In September 2020, Penghua Company leased scaffolding steel pipes, fasteners and other equipment and materials from Tsingshan Company and Honggangxin Company for the construction of the "Wuhan Iron and Steel Company has two three sintering integration major modification project", and Tsingshan Company and Honggangxin Company as Party A (lessor) and Penghua Company as Party B (lessee) signed the "Construction Equipment Lease Contract" on specific leasing matters, and agreed on the types of leased items and the rental unit price, of which the steel pipe rent was 0.011 yuan/m/day. The fastener rent is 0.006 yuan/set/day, the takeover rent is 0.006 yuan/pcs/day, the top support rent is 0.025 yuan/root/day, and the I-beam rent is 0.06 yuan/m/day. Other expenses include fastener oil washing fee of 0.2 yuan / set, steel pipe transformation 1 yuan / piece (or 260 yuan / ton), top support bottom plate deformation and trimming 1 yuan / piece. When receiving and delivering goods, Party B shall pay the loading fee according to the trolley 20 yuan / ton, the large car 22 yuan / ton, 22 yuan / ton to pay the unloading yard stacking fee, 1 yuan / piece to pay the steel pipe bending and cutting fee, 0.2 yuan / set to pay the fastener oil cleaning fee, 0.5 yuan / set to pay the fastener screw nut loss fee, 0.5 yuan / only pay the top support oil cleaning fee, 20 yuan / root to pay the I-beam bending and cutting fee. The contract also stipulates that "the lease period is from September 20, 2020 to September 20, 2021, and upon the expiration of the lease period, Party B shall return the leased property and settle all rent and miscellaneous fees; Upon the expiration of the lease period, Party A has the right to cancel the contract at any time and require Party B to pay the balance and return all leased items. If Party B fails to return the leased property within the time limit, it shall be deemed that Party B agrees to continue to rent at twice the unit price of the rent agreed in this contract until the leased property is returned in full or full compensation is in place; When the parties A and B settle the total settlement, Party B shall compensate the remaining unreturned steel pipes, fasteners and other leased items according to the agreed standards, and if the compensation is not paid in time after settlement, the remaining unreturned leased objects shall still be calculated for rent until the date of payment of compensation; The rental is calculated from the date of shipment to the date of return, the lease period is less than 90 days, calculated as 90 days, and the lease period exceeds 90 days, calculated according to the actual number of days used. Use the invoice return order as the settlement document. Party B shall take the initiative to settle on the 25th of the month and pay the rent and miscellaneous fees at the end of the month. If the payment is overdue, Party B is willing to calculate interest at a monthly interest rate of 2% based on the amount owed, and bear liquidated damages at 30% of the amount owed. The above outstanding amount, if the lease period expires, includes the sum of rent, miscellaneous expenses and compensation for unpaid materials. ”
After the signing of the above contract, from September 23, 2020 to November 22, 2021, Tsingshan Company and Honggangxin Company successively supplied various types of building materials and equipment to Penghua Company according to their needs, and Penghua Company successively returned part of its leased properties and paid part of the rent to Tsingshan Company and Honggangxin Company. After the expiration of the lease period of the contract, the parties to the lease did not renew the lease contract, nor did they settle the fees, and so far some of the leased objects have not been returned, and Tsingshan Company and Honggangxin Company urged Penghua Company to apply for and urge it unsuccessfully, so they sued the court of first instance.
Tsingshan Company and Honggangxin Company filed joint litigation claims with the court of first instance: 1. Order to terminate the "Construction Equipment Leasing Contract" signed by Tsingshan Company, Honggangxin Company and Penghua Company; 2. Order Penghua Company to pay Tsingshan Company and Honggangxin Company a rent of 1502283.01 yuan as of September 30, 2022, and continue to pay subsequent rent according to the standard agreed in the contract until the date when all the lease materials are returned or discounted; 3. Order Penghua Company to pay 43,322 yuan in compensation for lost small items and miscellaneous expenses (top support fastener cleaning and oiling fee, force fee, freight) of 137255.4 yuan; 4. Order Penghua Company to pay Tsingshan Company, Honggangxin Company paid liquidated damages of 504,858.12 yuan (calculated as 30% of the total arrears of the above three claims); 5. Order Penghua Company to return 19,304.4 meters of steel pipes, 54,618 sets of fasteners, 1,356 sets of top supports, and 3,742 pipes to Tsingshan Company and Honggangxin Company, and if it cannot be returned, it will be compensated at a discount according to the market price standard (steel pipe 15 yuan/meter, fastener 4 yuan/set, top support 12 yuan/set, and 3.5 yuan/root); 6. The litigation costs of the case shall be borne by Penghua Company.
During the first-instance trial, the court of first instance presided over the reconciliation and accounting of Qingshan Company, Honggangxin Company and Penghua Company, and all parties unanimously confirmed that as of September 30, 2022, Penghua Company had accumulated 1 1448343 37255.4 yuan in rent and other expenses under the contract involved in the case (including 77654.4 yuan for oil washing, 59051 yuan for power and 550 yuan for freight for the repaid leased items), with a total amount of 1585598.4 yuan, and Penghua Company still has 17997 meters of steel pipe, 54618 sets of fasteners, 1356 sets of top supports, 3742 pipes, 1214 top support nuts, 79360 fastener nuts were not returned to Tsingshan Company and Honggangxin Company.
In addition, Tsingshan Company and Honggangxin Company also submitted to the court of first instance a written certificate issued by the Municipal Construction Equipment Leasing Chamber of Commerce on October 19, 2022, which reads: "It is hereby proved that according to the current trading market conditions of the steel pipe scaffolding building materials industry, I would recommend the reference base price as follows: steel pipe 15 yuan / meter, fasteners 4 yuan / set, top support 12 yuan / set, take over 3.5 yuan / root, top support nut from 3 yuan / piece." "Tsingshan Company and Honggangxin Company intend to prove the compensation standards for damages of unreturned leased property that they claim. After questioning at trial, Penghua Company believed that the above reference price standard was too high, but did not submit relevant counter-evidence or make a reasonable explanation on its objection claim, and the court of first instance accepted the purpose of proof of the evidence.
The court of first instance held that according to Articles 465 and 509 of the Civil Code of the People's Republic of China, contracts established in accordance with law are protected by law. The parties shall fully perform their obligations in accordance with the agreement. In the case, Tsingshan Company, Honggangxin Company and Penghua Company signed the contract involved in the case based on a genuine agreement, which did not violate the law, and the two parties established a legal and valid lease contract relationship, and both parties should perform their respective contractual obligations in accordance with the contract.
According to Articles 562 and 563 of the Civil Code of the People's Republic of China, the parties may agree on the reasons for one party to rescind the contract. When the cause of rescission occurs, the rescission holder may rescind the contract. For an indefinite contract with the content of continuing debts, the parties may rescind the contract at any time. In the case, although the lease contract involved in the case had drawn up a term clause for the lease, according to the agreement of the parties to the lease, when the original lease period expired and the leased object had not yet been returned, the contract had been converted into an indefinite lease, but Tsingshan Company and Honggangxin Company, as lessors, had the right to rescind the contract and take back the leased property at any time. At present, Tsingshan Company and Honggangxin Company claimed to rescind the contract by filing a case lawsuit, which was based on law, and the court of first instance supported it according to law.
According to Article 566 of the Civil Code of the People's Republic of China, after the contract is terminated, if it has not been performed, the performance shall be terminated; If performance has been performed, depending on the circumstances of performance and the nature of the contract, the parties may request restitution or take other remedial measures, and have the right to claim damages. In the case, Penghua Company had reconciled and reached an agreement with Tsingshan Company and Honggangxin Company on the amount of rent and miscellaneous fees under the contract involved in the case as of September 30, 2022, and the court of first instance partially supported the claim of Tsingshan Company and Honggangxin Company within the limit of the total amount of arrears jointly confirmed by both parties of 1,585,598.4 yuan. Tsingshan Company and Honggangxin Company appealed to Penghua Company to return this part of the leased property and to compensate the leased property that could not be returned according to the lease market price standard, which had a factual and legal basis, and the court of first instance upheld it according to law.
According to Article 585 of the Civil Code of the People's Republic of China, the parties may agree that when one party breaches the contract, it shall pay the other party a certain amount of liquidated damages according to the circumstances of the breach, and may also agree on the calculation method of damages arising from the breach. If the agreed liquidated damages are lower than the losses caused, the people's court or arbitration institution may increase them at the request of the parties; If the agreed liquidated damages are excessively higher than the losses caused, the people's court or arbitration institution may, at the request of the parties, appropriately reduce them. In the case, although the parties to the lease had agreed on a breach clause when concluding the lease contract involved in the case, after it had been determined that the lessee was liable for the price liability for its inability to return the leased property, the actual losses of Tsingshan Company and Honggangxin Company should be compensated to a considerable extent. Therefore, the court of first instance lowered the basis and standard of liquidated damages claimed by Tsingshan Company as appropriate, that is, based on the rent and miscellaneous fees accumulated by Penghua Company as of September 30, 2022, and calculated according to the loan market quotation rate announced by the National Interbank Lending Center for the same period to the date of settlement of the arrears from October 1, 2022.
The court of first instance ruled that: 1. Confirm the termination of the "Construction Equipment Leasing Contract" signed between Tsingshan Company, Honggangxin Company and Penghua Company; 2. Penghua Company shall return 17,997 meters of steel pipes, 54,618 sets of fasteners, 1,356 sets of top supports, 3,742 pipes, 1,214 top support nuts and 79,360 fastener nuts to Tsingshan Company and Honggangxin Company within 10 days from the effective date of the judgment; If Penghua Company fails to return the amount in full, it will be compensated for the unreturned part of the leased items according to the standards of 15 yuan / meter for steel pipes, 4 yuan / set of fasteners, 12 yuan / set of top support, 3.5 yuan / tube for takeover, and 3 yuan / nut respectively; 3. Penghua Company shall settle to Tsingshan Company and Honggangxin Company the outstanding rent and miscellaneous expenses of 1,585,598.4 yuan as of September 30, 2022 within 10 days from the effective date of the judgment, and pay the equipment occupancy fee according to the standard of 0.011 yuan/m/day for steel pipes, 0.006 yuan/set/day for fasteners, 0.025 yuan/root/day for top support, and 0.006 yuan/piece/day for takeover until the date when they actually complete the return or discount compensation of the leased items; 4. Penghua Company shall pay liquidated damages for overdue payment to Tsingshan Company and Honggangxin Company within 10 days from the effective date of the judgment (based on 1,585,598.4 yuan, calculated from October 1, 2022 according to the loan market quotation rate announced by the National Interbank Lending Center in the same period until the date of settlement of the arrears). 5. Other litigation claims of Tsingshan Company and Honggangxin Company were dismissed.
After the first-instance judgment, the defendant Penghua Company appealed.
The second instance held that, pursuant to Article 175 of the Civil Procedure Law of the People's Republic of China, the people's court of second instance should review the relevant facts and applicable law of the appeal request. The contract involved in the case is the true intention of the parties, does not violate the mandatory provisions of laws and administrative regulations, is legal and valid, and both parties should perform their respective obligations in accordance with the contract. Tsingshan Company and Honggangxin Company fulfilled their obligation to lease construction equipment according to the agreement, while Penghua Company failed to fulfill their obligation to pay rent. In accordance with the contract between the two parties and in accordance with the provisions of Articles 566 and 585 of the Civil Code of the People's Republic of China, the first instance ruled that it was not improper for Penghua Company to pay liquidated damages for overdue payment to Tsingshan Company and Honggangxin Company in accordance with the loan market quotation rate announced by the National Interbank Lending Center in the same period. Penghua's claim that liquidated damages should not be paid has no factual and legal basis, and the second instance did not support it. Although the Municipal Construction Equipment Leasing Chamber of Commerce is not a professional pricing agency, the written certificate issued by it is of reference significance. In the absence of counter-evidence against the price of the materials, it was not improper for the court of first instance to adopt the basic price recommended by the Municipal Construction Equipment Leasing Chamber of Commerce as the price of the unrefunded leased item, taking into account the agreement between the two parties that the material price was based on the market price. Article 29 of the Measures for Payment of Litigation Costs issued by the State Council stipulates that litigation costs shall be borne by the losing party, unless voluntarily borne by the winning party. Where the case is partially won or partially lost, the people's court shall determine the amount of litigation costs borne by the parties on the basis of the specific circumstances of the case. Therefore, in the event that Penghua Company had defaulted on the failure to pay rent, although the court of first instance did not fully support the request of Tsingshan Company and Honggangxin Company for liquidated damages, it was not improper to decide that Penghua Company should bear all the litigation costs according to the specific circumstances of the case.
Second-instance judgment: dismissed the appeal and affirmed the original judgment.