[1] How to deal with a decoration company playing tricks with "real people but fake seals"?
Compiled from: Shifeng District Court, Zhuzhou City
Case review
Ms. Li wanted to renovate her house and found a decoration company with very favorable prices online. She then contacted a man named Yan based on online advertisements and signed a "Decoration Construction Contract" with him, prepaying 39,200 yuan for the renovation. After the contract was signed, Yan and Xiao, the legal representative of a decoration design company in Zhuzhou, coordinated with Ms. Li on the decoration design and construction matters. However, the construction progress was extremely slow, and Ms. Li's repeated urgings yielded no results.
After several negotiations, Yan agreed to refund the advance payment to Ms. Li and arranged to meet her at the office of Zhuzhou Mouyi Decoration Design Co., Ltd. to sign a refund agreement, which bore the seal of "Zhuzhou Mouyi Decoration Company Contract Special Seal." The legal representative of Zhuzhou Mouyi Decoration Design Co., Ltd., Xiao, was present when the agreement was signed.
Later, Yan and Zhuzhou Mouyi Decoration Design Co., Ltd. failed to fulfill the refund agreement, so Ms. Li sued both the company and Yan in the Shifeng District Court of Zhuzhou. During the pre-litigation mediation, Xiao paid Ms. Li 10,000 yuan but refused to pay the remaining 29,200 yuan.
During the trial, the lawyer for Zhuzhou Mouyi Decoration Design Co., Ltd. argued that the company seal on the refund agreement was a "fake seal" privately carved by Yan and that it lacked the words "Design Co., Ltd." compared to the company's full name. The lawyer disputed the validity of the seal and claimed the company should not bear the refund responsibility.
[1] Court Opinion
Although the involved "Decoration Construction Contract" was not signed between Zhuzhou Mouyi Decoration Design Co., Ltd. and Ms. Li, and the seal on the "Refund Agreement" did not fully match the company's full name, considering that Xiao, the legal representative of Zhuzhou Mouyi Decoration Design Co., Ltd., had communicated with Ms. Li about decoration matters, the refund agreement was signed at the company's office, and Xiao was present during the signing, it could be determined that Xiao, as the legal representative, had expressed the company's intention to bear the refund responsibility.
In conclusion, the court ruled that Zhuzhou Mouyi Decoration Design Co., Ltd. should refund the decoration fee of 29,200 yuan to Ms. Li.
Civil Code of the People's Republic of China
Article 61
According to the law or the provisions of the legal person's charter, the person responsible for representing the legal person in civil activities is the legal representative of the legal person.
The legal consequences of civil activities conducted by the legal representative in the name of the legal person shall be borne by the legal person.
Restrictions on the representative authority of the legal representative imposed by the legal person's charter or its governing body shall not be invoked against a bona fide third party.
[1] The author's perspective
This case is a typical instance of a "real person with a fake seal." The validity of such contracts should be determined by considering factors such as whether the person had the authority to represent or act as an agent when affixing the seal, whether the conduct of the represented party before and after the contract signing, in relation to the contract terms, was sufficient to make the counterparty reasonably believe that the contract party was the represented party. For example, in this case, the legal representative of the decoration company actually participated in the preliminary project coordination and was also present when the refund contract was signed, indicating that the company was not unaware of the situation.
As for the issue that the affixed seal was not the genuine official seal, the fake seal still bore the main part of "Zhuzhou Mouyi Decoration Company," with only the missing "Design Co., Ltd." being not easily noticeable. Moreover, ordinary citizens are not legal experts and cannot scrutinize contracts word for word like lawyers. Therefore, the court also considered these factors, and the author believes the judgment is lawful and fair. However, this case also serves as a reminder to everyone: regardless of the type of contract, it must be carefully reviewed before signing. If one signs carelessly, they may end up at a disadvantage later.
