【Main Points of the Judgment】In cases where the conduct of one of the parties or other reasons may make it difficult to enforce the judgment or cause other harm to the parties, the people's court may, on the basis of the application of the other party, rule to preserve its property. However, if the application is erroneous, the applicant shall compensate the respondent for the losses suffered as a result of the preservation. Article 105 of the Civil Procedure Law stipulates that the liability for compensation for compensation for interim error in the application for preservation is general tort liability. According to paragraph 1 of article 6 of the original Tort Liability Law, which stipulates that "the actor shall bear tort liability for infringing on the civil rights and interests of others due to fault", the applicant must be at fault in the constituent elements of the liability for damages. Regarding the determination of the applicant's fault, a comprehensive judgment should be made from the aspects of the subjective fault of the parties and the objective illegality of the conduct, combined with the facts of the case. From the perspective of subjective factors, the applicant should generally perform a reasonable and prudent duty of care, meet the general reasonable person standard, and have no intention or gross negligence. From an objective point of view, the applicant's application for property preservation should have a basic factual basis and legal basis, and there should be corresponding evidence to support his litigation claim, and there can be no obvious wrongdoing.
Supreme People's Court of the People's Republic
Civil judgments
(2018) SPC Min Zhong No. 81
Appellant (plaintiff in the first instance): Guangdong Gudi Plastic Co., Ltd., domiciled in Huan'an Road, Weihong Neighborhood Committee, Ronggui Street Office, Shunde District, Foshan City, Guangdong Province.
Legal representative: Qiu Lijuan, chairman of the board of directors of the company.
Entrusted litigation agent: Su Yi, lawyer of Shanghai Fangda (Guangzhou) Law Firm.
Entrusted litigation agent: Xiao Xiao, lawyer of Shanghai Fangda (Guangzhou) Law Firm.
Appellee (defendant in the first instance): Xiamen International Bank Co., Ltd. Zhuhai Branch, domicile in ** AVIC Building**, Jiuzhou Avenue, Jida, Zhuhai City, Guangdong Province.
Person in charge: Zhang Zhirong, General Manager of the branch.
Entrusted litigation agent: Long Bin, lawyer of Guangdong Jingcheng Yueheng Law Firm.
Entrusted litigation agent: Qu Yan, lawyer of Guangdong Jingcheng Yueheng Law Firm.
Appellee (defendant in the first instance): Xiamen International Bank Co., Ltd., domiciled in Lujiang Road, Siming District, Xiamen City, Fujian Province.
Legal representative: Weng Ruotong, chairman of the board of directors of the company.
The appellant, Guangdong Gudi Plastic Co., Ltd. (hereinafter referred to as Gudi Company), appealed to this Court against the Guangdong Provincial Higher People's Court (hereinafter referred to as the Court of First Instance) (2016) Yue Min Chu No. 18 Civil Judgment of the Higher People's Court of Guangdong Province (hereinafter referred to as the Court of First Instance) (2016) Yue Min Chu No. 18 in a dispute over liability for property preservation damages in a dispute between the appellee, Xiamen International Bank Co., Ltd. Zhuhai Branch (hereinafter referred to as Xiamen International Bank Zhuhai Branch) and Xiamen International Bank Co., Ltd. (hereinafter referred to as Xiamen International Bank). After filing the case on January 15, 2018, this court formed a collegial panel in accordance with law and held a hearing. Gudi Company's entrusted litigation agents Su Yi and Xiao Xiao, and Xiamen International Bank Zhuhai Branch and Xiamen International Bank's entrusted litigation agents Long Bin and Qu Yan attended the court to participate in the litigation. The case is now closed.
Gudi Company's appeal request: 1. Rescind the Court of First Instance (2016) Yue Min Chu No. 18 Civil Judgment; 2. Order Xiamen International Bank Zhuhai Branch to compensate Gudi Company for economic losses totaling 47829670 yuan (calculated based on 10% of all investment compensation and expense losses); 3. Order Xiamen International Bank to bear joint and several liability for the above-mentioned liability of Xiamen International Bank Zhuhai Branch; 4. Order Xiamen International Bank Zhuhai Branch and Xiamen International Bank to report to China Securities News, Securities Times, Foshan Daily, "Foshan Daily", "China Securities News", "Foshan Daily", " Pearl River Business Daily, Sina.com, Sohu.com, NetEase.com and other public media published newspapers to eliminate adverse effects; 5. The litigation costs of the first and second instance trials of this case shall be borne by Xiamen International Bank Zhuhai Branch and Xiamen International Bank. Main facts and reasons: This case is an atypical property preservation error damage compensation case caused by the malicious abuse of property preservation rights by Xiamen International Bank Zhuhai Branch to obstruct normal transactions, resulting in major economic losses suffered by Gudi Company. There were major errors in the first-instance court's determination of facts and the application of law.
(1) The illegality and subjective malice of the property preservation act of Xiamen International Bank Zhuhai Branch are extremely concealed and confusing, and to identify and determine the illegality of the preservation act, it is necessary to accurately understand the original intention and value orientation of the establishment of the property preservation system. According to Article 100 of the Civil Procedure Law of the People's Republic of China (hereinafter referred to as the Civil Procedure Law), the sole purpose of the property preservation system is to ensure the enforcement of judgments. Any application or measure for preservation that does not use the above provisions as the purpose of preservation shall be deemed to be illegal. After Gudi Company submitted a reconsideration of the preservation measures, the Zhuhai Branch of Xiamen International Bank abandoned the seizure of the mortgaged real estate, and instead seized almost all the shares that had been pledged and were in the critical period of transfer and delivery, which was obviously to exert pressure on Gudi Company, so that Gudi Company was forced to comply with the dilemma of serious default, and the Zhuhai Branch of Xiamen International Bank abused the property preservation system, and there was obvious subjective malice. The court of first instance ignored the provisions and restrictions of the purposeful nature of the property preservation system, blindly emphasized that it was the plaintiff's legal right to apply for property preservation, and finally made an erroneous and unfair judgment.
(2) The excess seizure of the Zhuhai Branch of Xiamen International Bank was illegal. In this case, the litigation claim of Xiamen International Bank Zhuhai Branch was only 37 million yuan, although it was clearly limited to 37 million yuan when it applied for preservation, but it knew that the value of the mortgaged property seized was as high as more than 80 million yuan, and the market value of the frozen stock was as high as 1.2 billion yuan, but it still seized both the mortgaged property and the stock, and if this practice of using the seizure limit as a "shield" was recognized, the provisions on not exceeding the seizure would be useless. The Zhuhai Branch of Xiamen International Bank cannot be bound by the principle of reciprocity in the value of seized property on the grounds that the limit of 37 million yuan is not bound, so as to achieve the illegal purpose of "taking the small and the big" in litigation preservation.
(3) The Zhuhai Branch of Xiamen International Bank, as the mortgagee, explicitly required Gudi Company to submit an appraisal report on the mortgaged property at the time of lending, and was fully aware that the value of the mortgaged property was as high as more than 80 million yuan, which was more than twice the amount of its creditor's rights. However, when applying for property preservation, Xiamen International Bank Zhuhai Branch deliberately concealed and neglected to provide the mortgage property appraisal report, resulting in the Intermediate People's Court of Zhuhai City, Guangdong Province (hereinafter referred to as the Zhuhai Intermediate Court) neglecting to review, and the behavior of Xiamen International Bank Zhuhai Branch constituted deliberate subjective fault. The first-instance judgment did not make a determination on this issue, which was biased.
(4) The first-instance judgment found that "when Gudi Company submitted an application for property preservation reconsideration, the Zhuhai Branch of Xiamen International Bank applied to the Zhuhai Intermediate Court to revoke the property preservation of the mortgaged property, which was a disposition of its own rights by the Zhuhai Branch of Xiamen International Bank." Based on this, the Zhuhai branch of Xiamen International Bank revoked the seizure of the mortgaged property on its own after The Gudi Company applied for reconsideration, and the court of first instance could fully identify and determine the fact that there was an excess seizure in this case, but the court of first instance made the illegal act that was originally in a state of excess seizure "legalized" by unsealing the mortgaged property that was obviously overvalued. The first-instance judgment had a major erroneous determination of the key facts of the case and the application of law.
(5) The balance of bank deposits that have been seized in this case is only more than 200,000 yuan, which is not enough to repay the debts of Xiamen International Bank Zhuhai Branch. Given the ease with which bank deposits are executed, there is nothing wrong with retaining the seizure of bank accounts. However, 99.95% of the seized shares involved in the case have been pledged to register, and even if they are realized through judicial auction, the proceeds of the auction must first repay the principal and interest of the debt secured by the pledge. As an ordinary creditor, Xiamen International Bank Zhuhai Branch must be fully repaid after all the claims of the pledgee can be qualified to pay off the claims. In the face of stocks with a pledge rate of up to 99.95% and a secured debt of up to 910 million yuan, the freezing of the shares retained by xiamen International Bank Zhuhai Branch abandoning the mortgaged real estate is not out of consideration for the convenience and market risk of the real estate and stocks at the stage of implementation and transformation, but out of the hope of forcing Gudi Company to comply by freezing the shares due to the delivery period.
(6) The shares involved in the case are the subject of the transaction of equity transfer between Gudi Company and a third party, and as early as early 2016, an equity transfer announcement was issued on the Shenzhen Stock Exchange through the listed company Gudi Technology Co., Ltd. (hereinafter referred to as Gudi Technology Company), which includes the period of equity delivery. In view of the publicity of the listed company's announcement, Xiamen International Bank Zhuhai Branch should have been aware that the shares involved in the case were in the transfer and delivery period. In the case that Gudi Company has submitted a preservation reconsideration, it still insists on freezing the shares involved in the case, which obviously has the improper intention of putting pressure on Gudi Company by freezing shares. According to Article 6 of the Provisions of the Supreme People's Court on Several Issues Concerning the Handling of Property Preservation Cases by the People's Courts (Draft for Solicitation of Comments) issued by the Supreme People's Court in June 2016, where the shares or bonds of a listed company are preserved, the applicant for preservation shall provide a property guarantee equivalent to the transaction price of the stock or bond market. Where the stocks or bonds of a listed company that have been preserved need to be traded and disposed of in a timely manner, the people's court shall allow the conservator to trade and dispose of them, and preserve the amount of their conversion price. However, equity or bonds are excluded as the subject of dispute. According to the provisions of the Draft for Comments, the shares of the listed company that have been preserved are in the trading period and shall be allowed to go through formalities such as delivery, but only to preserve the change price. This also reflects the attitude of the Supreme People's Court to the special treatment and handling of listed company stocks, especially stocks that are in the transfer and delivery period. Although the above provisions were deleted after the judicial interpretation was promulgated, it cannot be denied that the Supreme People's Court has realized the importance of the liquidity and trading nature of listed companies' stocks. The behavior of Xiamen International Bank Zhuhai Branch is the object and behavior of the proposed regulation in the above-mentioned draft for comments, which also shows that its deliberate freezing of the shares involved in the case has obvious subjective intentions.
(7) The first-instance judgment found: "From the litigation reasons set forth in the above-mentioned complaint, it can be seen that before the Zhuhai Intermediate People's Court conducted judicial freezing and judicial freezing of the shares of Gudi Technology Company held by Gudi Company on August 27, 2015 and August 28, 2015, the facts of breach of contract claimed by the relevant parties had already occurred, so the application for preservation by Xiamen International Bank Zhuhai Branch was not directly and necessarily related to the occurrence of the above-mentioned equity dispute." Accordingly, the court of first instance only relied on three civil complaints against Hangzhou Delixi Group Co., Ltd. (hereinafter referred to as Delixi Company), Xing Jianya and Chongqing Yongrui Equity Investment Co., Ltd. (hereinafter referred to as Yongrui Company) to make a substantive judgment on the equity transfer dispute between Gudi Company and the three parties, and directly found that Gudi Company had insufficient basis for breach of contract. The freezing of the shares involved in the case by the Zhuhai Branch of Xiamen International Bank was at least one of the reasons why the equity transfer transaction involved in the case was forced to be terminated and Gudi Company paid a huge amount of liquidated damages and losses of expenses, so it should bear a certain proportion of the compensation liability.
(8) The Civil Procedure Law 104 stipulates that in a property dispute case, where the respondent provides security, the people's court shall rule to lift the preservation. It can be seen from this that the provision of security is not the obligation and responsibility of the property preservation respondent, but should be its right. Due to the deteriorating economic environment and the difficulty of capital turnover of the enterprise, Gudi Company failed to repay the loan in a timely manner, and it was indeed unable to provide a guarantee for replacement at the time of seizure. Gudi Company has submitted an application for reconsideration in accordance with the law for the stock freezing, and it is precisely the move to seek relief in accordance with the law, which is enough to confirm that Gudi Company did not allow the shares involved in the case to be judicially frozen. Due to the failure of gudi company to provide guarantees for replacement, the unfavorable consequences of gudi company are attributed to gudi company, which lacks legal basis.
(9) According to Article 107 of the Interpretation of the Supreme People's Court on Application<中华人民共和国民事诉讼法>, "In litigation, facts recognized by the parties to reach a mediation agreement or a settlement agreement to compromise shall not be used as a basis for their disadvantage in subsequent litigation." "The first-instance judgment used the content of the civil mediation document as the basis for the determination of the case, which violated the above-mentioned legal provisions and was an error in the application of the law. Moreover, in the mediation statement, Gudi Company did not recognize the legitimacy of the preservation act of Xiamen International Bank Zhuhai Branch, nor did it promise to waive the right to pursue legal liability for the wrong preservation act. The first-instance judgment found that Gudi Company lacked good faith and error.
(10) Before the loan involved in the case was due, Gudi Company applied for an extension and formulated a practical and effective repayment plan. After Xiamen International Bank Zhuhai Branch accepted Gudi Company's repayment plan, Gudi Company actively fulfilled its repayment obligations in accordance with the repayment plan, and Xiamen International Bank Zhuhai Branch did not raise any objections to repayment matters. Under these circumstances, Xiamen International Bank Zhuhai Branch did not make any prior notice and reminders, that is, it lacked good faith in filing a lawsuit with the court and carrying out property preservation. There was clearly a double standard in the court of first instance in its approach to the issue of good faith.
In summary, the preservation act of Xiamen International Bank Zhuhai Branch clearly violated the purpose of the establishment of the property preservation system of the Civil Procedure Law, which was an abuse of its litigation rights and constituted an illegal and infringing act. Taking into account the weight of the investment compensation and expense losses caused by the behavior of Xiamen International Bank Zhuhai Branch, Gudi Company argued that Xiamen International Bank Zhuhai Branch should bear at least 10% of the total loss of investment compensation and expenses 478296700 yuan, that is, 47829670 yuan.
Xiamen International Bank Zhuhai Branch argued that the first-instance judgment was clear in the facts and the application of the law was correct and should be upheld.
(1) Regarding the value and purpose of the property preservation system. Gudi Company's understanding and interpretation of the preservation system in the Civil Procedure Law clearly distorted the original meaning of the legislation. According to Article 102 of the Civil Procedure Law, "preservation is limited to the scope of the request, or property related to the case". The Code of Civil Procedure has never provided that a measure of preservation may only be directed against a certain property of a party or only to secured property. As a creditor, Xiamen International Bank Zhuhai Branch may apply for preservation of the part of All Assets of Gudi Company equivalent to the litigation claim in accordance with the law, so as to ensure the smooth execution of the effective judgment in the future, and there is no fault.
(2) Seizures that exceed the standard. According to the civil ruling finally determined by the Zhuhai Intermediate People's Court, the preservation property was not seized, and the "real estate worth more than 80 million yuan" was not seized, and Gudi Company determined that there was no basis for the seizure in excess of the standard. The so-called market value of the frozen shares is as high as 1.2 billion, and since 99.95% of the property has been pledged to the outside world, the remaining value cannot be determined. What is seized is the surplus value of the stock, and there is no problem of seizure beyond the standard. The Zhuhai Intermediate People's Court's civil ruling "limited to 37 million yuan" meets the requirements of the law, not the so-called "small and broad" of Gudi Company, which not only does not make the provision that "no excess seizure" invalid, but also protects the legitimate rights and interests of creditors to a greater extent, ensuring the smooth implementation of the effective judgment in the future, which is in line with the original intention and purpose of the property preservation system. Whether there is an attachment that exceeds the standard shall be determined by the seized property determined by the people's court's final civil ruling. Gudi Company has already exercised the remedy of reconsideration, the Zhuhai Intermediate Court has also lifted the seizure of some of its property, and Gudi Company has calculated the total amount of property that has been unsealed, thus drawing a conclusion that exceeds the standard, which is obviously untenable.
(3) Criteria for judging errors in preservation. Litigation preservation damage compensation disputes are general tort liability disputes, and the illegality of the conduct is one of the constituent elements of tort liability. It is meaningless and without legal basis to one-sidedly emphasize and analyze subjective malice and motives until the illegality of the act has been determined. The law does not stipulate that property that is being traded or is preparing to be traded cannot be included in the scope of property preserved by litigation preservation, and in practice, property that is being traded or is preparing to be traded is seized or frozen by litigation preservation. The creditor-debtor relationship between Xiamen International Bank Zhuhai Branch and Gudi Company is legal and valid, and Gudi Company did not fully perform its repayment obligations in accordance with the agreement after the expiration of the loan contract, and defaulted first. The Zhuhai Branch of Xiamen International Bank filed a lawsuit with the People's Court for the lawful act of exercising the creditor's rights.
(4) On the causal relationship between the preservation act and the losses of Gudi Company. According to the lawyer letters sent by Beijing Jincheng Tongda (Shanghai) Law Firm submitted by Gudi Company in the first instance on August 27, 2015 and September 21, 2015, it can be seen that Gudi Company already had situations that made it impossible to smoothly deliver shares before the seizure, such as re-pledge of shares for the shares to be delivered in June 2015, and suspension of trading in internal disputes among shareholders. It can be seen that even without the seizure of the Zhuhai branch of Xiamen International Bank, Gudi Company could not complete the share delivery procedures. The relevant transferee of the shares involved in the case also made it clear in the civil complaint that Gudi Company began to have breach of contract before the expiration of the stock restriction period and neglected to perform the relevant obligations of the equity transfer transaction, without mentioning that the transaction could not be carried out because of the preservation of the shares by the Zhuhai Branch of Xiamen International Bank. Gudi Company also made it clear in its external announcement on August 20, 2015 that due to the above reasons, there is a risk of termination of the transaction in which Gudi Company transferred shares to Delixi Company. After Delixi Company, Yongrui Company and Xing Jianya sued, Gudi Company reached a mediation agreement with them, and before reaching a mediation agreement, Shanxi Shengnong Investment Co., Ltd. (hereinafter referred to as Shengnong Company) paid part of the compensation to the court account. It can be inferred that in order to seek greater commercial interests, Gudi Company had already approached and reached a consensus with Sheng Nong Company as early as the performance of the contract with delixi company and other equity transferees. Objectively, it has become impossible for Gudi Company to continue to perform its contract with the transferee of the three shares.
The huge compensation paid by Gudi Company to Delixi Company, Yongrui Company and Xing Jianya was a trade-off compromise made by Gudi Company in order to seek greater commercial benefits from Shanxi Shengnong, and could not be called a loss. The transfer of equity by Gudi Company was illegal. According to the relevant provisions of the Csrc, the shares could not receive transaction money and transfer the shareholders' rights and interests before the expiration of the restriction period, but in the Supplementary Agreement on Share Transfer dated 13 March 2015, Gudi Company agreed that it had collected a performance bond exceeding 50% of the total transaction amount and transferred or restricted the shareholders' rights and interests, and Gudi Company did not disclose the supplementary agreement in accordance with the provisions of the Shenzhen Stock Exchange and deliberately concealed it. The illegality of the transaction also naturally affected the legitimacy of the voluntary compensation of the company in the later period. It can be seen that the property preservation act did not cause losses to Gudi Company.
(5) About loan extension. Gudi Company appealed that it and Xiamen International Bank Zhuhai Branch had reached an agreement on deferring repayment, Gudi Company actively performed the repayment agreement, and Xiamen International Bank Zhuhai Branch reversed the lawsuit and carried out preservation, violating good faith and goodwill. In this regard, the claims involved in the case matured on March 27, 2015, and Xiamen International Bank Zhuhai Branch based on the information disclosure of Gudi Company, that is, Gudi Company could have receivables of RMB800 million after the lifting of the stock ban on August 16, 2015 in accordance with the Share Transfer Agreement, thereby confirming its solvency, and only then accommodating the repayment period of the claims until August 21, 2015. However, at the same time as the Signing of the Supplementary Agreement on Share Transfer in March 2015, Gudi Company had already privately collected a performance bond of more than 50% of the total amount of the transaction, totaling RMB420 million, but concealed and did not disclose the fact that the transaction money had been collected in accordance with the requirements of the CSRC, and deliberately failed to return the overdue loan, causing significant losses to the Zhuhai Branch of Xiamen International Bank. The two parties also did not agree on the deferral of repayment, and the so-called deferred repayment is only the repayment period unilaterally promised by Gudi Company. Xiamen International Bank Zhuhai Branch enjoys legal claims against Gudi Company, which can claim rights at any time, and whether to extend it depends entirely on Xiamen International Bank Zhuhai Branch itself.
(6) Apologize for the courtesy. For non-property litigation claims such as apologies and apologies submitted by Gudi Company, because the claim is based on the infringement of personality rights, this case is a property preservation damage compensation dispute, which is a general tort dispute and does not involve Gudi Company's personality rights. There is no legal basis for this claim, and the first-instance judgment rejecting the request is not improper.
In summary, there is nothing wrong with Xiamen International Bank Zhuhai Branch initiating a lawsuit based on a legally valid claim and taking litigation preservation measures in accordance with the provisions of the law. The preservation measures taken did not cause losses to the Gudi Company, and there was no causal relationship between the so-called losses and the preservation acts. The conduct of Xiamen International Bank Zhuhai Branch does not constitute an abuse of litigation rights, does not violate the original intention and purpose of the preservation system, and does not constitute illegality and infringement. Request that Gudi Company's appeal request be dismissed in accordance with the law.
Xiamen International Bank argued that the first-instance judgment found that the facts were clear, the law was correct, and the results were fair and reasonable, and requested that it be upheld. The specific reasons are the same as the defense opinions of Xiamen International Bank Zhuhai Branch.
Gudi Company sued the court of first instance for: 1. Xiamen International Bank Zhuhai Branch compensated Gudi Company for a total of 521769686.57 yuan in economic losses, including: investment compensation and expense losses of 478296700 yuan, penalty interest, liquidated damages and compound interest losses of 43472986.57 yuan. 2. Xiamen International Bank Zhuhai Branch and Xiamen International Bank jointly compensate for the economic losses requested in Item 1; 3. Xiamen International Bank Zhuhai Branch and Xiamen International Bank apologized to Gudi Company in public media such as China Securities News, Securities Times, Foshan Daily, Pearl River Business Daily, Sina.com, Sohu.com, netease.com, etc., to eliminate the adverse effects; 4. The litigation costs in this case were borne by Xiamen International Bank Zhuhai Branch and Xiamen International Bank.
The court of first instance found the facts: On March 28, 2014, Gudi Company and Xiamen International Bank Zhuhai Branch signed the Comprehensive Credit Line Contract (No. GRZ13129), stipulating that a credit loan of RMB55 million would be granted, and the effective period of the line would be from March 28, 2014 to March 27, 2015. The annual interest rate of the loan is 7.2%, and the Zhuhai Branch of Xiamen International Bank collects interest on the loan on a quarterly basis, and the settlement date is the eleventh day of the last month of each quarter (in case of holidays, it is advanced to the previous bank working day), and Gudi Company should pay the interest due on the settlement date. Guangdong Weixiong Group Co., Ltd. (hereinafter referred to as Weixiong Group) provided mortgage guarantee for the debts owed by Gudi Company with its real estate located at No. 13 Huan'an Road, Weihong Neighborhood Committee, Ronggui Town, Shunde City, and the corresponding land use rights of the property, which had a construction area of 27,792.90 square meters, was used for industrial purposes, and had an appraised current value of 80.2603 million yuan. Weixiong Group, Guangdong Zhengye Electric Appliance Co., Ltd. (hereinafter referred to as Zhengye Company), CHAOQUNGRACELIN (Lin Chaoqun), CHAOMINGLIN (Lin Chaoming), KEVINHUALIN (Lin Changhua), AARONCHANGSHENGLIN (Lin Changsheng) provide full responsibility for the repayment of the loan. The conclusion, validity, interpretation, performance and dispute resolution of the contract shall be governed by the laws of the People's Republic of China. Disputes and controversies arising out of or in connection with the contract shall be resolved through consultation between the two parties, and the people's court of the zhuhai branch of Xiamen International Bank shall have jurisdiction over the negotiation. The contract is also accompanied by the "Maximum Mortgage Contract" signed by Xiamen International Bank Zhuhai Branch and Weixiong Group, and the "Guarantee Contract" signed by Xiamen International Bank Zhuhai Branch with Weixiong Group, Zhengye Company, CHAOQUNGRACELIN (Lin Chaoqun), CHAOMINGLIN (Lin Chaoming), KEVINHUALIN (Lin Changhua) and AARONCHANGSHENGLIN (Lin Changsheng).
On August 21, 2015, Xiamen International Bank Zhuhai Branch sued Gudi Company, Weixiong Group, Zhengye Company, CHAOQUNGRACELIN, CHAOMINGLIN, KEVINHUALIN, AARONCHANGSHENGLIN, on the grounds that the principal of the loan was 35803200 yuan and the corresponding interest and penalty interest, etc. had not been repaid, requesting: Gudi Company repaid the loan 35803200 yuan and the corresponding interest, penalty interest, compound interest, The cost of realizing the claim; the judgment to dispose of the collateral provided by Weixiong Company, and the repayment of the above debts in priority with the proceeds; and the judgment of Shono Corporation, CHAOQUNGRACELIN, CHAOMINGLIN, KEVINHUALIN, AARONCHANGSHENGLIN TO BEAR JOINT AND SEVERAL WARRANTIES. The cause of the case is a dispute over a financial loan contract, and the case number is (2015) Zhuzhong Fa Min Si Chu Zi No. 35.
While initiating the lawsuit in this case, The Zhuhai Branch of Xiamen International Bank applied for the sealing, seizure and freezing of the assets of Gudi Company and Weixiong Group, and the amount of preservation was limited to 37 million yuan. Xiamen International Bank Zhuhai Branch provided the following assets that can be preserved: 1. Deposits opened by Gudi Company in the following bank accounts: 1. China Construction Bank Shunde Guizhou Branch (account number: 44×××58); 2. Ronggui Rongqi Branch of Guangdong Shunde Rural Commercial Bank (account number: 16×××76); 3. Bank of China Shunde Ronggui Branch (account number: 67×××77); 4. Foshan Branch of China CITIC Bank (account number: 74×××71) 5.Business Department of Jiujiang Bank Guangzhou Branch (Account Number: 58×××53); 6.Bank of Nanchang Guangzhou Zhujiang New Town Branch (Account Number: 02×××27); 7.Industrial and Commercial Bank of China Foshan Ronggui Branch (Account Number: 20×××84); 8.Ping An Bank Foshan Ronggui Branch (Account Number: 11×××02) 9. Business Department of Foshan Branch of Bank of Communications (account number: 446267000012014017961); 10.Jihua Branch of Foshan Branch of China Merchants Bank (account number: 75×××89); 11.Zhuhai Branch of Xiamen International Bank (account number: 80×××47). 2. The property under the name of Weixiong Group located at No. 13 Huan'an Road, Weihong Community Residents' Committee, Ronggui Street Office, Shunde District, Foshan City (real estate title certificate number: 00××45). 3. Gudi Technology Co., Ltd. held by Gudi Company 142146800 shares (stock code: 002694, securities name: Gudi Technology) and its dividends due in accordance with the "Announcement on the Implementation of the 2014 Annual Equity Distribution of Gudi Technology Co., Ltd." The Zhuhai Branch of Xiamen International Bank issued a Letter of Commitment for Litigation Preservation to the Zhuhai Intermediate Court, agreeing that the security of its own assets shall be liable for compensation for the property losses of the conservators caused by the error in preservation.
On August 26, 2015, the Zhuhai Intermediate People's Court issued the (2015) Zhuzhong Fa Min Si Chu Zi No. 35 Civil Ruling, I. Freezing the deposits of Gudi Company in the following bank accounts: 1. China Construction Bank Shunde Guizhou Branch (account number: 44×××58); 2. Ronggui Rongqi Branch of Guangdong Shunde Rural Commercial Bank (account number: 16×××76); 3. Bank of China Shunde Ronggui Branch (account number: 67×××77) 4.Foshan Branch of China CITIC Bank (Account Number: 74×××71); 5.Business Department of Jiujiang Bank Guangzhou Branch (Account Number: 58×××53); 6.Bank of Nanchang Guangzhou Zhujiang New Town Branch (Account Number: 02×××27); 7.Industrial and Commercial Bank of China Foshan Ronggui Branch (Account Number: 20×××84); 8.Ping An Bank Foshan Ronggui Branch (Account Number: 11×××02) 9. Business Department of Foshan Branch of Bank of Communications (account number: 446267000012014017961); 10.Jihua Branch of Foshan Branch of China Merchants Bank (account number: 75×××89); 11.Zhuhai Branch of Xiamen International Bank (account number: 80×××47). 2. Seizure of the property under the name of Weixiong Group located at No. 13 Huan'an Road, Weihong Community Residents' Committee, Ronggui Street Office, Shunde District, Foshan City (real estate title certificate number: 00××45). 3. Freeze the shares 142146800 shares (stock code: 002694, securities name: Gudi Technology) and their fruits (dividends due in accordance with the Announcement on the Implementation of the 2014 Annual Equity Distribution of Gudi Technology Co., Ltd.). The amount of seizure and freezing of the above-mentioned assets is limited to 37,000,000 yuan. During the period of seizure or freezing, the transfer, mortgage or other disposition of the above-mentioned property is prohibited.
The actual amount frozen in the aforementioned bank account was 264404.74 yuan. According to the "Real Estate Mortgage Valuation Report" submitted by Guangdong Nanyue Real Estate and Land Appraisal Co., Ltd. on March 25, 2014 submitted by Gudi Company ,2014 [Yue Ping Fang (Buddha) Zi No. 201403000107], the mortgage value of industrial real estate under the name of Weixiong Group at No. 13 Huan'an Road, Weihong Community Residents Committee, Ronggui Street Office, Shunde District, Foshan City, with a total construction area of 27,792.9 square meters and a land area of 7,725.9 square meters, is estimated at 80413200 yuan. According to the "Announcement of Gudi Technology Co., Ltd. on the Judicial Freezing of the Equity of controlling Shareholders" issued by the board of directors of Gudi Technology Co., Ltd. on August 13, 2015, it shows that as of the announcement date, Gudi Company held 142146800 shares of the company's shares, and accumulated pledges to freeze 142071420 shares.
On September 6, 2015, Gudi Company filed a property preservation reconsideration with the Zhuhai Intermediate People's Court on the grounds that Xiamen International Bank Zhuhai Branch had excessively exercised its rights and the amount of property actually preserved had far exceeded its litigation claims, and Weixiong Group had provided mortgage security, requesting: 1. to revoke items 1 and 3 of the (2015) Zhuzhong Fa Min Si Chu Zi No. 35 Civil Ruling; 2. to order Xiamen International Bank Zhuhai Branch to bear the economic losses caused by the application error. On September 7, 2015, Huaxing Bank Guangzhou Branch, an outsider in the case, as the pledgee of 9,600,000 shares of Gudi Technology Company held by Gudi Company, filed a property preservation reconsideration with the Zhuhai Intermediate People's Court on the grounds that the actual amount of property preserved had far exceeded the litigation claim and that Weixiong Group had provided mortgage guarantees, requesting that the freezing of 9,600,000 shares and their fruits of the 142146800 shares of Gudi Technology Company held by Gudi Company be lifted. On September 14, 2015, the Zhuhai Branch of Xiamen International Bank submitted an application for unsealing to the Zhuhai Intermediate Court, stating that in view of the fact that Gudi Company and the guangzhou branch of Guangdong Huaxing Bank Co., Ltd. (hereinafter referred to as the Guangzhou Branch of Huaxing Bank) had filed a property preservation reconsideration of the (2015) Zhuzhong Fa Min Si Chu Zi No. 35 Civil Ruling, it decided to request the lifting of the seizure of the property under the name of Weixiong Group at No. 13 Huan'an Road, Weihong Community Residents Committee, Ronggui Street Office, Shunde District, Foshan City. On 16 September 2015, the Zhuhai Intermediate People's Court rendered a (2015) Zhuzhong Fa Min Si Chu Zi No. 35-1 civil ruling, ruling that after the seizure of the aforementioned real estate was lifted, the amount of the freeze on the aforementioned bank accounts, shares and their fruits was still limited to RMB37,000,000. In response to the application for property preservation reconsideration by Gudi Company and Huaxing Bank Guangzhou Branch, the Zhuhai Intermediate People's Court also made the (2015) Zhuzhong Fa Min Si Chu Zi No. 35 bis and ter civil rulings on September 17, 2015, holding that the frozen amount of the aforementioned bank accounts, stocks and their fruits did not exceed the amount claimed by Xiamen International Bank Zhuhai Branch, and weixiong Group used the aforementioned real estate as collateral security for a series of debts formed by the credit granting business under the Comprehensive Credit Line Contract. In the case where the respondent for property preservation provided by the respondent for property preservation as stipulated in Article 104 of the Civil Procedure Law of the People's Republic of China provides a property preservation guarantee after the people's court preserves the property, the ruling rejects the property preservation reconsideration submitted by Gudi Company and the Guangzhou Branch of Huaxing Bank, an outsider in the case, to the (2015) Zhuzhong Fa Min Si Chu Zi No. 35 Civil Ruling.
During the trial of the (2015) Zhuzhong Fa Min Si Chu Zi No. 35 case, the parties to the case, Xiamen International Bank Zhuhai Branch, Gudi Company, Weixiong Group, Zhengye Company, CHAOQUNGRACELIN (Lin Chaoqun), CHAOMINGLIN (Lin Chaoming), KEVINHUALIN (Lin Changhua), AARONCHANGSHENGLIN (Lin Changsheng), and the non-case guarantor Qiu Lijuan, Guangdong Matsumoto Electric & Electric Co., Ltd. (hereinafter referred to as Matsumoto Electric Co., Ltd.) voluntarily reached a settlement agreement on December 22, 2015. On December 25, 2015, Xiamen International Bank Zhuhai Branch applied to the Zhuhai Intermediate People's Court to withdraw the lawsuit against CHAOQUNGRACELIN, CHAOMINGLIN, KEVINHUALIN and AARONCHANGSHENGLIN on the grounds that it had reached a settlement agreement. Accordingly, on December 28, 2015, the Zhuhai Intermediate People's Court rendered the (2015) Zhuhai Fa Min Si Chu Zi No. 35 Civil Mediation Letter, which reads as follows:
All parties confirmed the following facts: First, on March 28, 2014, Xiamen International Bank Zhuhai Branch and Gudi Company signed the "Comprehensive Credit Line Contract" numbered GRZ13129, with a loan amount of 55 million yuan, and Weixiong Group mortgaged the property located at No. 13 Huan'an Road, Weihong Community Neighborhood Committee, Ronggui Street Office, Shunde District, Foshan City, and the corresponding land use right of the property (real estate title certificate number: 00××45) to Xiamen International Bank Zhuhai Branch. As a mortgage guarantee for the repayment of all debts owed by Gudi Company to Xiamen International Bank Zhuhai Branch under the loan contract, Xiamen International Bank Zhuhai Branch and Weixiong Group have handled the mortgage registration of the collateral (other warrant number: Guangdong real estate other item warrant Buddha character ** ). Both Weixiong Group and Zhengye Company provide irrevocable joint and several liability guarantees for the repayment of all debts owed by Gudi Company to Xiamen International Bank Zhuhai Branch under the loan contract. The maturity date of the loan contract is March 27, 2015, and the debts owed by Gudi Company to Xiamen International Bank Zhuhai Branch under the loan contract have expired. 2. According to the application for preservation of Xiamen International Bank Zhuhai Branch, the Zhuhai Intermediate People's Court rendered the (2015) Zhuhai Fa Min Si Chu Zi No. 35 Civil Ruling ruling: (1) freezing the shares 142146800 shares of Gudi Technology Company held by Gudi Company (stock code: 002694, securities name: Gudi Technology) and their fruits (dividends due in accordance with the Announcement on the Implementation of the 2014 Annual Equity Distribution of Gudi Technology Co., Ltd.) ;(2) Freezing the deposits of Gudi Company in the following bank accounts: 1. China Construction Bank Shunde Guizhou Branch (account number: 44×××58); 2.Ronggui Rongqi Branch of Guangdong Shunde Rural Commercial Bank (account number: 16×××76); 3. Bank of China Shunde Ronggui Branch (account number: 67×××77); 4.Foshan Branch of China CITIC Bank (account number: 74×××71); 5.Business Department of Jiujiang Bank Guangzhou Branch (account number: 58×××53) 6. Bank of Nanchang Guangzhou Zhujiang New Town Branch (account number: 02×××27); 7.Industrial and Commercial Bank of China Foshan Ronggui Branch (account number: 20×××84); 8.Ping An Bank Foshan Ronggui Branch (account number: 11×××02); 9.Bank of Communications Foshan Branch Business Department (account number: 446267000012014017961); 10.Jihua Branch of Foshan Branch of China Merchants Bank (account number: 75×××89) 11. Xiamen International Bank Zhuhai Branch (Account Number: 80×××47). The amount of seizure and freezing of the above-mentioned assets is limited to 37,000,000 yuan. 3. Gudi Company still owes Xiamen International Bank Zhuhai Branch 35803191.75 yuan in principal gold for the loan and its corresponding interest, penalty interest and compound interest.
The parties to the case and the non-guarantors Qiu Lijuan and Song Company voluntarily reached the following mediation agreement after consultation: First, on December 15, 2015, Gudi Company repaid part of the loan amount owed to Xiamen International Bank Zhuhai Branch under the loan contract: 1. Principal amount of RMB20003191.75; 2. All interest, penalty interest and compound interest of RMB2960059.31 as of December 31, 2015 (excluding the day). 2. In order to ensure the smooth repayment of the repayment amount in the first paragraph of this Agreement, Xiamen International Bank Zhuhai Branch and Gudi Company agree to perform their respective obligations in accordance with the following agreements: (1) Gudi Company designates the outsider Shengnong Company (account name: Shanxi Shengnong Investment Co., Ltd., account number: 361231010300000006073, Bank: Yuci Rural Commercial Bank Yinhai Branch) has transferred all the amount of the above-mentioned article 1 of 22,963,251.06 yuan to the designated account of the Zhuhai Intermediate Court on December 15, 2015. (2) After the signing of the settlement agreement, Gudi Company and Sheng Nong Company submitted the corresponding transfer letter to the court, clarifying that the above-mentioned funds will be used to repay part of the principal and interest of the loan of Gudi Company at Xiamen International Bank Zhuhai Branch. After receiving the above-mentioned letter, the Zhuhai Intermediate People's Court transferred the above-mentioned funds to Xiamen International Bank Zhuhai Branch (account name: Xiamen International Bank Zhuhai Branch; bank account: Xiamen International Bank Zhuhai Branch; bank account number: CNY1572300038017). (3) Xiamen International Bank Zhuhai Branch shall apply for the lifting of the property preservation measures of The Zhuhai Branch of Xiamen International Bank against the shares of Gudi Technology Company and all bank accounts held by Gudi Company after the settlement agreement has entered into effect and the Zhuhai Intermediate Court has received the transfer letter provided by Gudi Company and Shengnong Company. 3. Gudi Company shall withdraw all letters issued to the outside world regarding the loan matters of Xiamen International Bank Zhuhai Branch and Gudi Company within 3 working days after Xiamen International Bank Zhuhai Branch has fulfilled its obligations under this Agreement, including but not limited to letters sent to the Zhuhai Branch of the Banking Regulatory Commission and other units, so as to eliminate the adverse effects. 4. If Gudi Company has fulfilled the obligations stipulated in Articles 1 and 2, and on the premise of settling the remaining interest, penalty interest and compound interest under the loan contract as of the date of extension under the loan contract, Xiamen International Bank Zhuhai Branch and Gudi Company agree to extend or reorganize the remaining loans under the loan contract (the specific contract signed by the two parties shall prevail). The basic conditions for the restructuring loan are: the amount is capped at 15.8 million yuan, the loan term is not more than 6 months, and the loan interest rate is 10% of the fixed interest rate (annual interest rate). Gudi Company shall repay the interest every month and repay the principal of the loan in one lump sum on the maturity date. In addition to the guarantee method, in which Weixiong Group and Zhengye Company continue to bear the guarantee liability (including mortgage, pledge and guarantee guarantee) in accordance with the loan contract, qiu Lijuan and Song Company, outsiders to the case, voluntarily agreed to provide irrevocable joint and several liability guarantees for the above loans. The restructuring loan is a continuation of the loan under the loan contract, and Gudi Company and the above-mentioned guarantor agree to continue to bear the repayment responsibility and guarantee liability for the restructuring loan. 5. If Gudi Company fails to perform the above obligations as agreed, Xiamen International Bank Zhuhai Branch has the right to apply for compulsory enforcement, to realize the mortgage right of the property under the name of Weixiong Group located at No. 13 Huan'an Road, Weihong Neighborhood Committee, Ronggui Town, Shunde City, and the corresponding land use right of the property (real estate certificate number: Yuefang Land Certificate No. ××), the right to discount or sell the above collateral and the preservation property, the right to have the right of first refusal to repay the auction price within the scope of the above-mentioned debts, and require Weixiong Group and Zhengye Company to bear joint and several guarantee liabilities. Outsiders Qiu Lijuan and Song Company agreed to provide joint and several liability guarantees for Gudi Company to perform the above obligations. 6. The litigation costs and preservation fees in this case shall be borne by Gudi Company.
On 14 September 2015, Xiamen International Bank Zhuhai Branch submitted an application for unsealing to the Zhuhai Intermediate Court, which issued the (2015) Zhuhai Fa Min Si Chu Zi No. 35-4 Civil Ruling on 5 January 2016, ruling to lift the freezing of the deposits, stocks and fruits of the aforementioned accounts.
It was also found that in the (2015) Yue Gao Fa Min Si Chu Zi No. 10 case arising from the equity transfer dispute between Delixi Company and Gudi Company, Delixi Company's Civil Complaint stated that, in accordance with the relevant agreements and supplementary agreements, Gudi Company transferred 300,000,000 restricted and circulating shares of Gudi Technology Company held by Iti Company to Delixi Company at a price of 210 million yuan, and confirmed that the restriction period of 30,000,000 shares was from August 16, 2012 to August 15, 2015. After the agreement was signed, Delixi Company paid a performance bond of 12 million yuan according to the contract transfer. If, after the payment terms are fulfilled, in accordance with the agreement between the two parties in the supplementary agreement, part of the dividend payment of 9.6 million yuan due to 30,000,000 shares of Delixi Company may be used as the performance bond or transfer price payable to Gudi Company. In addition, Delixi Company also paid 8 million yuan to Gudi Company. Since then, Gudi Company began to have breached the contract before the expiration of the restriction and neglected to perform or cooperate with the relevant obligations of the equity transfer transaction, including its failure to register the deregistration of 4 million shares before June 30, 2015. On August 11, 2015, Delixi Company sent a letter to Gudi Company, urging Gudi Company to open a condominium account before August 14, 2015, so that Delixi Company could pay 110.4 million yuan to the condominium accounts of both parties in accordance with the agreement. Delixi Company also sent special personnel to Gudi Company to coordinate the opening of accounts, but Gudi Company still delayed for various reasons. Based on the above-mentioned non-cooperation of Gudi Company, the follow-up matters stipulated in the agreement could not be promoted, so the lawsuit was filed. The filing date of the complaint is September 21, 2015.
In the (2015) Yue Gao Fa Min Si Chu Zi No. 11 case arising out of the equity transfer dispute between Xing Jianya and Gudi Company, Xing Jianya's Civil Complaint stated that Gudi Company transferred 30,000,000 restricted and circulating shares of Gudi Technology Company held by Iti Company to Xing Jianya for 240 million yuan, and confirmed that the restriction period of the subject shares was from August 16, 2012 to August 15, 2015. After the signing of the agreement, Xing Jianya paid a performance bond of 127 million yuan according to the agreement, and in accordance with the supplementary agreement, part of the dividend of 2.6 million yuan due to Xing Jianya's 300,000,000 shares was used as the performance bond to be paid to Gudi Company. Subsequently, Gudi Company began to have breach of contract before the expiration of the restriction, and neglected to perform or cooperate with the relevant obligations of the equity transfer transaction, and failed to open a condominium account as scheduled. On August 11, 2015, Xing Jianya sent a letter to Gudi Company, urging Gudi Company to open a condominium account before August 14, 2015, so that Xing Jianya could pay the balance to the condominium account in accordance with the agreement. Xing Jianya also sent someone to Gudi Company to coordinate the opening of accounts, but Gudi Company still delayed for various reasons. Based on the above-mentioned non-cooperation of Gudi Company, the follow-up matters stipulated in the agreement could not be promoted, so the lawsuit was filed. The filing date of the complaint is September 21, 2015.
In the (2015) Yue Gao Fa Min Er Chu Zi No. 18 case arising out of the equity transfer dispute between Yongrui Company and Gudi Company, Yongrui Company's Civil Complaint stated that Yongrui Company and Gudi Company and others agreed to transfer 40 million restricted shares of Gudi Technology Company held by Gudi Company to Yongrui Company, with a total transfer price of 320 million yuan. After the contract was signed, Yongrui Company paid a performance bond of 172.8 million yuan in accordance with the contract. The balance shall be paid to the condominium account according to the agreement after the expiration of the restriction period of the transferred shares in accordance with the terms of the transfer contract, and shall be used to register the change of shares after the debt is paid off. Sale period is until August 15, 2015. However, before the expiration of the restriction, Gudi Company began to default in bad faith. In June 2015, Without the consent of Yongrui Company, Gudi Company pledged the transferred shares again, increasing the amount of financing, of which 8.05 million shares have been judicially frozen. On August 14, 2015, Gudi Company violated the provisions of the share transfer contract and applied to the Shenzhen Stock Exchange and Gudi Technology Company for major asset restructuring without soliciting the opinions of Yongrui Company, requiring Gudi Technology Company to start a temporary suspension of trading on August 17, 2015. At the same time, after the expiration of the restriction period, in the case of Yongrui Company's repeated urging to handle the delivery procedures, Gudi Company has always prevaricated and delayed in various ways. The above-mentioned acts of Gudi Company have seriously violated the signed Share Transfer Agreement and its supplementary agreements, obstructed the proper performance of the contract with actual acts, and seriously endangered the realization of the purpose of the contract of Yongrui Company. Now, after repeated unsuccessful consultations between the parties, Yongrui Company filed a lawsuit in the case. The filing date of the complaint is August 21, 2015.
The Announcement on the Judicial Freezing of the Equity of controlling Shareholders (No. 2015-068) states: On August 11, 2015, the Company received the "Share Freezing Data (August 11, 2015)" issued by the Shenzhen Branch of China Securities Depository and Clearing Co., Ltd., and the Guangzhou Yuexiu District People's Court conducted a judicial freeze on August 10, 2015 for the 8052128 shares of the Company's pre-IPO institutional restricted shares held by the Company's controlling shareholder, Gudi Company. The period is from August 10, 2015 to August 9, 2018. As of the date of this announcement, Gudi Company holds 142146800 shares of the Company, accounting for 41.13% of the total share capital of the Company, and has cumulatively pledged frozen 142071420 shares, accounting for 41.11% of the total share capital of the Company and 99.95% of the shares of the Company held by it. The judicial freeze of 8052128 shares, accounting for 2.33% of the total share capital of the company and 5.66% of the shares of the company held by it.
The Announcement on judicial freezing of the controlling shareholder's equity and judicial waiting list (No. 2015-079) states that On August 28 and August 31, 2015, Gudi Technology Co., Ltd. received the "Share Freezing Data (August 27, 2015)", "Judicial Waiting For Freezing Data (August 27, 2015)", "Share Freezing Data (August 28, 2015)" issued by The Shenzhen Branch of China Securities Depository and Clearing Co., Ltd. Judicial Waiting Freeze Data (August 28, 2015)", knowing that the Zhuhai Intermediate People's Court conducted judicial freezing and judicial waiting freeze on the shares of the company held by the company's controlling shareholder, Gudi Company, on August 27 and August 28, 2015, and the court of first instance carried out judicial waiting freeze on the shares of the company held by Gudi Company on August 28, 2015. The details are as follows: 1. Judicial freezing situation: (1) Judicial freezing authority: Zhuhai Intermediate Court (2015 Zhuhai Zhongfa Baozi No. 72), judicial freezing quantity: 92094672 shares, freezing period: August 27, 2015 to August 26, 2018; (2) Judicial freezing authority: Zhuhai Intermediate Court (2015 Zhufa Zhizi No. 72), judicial freezing quantity: 42,000,000 shares, freezing period: August 28, 2015 to August 26, 2018. 2. Judicial waiting freeze situation: (1) Judicial waiting freezing authority: Zhuhai Intermediate Court (2015 Zhu Fa Zhi Zi No. 72), judicial waiting frozen quantity: 8052128 shares, judicial waiting freeze period: 36 months, entrustment date: August 27, 2015; (2) judicial waiting freezing organ: court of first instance [(2015) Yue Gao Fa Li Bao Zi No. 20], judicial waiting frozen quantity: 100146800 shares, judicial waiting freeze period: 36 months, Date of entrustment: August 28, 2015; (3) Judicial waiting freezing authority: Court of First Instance [(2015) Yue Gao Fa Li Bao Zi No. 22], number of judicial waiting freezes: 100146800 shares, judicial waiting freeze period: 36 months, entrustment date: August 28, 2015. As of the date of this announcement, Gudi Company holds 142146800 shares of the Company, accounting for 41.13% of the total share capital of the Company, and the cumulative pledge of frozen 142071420 shares, accounting for 41.11% of the total share capital of the Company, accounting for 99.95% of the share capital of the Company it holds; the cumulative judicial freezing of 142146800 shares, accounting for 41.13% of the total share capital of the Company and 100% of the shares of the Company; and the cumulative judicial freezing of 208345728 shares.
The court of first instance held that this case was a dispute over liability for damages for property preservation in litigation. According to the claims and litigation grounds of both the litigation and the defense, there are two main points of contention in this case: whether Xiamen International Bank is a qualified defendant in this case, and whether Xiamen International Bank Zhuhai Branch and Xiamen International Bank should bear the liability for compensation for the wrongful application for preservation.
On the question of whether Xiamen International Bank is a qualified defendant in this case. Paragraph 2 of Article 22 of the Law of the People's Republic of China on Commercial Banks stipulates: "Branches of commercial banks that do not have legal personality and carry out business in accordance with the law within the scope of the authorization of the head office shall bear the civil liability of the head office." "Since the applicant for property preservation involved in the case, Xiamen International Bank Zhuhai Branch, as a branch of a commercial bank, is not an enterprise legal person that can independently bear civil liability, Gudi Company insisted on listing Xiamen International Bank as a co-defendant in this case, which did not violate the law. Xiamen International Bank requested the court of first instance to reject Gudi Company's lawsuit on the grounds that it was not a party to the financial loan contract involved in the case and that Xiamen International Bank Zhuhai Branch had independent litigation subject qualifications, which lacked legal basis and was not supported.
On the issue of whether Xiamen International Bank Zhuhai Branch and Xiamen International Bank should bear the liability for compensation for the wrongful application for preservation. According to Article 105 of the Civil Procedure Law, if there is an error in the application for preservation, the applicant shall compensate the respondent for the losses suffered as a result of the preservation. Because the law does not have special provisions on the constituent elements of the application for interim compensation liability, such tort liability is general tort liability in terms of liability composition, and the provisions of paragraph 1 of Article 6 of the Tort Liability Law of the People's Republic of China (hereinafter referred to as the Tort Liability Law) shall apply. Based on the constituent elements of general tort liability, Gudi Company claimed that Xiamen International Bank Zhuhai Branch was liable for compensation for the wrongful application for preservation of the property involved in the case, and should prove the following three elements of facts: Xiamen International Bank Zhuhai Branch had subjective fault; Gudi Company suffered actual losses; and there was a causal relationship between Xiamen International Bank Zhuhai Branch's application for preservation and Gudi Company's losses. Only if the above three elements are established at the same time, Xiamen International Bank Zhuhai Branch shall bear the liability for compensation for the error of applying for preservation in accordance with the law. In this regard, the analysis is as follows:
First, the existing evidence cannot prove that Xiamen International Bank Zhuhai Branch was subjectively faulty with intent or gross negligence when applying for preservation. According to Article 100 of the Civil Procedure Law, the application for litigation preservation is a litigation right of the parties, so only if the applicant abuses the right, that is, the applicant has intentional or gross negligence in the wrong preservation, can the applicant for preservation be determined to be subjectively faulty. In the (2015) Zhuzhong Fa Min Si Chu Zi Case No. 35, Xiamen International Bank Zhuhai Branch requested Gudi Company and Weixiong Group to repay the loan 35803200 yuan and the corresponding interest, penalty interest, compound interest and the cost of realizing creditor's rights, and applied for litigation preservation of the property of Gudi Company and Weixiong Group up to 37 million yuan, indicating that the subject matter of the litigation request of Xiamen International Bank Zhuhai Branch was equivalent to the amount of property preservation it applied for. At the same time, the (2015) Zhuzhong Fa Min Si Chu Zi No. 35 Civil Mediation Letter has confirmed that Gudi Company still owes Xiamen International Bank Zhuhai Branch a loan principal of 35,803,191.75 yuan and its corresponding interest, penalty interest, compound interest, etc. Therefore, in view of the fact that the amount of the application for preservation by the Zhuhai Branch of Xiamen International Bank is comparable to the amount of the subject matter of its litigation claim, and the conservators Gudi Company and Weixiong Group also clearly confirmed the fact of defaulting on the relevant loans in the (2015) Zhuzhong Fa Min Si Chu Zi No. 35 Civil Mediation Document, then the Zhuhai Branch of Xiamen International Bank was not at fault when applying for preservation. Moreover, in order to resolve the relevant financial loan contract dispute, Gudi Company has confirmed the facts of litigation preservation in the (2015) Zhuzhong Fa Min Si Chu Zi No. 35 Civil Mediation Document, and voluntarily assumed all the preservation fees, and now it is filing this case again, which is contrary to the integrity of the litigation.
Gudi Company's claim that Xiamen International Bank Zhuhai Branch's application for preservation was erroneously based on the following three grounds: the value of the mortgaged property provided by Weixiong Group was more than twice the amount of the subject matter of the litigation claim, and there was no situation that made it difficult to enforce the judgment; the value of the seized property far exceeded the litigation claims of Xiamen International Bank Zhuhai Branch by tens of times; when Gudi Company submitted an application for property preservation reconsideration, requesting that the freezing of the 11 bank accounts of Gudi Company and the shares and 142146800 shares of Gudi Technology Company held by Gudi Company be lifted immediately. Knowing that Gudi Company was in a critical period of equity transfer and that 142071420 shares had been used for pledge financing, Xiamen International Bank Zhuhai Branch applied to the Zhuhai Intermediate Court to revoke the property preservation of the mortgaged property and insisted on freezing the shares of Gudi Technology Company held by Gudi Company. In this regard, 1. According to the first paragraph of Article 100 of the Civil Procedure Law, the purpose of the property preservation system is to ensure the enforcement of effective judgments in the future. Although Weixiong Group provided mortgage security for the debts owed by Gudi Company with its property located at No. 13 Huan'an Road, Weihong Neighborhood Committee, Ronggui Town, Shunde City, in view of the certain market risks in the realization of the value of the real estate itself, and the current law does not prohibit creditors with mortgage rights from applying for property preservation, Xiamen International Bank Zhuhai Branch, as a creditor, applied for property preservation in order to fully ensure the realization of the creditor's rights, which does not constitute subjective fault. 2. According to article 102 of the Civil Procedure Law, preservation is limited to the scope of the request. After investigation, the Zhuhai Branch of Xiamen International Bank clearly stated in the application for property preservation that the property of Gudi Company and Weixiong Group was subject to a limit of 37 million yuan, and the amount of preservation did not exceed the scope of the litigation claims of Xiamen International Bank Zhuhai Branch. Although Xiamen International Bank Zhuhai Branch provided information that can be used to preserve property when applying for property preservation, the above-mentioned acts of Xiamen International Bank Zhuhai Branch were not at fault because the specific scope of seizure and freezing was examined and ruled by the accepting court in accordance with law. 3. When Gudi Company submitted an application for property preservation reconsideration, Xiamen International Bank Zhuhai Branch applied to the Zhuhai Intermediate Court to revoke the property preservation of the mortgaged property, which was a disposition of its own rights by Xiamen International Bank Zhuhai Branch. If Gudi Company believes that continuing to freeze the shares will cause it significant losses, it can apply to the court to lift the freezing of the shares by providing a guarantee. Therefore, xiamen International Bank Zhuhai Branch applied for revocation of property preservation of the mortgaged property involved in the case, and there was no fault.
Second, the evidence provided by Gudi Company could not prove that there was a causal link between its alleged economic losses and xiamen International Bank Zhuhai Branch's application for preservation. 1． Gudi Company claimed that because its shares of Gudi Technology Company were frozen by Xiamen International Bank Zhuhai Branch, equity transfer disputes occurred with Delixi Company, Xing Jianya and Yongdi Company, resulting in investment compensation and cost losses of 478296700 yuan. However, in the (2015) Yue Gao Fa Min Si Chu Zi No. 10 case arising out of the equity transfer dispute between Delixi Company and Gudi Company, the litigation grounds set out in the Civil Complaint of Delixi Company were that Gudi Company had begun to breach the contract before the expiration of the restriction period (August 15, 2015) and had neglected to perform or cooperate with the relevant obligations of the equity transfer transaction, including its failure to register the deregistration of 4 million shares before June 30, 2015, and delaying the opening of the condominium account for various reasons. In the (2015) Yue Gao Fa Min Si Chu Zi No. 11 case arising out of the equity transfer dispute between Xing Jianya and Gudi Company, the litigation grounds set out in Xing Jianya's Civil Complaint were that Gudi Company had begun to breach the contract before the expiration of the restriction period (August 15, 2015), and had neglected to perform or cooperate with the relevant obligations of the equity transfer transaction, and failed to open a condominium account as scheduled. In the (2015) Yue Gao Fa Min Er Chu Zi No. 18 case arising out of the equity transfer dispute between Yongrui Company and Gudi Company, the reasons for the litigation set out in the Civil Complaint of Yongrui Company were: Gudi Company began to breach the contract in bad faith before the expiration of the restriction period (August 15, 2015), pledged the transferred shares again in June 2015 without authorization, and 8.05 million shares of which had been judicially frozen, and applied for major asset restructuring without authorization on August 14, 2015. From the litigation reasons set out in the above-mentioned complaint, it can be seen that before the Zhuhai Intermediate Court carried out judicial freezing and judicial freezing of the shares of Gudi Technology Company held by Gudi Company on August 27, 2015 and August 28, 2015, the facts of breach of contract claimed by the relevant parties had already occurred, so the application for preservation by Xiamen International Bank Zhuhai Branch was not directly and necessarily related to the occurrence of the above-mentioned equity dispute. 2． Gudi Company claimed that it could not renew the loan because the shares of Gudi Technology Company it held were frozen, resulting in penalty interest, liquidated damages and compound interest losses of 43472986.57 yuan. However, the payment of penalty interest, liquidated damages and compound interest by Gudi Company to Shanghai Haitong Securities Asset Management Co., Ltd., Huaxing Bank Guangzhou Branch and Changsha Bank Guangzhou Branch were all legal liabilities arising from Gudi Company's late repayment of loans, and there was no causal relationship with Xiamen International Bank Zhuhai Branch's application for preservation.
Accordingly, since Gudi Company failed to produce evidence to prove that Xiamen International Bank Zhuhai Branch had subjectively intentional or gross negligence, nor was it able to produce evidence to prove that there was a causal relationship between its claimed losses and Xiamen International Bank Zhuhai Branch's application for preservation, gudi Company's claim for compensation for compensation for the wrongful application for preservation by Xiamen International Bank Zhuhai Branch could not be established. At the same time, because the direct compensation liability of Xiamen International Bank Zhuhai Branch could not be established, Gudi Company's litigation claim that Xiamen International Bank bear joint or several liability for compensation was rejected in accordance with the law.
As for Gudi Company's claim that the goodwill of the Gudi Technology Company held by it was frozen, it demanded that The Zhuhai Branch of Xiamen International Bank and Xiamen International Bank apologize to Gudi Company in public media such as China Securities News, Securities Times, Foshan Daily, Pearl River Commercial Daily, Sina.com, Sohu.com, and NetEase.com to apologize to Gudi Company and eliminate the adverse effects. As mentioned above, if Xiamen International Bank Zhuhai Branch is not at fault in the process of applying for property preservation, Xiamen International Bank Zhuhai Branch shall not be liable for relevant tortious liability. Moreover, this case is a dispute over liability for damages for property preservation in litigation, and does not involve the issue of the infringed unit's right to reputation. Therefore, Gudi Company's demand that Xiamen International Bank Zhuhai Branch and Xiamen International Bank apologize and eliminate adverse effects also lacked legal basis.
In summary, the court of first instance, in accordance with the first paragraph of Article 6 of the Tort Liability Law and Articles 105 and 142 of the Civil Procedure Law, ruled that Gudi Company's litigation claims should be rejected. The case acceptance fee of 2,650,649.08 yuan is borne by Gudi Company, and the jurisdiction objection acceptance fee of 100 yuan is borne by Xiamen International Bank Zhuhai Branch.
In the second instance, the parties did not submit new evidence.
This Court confirms the facts identified in the first examination.
This court held that, based on Gudi Company's appeal request and reasons and the defense opinions of Xiamen International Bank Zhuhai Branch and Xiamen International Bank, the focus of the second instance trial in this case was: whether Xiamen International Bank Zhuhai Branch and Xiamen International Bank should bear the liability for compensation for the wrongful application for preservation.
(1) Regarding whether xiamen international bank Zhuhai branch was at fault in applying for preservation.
This court holds that the people's court may, on the basis of the application of the other party, rule to preserve the property of a party in cases where the judgment may be difficult to enforce or cause other damage to the parties due to the conduct of one of the parties or other reasons. However, if the application is erroneous, the applicant shall compensate the respondent for the losses suffered as a result of the preservation. The liability for compensation for compensation for error in applying for preservation provided for in Article 105 of the Civil Procedure Law is general tort liability. According to the first paragraph of Article 6 of the Tort Liability Law, which stipulates that "the actor shall bear tort liability for infringing on the civil rights and interests of others due to fault", the applicant must be at fault in the constituent elements of the liability for damages. Regarding the determination of the applicant's fault, a comprehensive judgment should be made from the aspects of the subjective fault of the parties and the objective illegality of the conduct, combined with the facts of the case. From the perspective of subjective factors, the applicant should generally perform a reasonable and prudent duty of care, meet the general reasonable person standard, and have no intention or gross negligence. From an objective point of view, the applicant's application for property preservation should have a basic factual basis and legal basis, and there should be corresponding evidence to support his litigation claim, and there can be no obvious wrongdoing. Based on the facts ascertained in this case, this court believes that the existing evidence cannot yet prove that there was subjective fault of intent or gross negligence in the application for preservation by Xiamen International Bank Zhuhai Branch.
First of all, the Zhuhai Branch of Xiamen International Bank submitted an Application for Litigation Preservation to the Zhuhai Intermediate Court, stating that its request was: "Apply for litigation preservation such as sealing, seizing, freezing and other litigation preservation of the property of the respondent I and II." The amount of the applicant's application for interim measures is limited to RMB37 million. At the same time, the Zhuhai Branch of Xiamen International Bank submitted to the people's court the property information of the respondent that it learned, namely the relevant bank accounts opened by Gudi Company, the real estate of Weixiong Group located at No. 13 Huan'an Road, Weihong Community Residents Committee, Ronggui Street Office, Shunde District, Foshan City, and the shares and dividends of Gudi Technology Company held by Gudi Company. Judging from the content of the Settlement Agreement reached between The Zhuhai Branch of Xiamen International Bank and Gudi Company, Weixiong Group and Zhengye Company on the dispute over the financial loan contract, the parties confirmed that Gudi Company still owed Xiamen International Bank Zhuhai Branch more than 35.8 million yuan in loan principal and corresponding interest, penalty interest and compound interest. Therefore, xiamen International Bank Zhuhai Branch's request for litigation property preservation of Gudi Company and other assets within the limit of 37 million yuan has a legal basis and legitimacy. The Zhuhai Branch of Xiamen International Bank applied for a preservation amount of 37 million yuan, fulfilled a reasonable duty of care, and did not constitute a subjective intention to maliciously abuse the right of property preservation.
Secondly, the litigation property preservation in this case originated from the application of Xiamen International Bank Zhuhai Branch, and the people's court ruled after review to preserve the property of the respondents such as Gudi Company. On September 6, 2015, after Gudi Company submitted an application for property preservation reconsideration to the Zhuhai Intermediate People's Court, Xiamen International Bank Zhuhai Branch agreed to lift the seizure of the property involved in the case, and still retained the corresponding seizure measures for stocks and bank accounts. The Court held that although the Zhuhai Branch of Xiamen International Bank enjoyed the right of mortgage on the property provided by Weixiong Group located at No. 13 Huan'an Road, Weihong Community Residents' Committee, Ronggui Subdistrict Office, Shunde District, Foshan City, according to the relevant provisions of Articles 100 and 102 of the Civil Procedure Law, it did not prohibit the mortgagee from applying to the people's court for property preservation in order to realize the claim, nor did it prohibit the seizure of other property related to the case other than the mortgaged property. The first-instance judgment held that there was a certain market risk in the realization of immovable property itself, and that the current law did not prohibit creditors with mortgage rights from applying for property preservation.
Third, judging from the types and amounts of property finally seized by the Zhuhai Intermediate People's Court, the total amount of bank deposits was more than 260,000 yuan, and the total number of shares was 142146800 shares, and the amount of the above-mentioned seizure and freezing was limited to 37 million yuan. Gudi Company appealed that the market value of the shares had reached more than 1.2 billion yuan, far exceeding the 37 million yuan that Xiamen International Bank Zhuhai Branch applied for seizure, and that Xiamen International Bank Zhuhai Branch abused the property preservation system, and there was obvious subjective malice. The Court held that although the total value of the shares involved in the case far exceeded 37 million yuan, there was an objective fact that 99.95% of the shares had been pledged, and the remaining market value available for disposal was not clear. Moreover, although Xiamen International Bank Zhuhai Branch provided stock information when applying for property preservation, the specific scope of seizure and freezing was reviewed and ruled by the people's court accepting the property preservation in accordance with law. Under the circumstance that the zhuhai branch of Xiamen International Bank applied for property preservation with a clear amount of 37 million yuan, Gudi Company's appeal claim that Xiamen International Bank Zhuhai Branch was in a critical period of transfer and delivery by seizing shares that were in a critical period of transfer and delivery, in order to pressure Gudi Company to achieve subjective malice and fault with improper intentions, was not based on insufficient evidence and was not supported by this court.
(2) Regarding the issue of whether the compensation loss claimed by Gudi Company 47829670 yuan and whether it is established to eliminate the adverse impact in the public media.
As mentioned above, xiamen International Bank Zhuhai Branch shall not be liable for damages if it cannot be found to be at fault in its application for property preservation. Moreover, the causal relationship between the result of the damage and the tort is one of the necessary conditions for the actor to bear civil liability for the result of the damage or the wrongful state. For damages caused by the erroneous application for property preservation, the mere existence of the erroneous application for property preservation and the result of the damage are not enough to make the applicant liable for compensation, and Gudi Company should also prove that there is a causal relationship between the erroneous application for property preservation and the result of the damage. The Court held that it was not improper for the first instance judgment to find that the causal relationship was not established. Judging from the facts already ascertained in this case, the content of the Civil Complaint involved in the equity transfer dispute between Delixi Company, Xing Jianya, Yongrui Company and Gudi Company shows that the breach of contract claimed by the relevant parties occurred before the Zhuhai Intermediate Court took preservation measures against the shares of Gudi Company, and the reason for the above-mentioned transferee to file a lawsuit was not that the shares involved in the case were seized by the Zhuhai Intermediate Court. At the same time, Gudi Company also has no other sufficient evidence to prove that there is a legal causal relationship between the occurrence of its claimed losses and the property preservation application of Xiamen International Bank Zhuhai Branch, so Gudi Company's appeal claims against Xiamen International Bank Zhuhai Branch, Xiamen International Bank's compensation of its economic losses of 47829670 yuan and the elimination of adverse effects in the public media cannot be established, and this court does not support it.
In summary, Gudi Company's appeal request cannot be established and should be rejected; the first-instance judgment found that the facts were clear and the law was correct and should be upheld. In accordance with the first paragraph of article 170 of the Civil Procedure Law of the People's Republic of China, the judgment is as follows:
The appeal was dismissed and the original judgment was upheld.
The acceptance fee of the second-instance case is 280,948.35 yuan, which is borne by Guangdong Gudi Plastic Co., Ltd.
This judgment is final.
Chief Judge Zhang Yingxin
Judge Xi Xiangyang
Judge Qian Xiaohong
June 29, 2018
Legal officer assistant Wang Peng
Scrivener Wang Tianjin
Source: Civil Trials