XX repay the money, but the defendant Gu XX made excuses to delay.

(2) The defendant Gu XX's evasion of debt is egregious, and the court is requested to enforce repayment.

The defendant Gu XX, despite having sufficient ability to repay, refused to repay the money and made excuses to delay. What is even more egregious is that since the plaintiff filed the lawsuit with the court, the defendant Gu XX has engaged in a series of malicious evasion and dishonest behaviors: disconnecting the home phone, mobile phone, and pager, relocating the factory, moving houses, and avoiding responding to the lawsuit, seriously hindering the normal progress of the court's trial. To protect the plaintiff's legal rights, during the litigation period, property preservation was applied for regarding a high-end commercial apartment purchased by the defendant Gu XX at Jingfu Building on Binhe Road. After the judgment took legal effect, an application was made to the court for a lawful auction and enforcement.

In summary, based on the facts and the law, as well as the defendant Gu XX's malicious evasion of debt and avoidance of responding to the lawsuit, the court made a judgment in accordance with the law. The plaintiff's agent promptly applied to the court for legal enforcement measures, effectively safeguarding the plaintiff's legal rights and interests.

(Compiled and commented by Zhang Qingping)

Guangdong Zhiming Law Firm

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