11月3日，“[2] Luo Yonghao has been restricted from high consumption[3] The topic of "”" trended on the hot search. Subsequently, Luo Yonghao publicly responded on Weibo with a lengthy post, stating: "Even if the company is completely shut down due to force majeure, I will personally pay off all debts through means like 'busking'." On the 4th, a reporter from Yangtze Evening News/Ziniu News contacted[4] Chen Guoying, Director of the Enforcement Bureau of Danyang City People's Court. Director Chen clearly stated: Welcome! At the same time, he emphasized a warning: As a public figure, one should set a better example of "integrity" for the general public.(Partially sourced fromYangtze Evening Post）

The full story of the incident:

Jiangsu Chenyang Electronics Co., Ltd. and Luo Yonghao's Smartisan Technology Company began business dealings in May 2017, with Chenyang supplying chargers to Smartisan. During the cooperation, Chenyang actually delivered goods worth 3,755,991.6 yuan to Smartisan, but Smartisan only paid 50,000 yuan. As of November 1, 2018, Smartisan still owed Chenyang 3,705,991.6 yuan in货款. After multiple unsuccessful attempts to demand payment, Chenyang filed a lawsuit with the people's court.

After Chenyang filed the lawsuit, the two parties signed a "Debt Disposal Agreement." The agreement recorded that the debt arising from the cooperation between the creditor (Chenyang) and the debtor (Smartisan) under the original cooperation agreement totaled 3,705,991.6 yuan.

The debt disposal plan recorded: The debtor shall pay the creditor 1,111,797.48 yuan before January 31, 2019. If the debtor fails to make payment on time according to the above payment schedule, this agreement arrangement will become invalid, and all parties will still fulfill their obligations according to the original debt situation. The debtor agrees to extend the payment period for the remaining debt of 2,594,194.12 yuan by 3 years, from February 1, 2019, to January 31, 2022.

However, Smartisan failed to fulfill the first installment payment obligation under the "Debt Disposal Agreement."

On August 6, 2019, the court ruled:

In accordance with Article 109 of the Contract Law of the People's Republic of China and Article 144 of the Civil Procedure Law of the People's Republic of China, the judgment is as follows:

The defendant, Beijing Smartisan Digital Technology Co., Ltd., shall pay the plaintiff, Jiangsu Chenyang Electronics Co., Ltd., the amount of 3,705,991.6 yuan in goods payment within 10 days from the effective date of this judgment.

If the obligation to pay money is not fulfilled within the period specified in this judgment, interest on the debt during the period of delayed performance shall be doubled in accordance with Article 253 of the Civil Procedure Law of the People's Republic of China.

In the end, as everyone saw, Smartisan Technology still did not pay.

 

于是，

 

The court ruled on September 4.Case filing and enforcementIn the case of the dispute over a sales contract filed by Chenyang Company against Smartisan Technology,Thus came the consumption restriction order against Luo Yonghao.

Why is it that the consumption restriction measures were imposed on Smartisan Technology, yet Luo Yonghao is implicated?

Legal interpretation:


Why was Luo Yonghao subjected to the enforcement of a consumption restriction order?

According to Article 3 of the "Provisions of the Supreme People's Court on Restricting High Consumption and Related Consumption of Persons Subject to Enforcement":

If the person subject to enforcement is a natural person, after the adoption of consumption restriction measures, they shall not engage in the following high consumption and consumption behaviors not necessary for daily life or work:

(1) When taking transportation, choosing aircraft, soft sleepers on trains, or first-class and above cabins on ships;

(2) Engaging in high consumption at star-rated hotels, restaurants, nightclubs, golf courses, and similar venues;

(3) Purchasing real estate or constructing, expanding, or high-end renovating houses;

(4) Leasing high-end office buildings, hotels, apartments, and similar premises for business operations;

(5) Purchasing vehicles not necessary for business operations;

(6) Traveling or vacationing;

(7) Children attending high-tuition private schools;

(8) Purchasing insurance financial products with high premiums;

(9) Taking all seats on G-series high-speed trains, first-class or above seats on other high-speed trains, and other non-essential consumption behaviors for daily life and work.

If the person subject to enforcement is an entity, after consumption restrictions are imposed, the entity and its legal representative,principal responsible person, directly responsible personnel affecting debt performance, and actual controllerThe acts specified in the preceding paragraph shall not be carried out. For private consumption using personal property to carry out the acts specified in the preceding paragraph, an application may be submitted to the enforcing court.If the enforcing court verifies the application as true, it shall grant approval.

 

Luo Yonghao, as the legal representative of Smartisan Technology, naturally became subject to consumption restrictions.

 

However, on December 5, 2018, Smartisan Technology changed its legal representative from Luo Yonghao to Wen Hongxi, thereby effectively circumventing the restrictions.之后Some consumption restrictions that should have been directed at him.

This is what Luo Yonghao mentioned in his confession—actions like changing the legal representative, which were necessary for continuing operations to repay debts.


How can Luo Yonghao lift the consumption restriction order?

A lawyer from Guangdong Zhiming Law Firm statedGenerally, the people's court may lift the high-consumption restriction order on the person subject to enforcement under the following two circumstances:

 

1. During the period of high-consumption restriction, the person subject to enforcement provides a valid and effective guarantee or obtains the consent of the applicant for enforcement;

2. The person subject to enforcement has fully performed the obligations specified in the effective legal document.

Legal basis:



Article 8 of the Supreme People's Court's Several Provisions on Restricting High Consumption by Persons Subject to Enforcement: A person subject to enforcement who is restricted from high consumption and needs to engage in consumption activities prohibited by these provisions due to necessities of life or business shall file an application with the people's court and may proceed only after obtaining approval.

 

Article 9: During the period of high consumption restriction, if the person subject to enforcement provides valid and effective guarantee or obtains the consent of the applicant for enforcement, the people's court may lift the high consumption restriction order; if the person subject to enforcement has fully performed the obligations determined by the effective legal document, the people's court shall promptly lift the high consumption restriction order by notification or announcement within the scope specified in Article 6 of these provisions.

(Part of the article sourced from China Judgments Online and Yangtze Evening News)