One afternoon in 1994, in a court in Fujian Province, Cao Dewang, the chairman of Fuyao Glass Company, who was sitting in the defendant's seat, looked directly at the judge in front of him, his eyes full of unyielding and angry.
At the climax of the trial, he suddenly stood up, his voice sonorous and powerful, piercing the silence of the courtroom, "Don't think I don't know that you collected 2 million!" This sentence exploded in the spacious courtroom like a bombshell, and everyone's eyes instantly focused on Cao Dewang's body.
As Cao Dewang's words fell, the entire courtroom fell into a brief silence. What happens next?
Contract dispute between Fuyao Glass and Fujian First Construction Company
In 1991, Fuyao Glass decided to build a new industrial village to meet the company's rapid development needs. The importance of this project is self-evident, as it is related to Fuyao's future production capacity and market expansion. In the bidding of many construction companies, the construction right was finally obtained by Fujian No. 1 Construction Company (referred to as Fuyi Construction).
Fuyao Glass signed a detailed construction contract with Fuyijian, clarifying various project standards and completion schedules. At the beginning of the project, Fuyijian showed high enthusiasm for work, and frequently communicated with Fuyao to confirm the design details and material supply chain. However, as the project progressed, the problem gradually emerged.
Fuyijian began to delay delivery times, mostly because of unstable material supply or poor coordination by the construction team. Although Fuyao was skeptical about these reasons, considering the progress of the entire project, it did not take drastic measures against Fuyijian at the beginning.
However, after the project entered the middle stage, the operation of Fuyijian began to become unacceptable. During a routine inspection, Fuyao found that some critical infrastructure projects, such as power supply and drainage systems, clearly did not meet the technical standards specified in the contract.
Further investigation revealed that Fuyijian not only cut corners on these key projects, but even subcontracted some of the sub-projects to other small outsourcing companies, which did not have the proper qualifications and were not mentioned in the original contract.
Serious quality problems exposed by project acceptance
When Fuyao carried out the project acceptance of the newly built industrial village, it found a number of unacceptable quality problems. The first thing the acceptance team noticed was a problem with the roofs of the warehouse area, which were experiencing extensive water leaks after a summer rainstorm. Water ran down the walls from the joints in the roof, causing damage to the materials inside.
In addition, water seepage problems have also been found in the basements of the industrial estates, which affect the use of the basements and even have potential structural safety risks. After conducting a more in-depth investigation, Fuyao's engineers determined that the main cause of the water seepage problem was the non-compliant construction of the roof and basement waterproofing layer.
Fuyao immediately reported these findings to Fuyijian and asked for rework. The report details of the non-conforming works are listed in detail, and the corresponding photographs and measurement data are attached as evidence. After Fu Yijian received the report, the company's project leader and technical leader were urgently recalled to face the situation.
In the subsequent meeting, Fuyao elaborated on the problems found during the acceptance process and emphasized the seriousness of the problems, pointing out that they violated the quality standards in the construction contract signed by both parties. Fuyao made it clear that due to these serious quality deficiencies, they would suspend the payment of the remaining works and asked Fuyijian to be responsible for the full rework costs.
Legal proceedings and bribery allegations
Instead of accepting the request to rework, Fu Yijian accused Fuyao of failing to pay for the project on time, which in turn led to a legal dispute. In the complaint filed with the court, Fu Yijian claimed that it had completed all the work tasks in accordance with the contract, and that Fuyao's delinquent behavior had caused them to face financial difficulties, so it requested the court to order Fuyao to pay the remaining project price and corresponding compensation.
The lawsuit has attracted some attention in the local area, because Fuyao, as a large enterprise in the region, has a dispute with its contractor that not only involves huge economic interests, but may also affect the stability of the local economy.
Just before the lawsuit was about to go to trial, Cao Dewang learned some disturbing news — rumors that Fu Yijian had paid a 2 million yuan bribe to the president in charge of the case to ensure an advantage in the upcoming legal battle.
This news caused an uproar within Fuyao. Some of Cao's subordinates and legal counsel raised in an internal meeting whether the company's interests should be protected in the same way. They believe that since the other party has tried to influence the outcome of the case through improper means, Fuyao may also need to take some measures to deal with the possible unfair verdict.
However, Cao Dewang is firmly opposed to such a proposal. He made it clear that Fuyao must rely on legal and just means to meet this challenge, even if it means facing a more complex and difficult legal battle. Cao Dewang instructed the legal team to thoroughly prepare every legal detail to ensure that the seriousness of Fuyijian's breach of contract and project quality problems could be fully demonstrated in court.
The first hearing of the court came quickly. Fuyao's team of lawyers entered the court with a thick body of documents and evidence, including engineering quality inspection reports, records of correspondence with Fuyijian, and technical reports evaluated by a third party.
These documents are all intended to prove that Fuyijian failed to meet the quality standards of the works stipulated in the contract, and that Fuyao's refusal to pay the final payment was a reasonable act based on the terms of the contract and the actual situation. Although Cao Dewang had serious doubts about the fairness of this legal battle, he chose to believe in the power of the law.
Justice and Prejudice in the Courtroom
In 1994, the lawsuit between Fuyao Glass and Fujian First Construction Company was heard in the Fujian Provincial Court. This legal dispute has attracted a lot of attention due to the huge amount of money involved and the importance of both parties in the local economy. In the courtroom, the atmosphere was tense with the representatives of both sides.
At the trial on the same day, Fu Yijian's legal team first made a statement, in which they explained in detail the economic impact of Fuyao's arrears on Fu Yijian, and tried to depict a dilemma caused by the rupture of the capital chain due to the client's non-payment.
They pointed out that Fuyao's request for changes during the course of the project had resulted in additional costs and delays, and that Fuyijian was only demanding its due amount within the scope of the contract. In court, Fuyijian's representatives submitted a series of documents and evidence, including copies of contracts, changes to work orders, and receipts for partial payments received, in an attempt to prove that Fuyao had not fully fulfilled its financial obligations.
Their statements were coherent, and each point sought to point to the same conclusion: Fuyao had failed to fulfill its payment obligations as agreed in the contract. Cao Dewang listened to the opponent's statement in the dock, and although his legal team had prepared sufficient rebuttal materials, he was dissatisfied with Fu Yijian's statement and the judge's attitude.
When Fu Yijian's lawyer finished his statement, there was silence in the venue for a while, and all eyes were focused on Cao Dewang. Cao Dewang stood up, and his lead lawyer first made a legal rebuttal. The lawyer listed in detail the quality review report provided by Fuyao and the results of the third-party evaluation agency, emphasizing that the suspension of payment due to substandard quality was reasonable and necessary.
The lawyer also raised the issue of Fuyijian's subcontracting to an uncertified outsourcer, arguing that it was a violation of the spirit of the contract and seriously affected the overall quality of the project. But the judge obviously didn't want to hear these words, and his various questions were confirming a fact in favor of Fu Yijian.
Cao Dewang stood up suddenly, his voice echoing in the courtroom, pointing directly at the misconduct of the judge and Fu Yijian, and publicly accusing the judge of accepting 2 million yuan from the other party, claiming that this behavior undermined the fairness of business and law.
Cao Dewang's words were direct and sharp, which made the atmosphere in the courtroom tense to the extreme. In the face of this sudden accusation, the president's face changed and he immediately announced an adjournment in order to calm the court and consider the handling of Cao Dewang's remarks.
After the adjournment, Cao Dewang and his team of lawyers urgently discussed the follow-up strategy. Although Cao's actions are extremely rare in court, his resolute attitude shows his strong demand for justice in this case.
The final verdict was with Cao Dewang's insistence
After a series of intense court debates and multiple adjournments, the case finally ushered in the verdict day. The final ruling of the court did not support Cao Dewang's claim, and found that Fuyao must pay the remaining project payment to Fu Yijian, and did not accept the validity of Cao Dewang's defense on the quality of the project.
When this verdict was announced in court, although it was silent, it caused a strong reaction within Fuyao. Despite numerous pieces of evidence and third-party assessment reports to support their position, Cao and his team failed to convince the judge that the serious defects in the quality of the works were sufficient to offset the payment of the final payment.
The court's decision was clearly based on the strict interpretation of contract law, i.e., under the express provisions of the contract, the obligation to pay should be fulfilled unless the other party's breach of contract can be clearly proved. Faced with such a verdict, Cao Dewang felt unacceptable, but he did not choose to give up.
After a short period of contemplation, he decided to continue his quest for justice through legal channels. He believes that only by continuing to fight can it be possible to change the misconduct of opponents and set an inviolable benchmark for the industry. Cao Dewang quickly instructed his legal team to prepare the appeal materials and appealed to a higher court.
The grounds of appeal focused on the trial court's failure to fully consider the serious problems with the quality of the works and the actual losses caused by these problems to Fuyao. They argued that the first-instance judgment failed to correctly apply the relevant legal provisions and ignored the actual impact of the agreement on the quality of the project in the contract.
However, during the appeal process, the High Court's decision still did not bring good news to Cao Dewang. Although Cao's legal team demonstrated the seriousness of the engineering issues and their potential impact on Fuyao's business in more detail on appeal, the High Court upheld the original verdict.
They argued that, despite some quality issues, Fuyao failed to demonstrate that these were sufficient to cancel the obligation to pay the balance under the contract. This series of legal setbacks did not deter Cao Dewang.
He has repeatedly expressed in public and internal meetings that he insists that the legal battle is not only for the direct interests of the company, but also for the maintenance of the company's level playing field in the industry. He pointed out that if they choose to back down because of difficulties, it may create a false demonstration effect for other companies, causing more companies to choose to remain silent in the face of injustice.
Resources:
Contract Dispute Case Archives between Fuyao Glass Company and Fujian First Construction Company