Skillful! The court and the person subject to enforcement have successively gone to different windows of the bank, and the bank where the money is transferred should be held liable

01Case index

(2021) Supreme Court Zhi Jian No. 564 Civil Enforcement Supervision Enforcement Ruling of a Chinese Branch, Wang and Others

02

Parties to the case

Complainant (interested party): China Construction Bank Corporation Lishu Branch. Executor of the application: Wang × Long. Executor: Jilin Tianhong Fertilizer Co., Ltd. Executor: Lishu County Modern Tianfeng Warehousing Co., Ltd. Executor: Hyundai Tianfeng Agricultural Group Co., Ltd. Executor: Siping Tianfeng Fertilizer Technology Development Co., Ltd. Executor: Yang ×.

03

Basic facts of the case

The Siping Intermediate People's Court ascertained that on October 21, 2016, the court froze the bank account deposit of 25 million yuan in the case of pre-litigation property preservation of loan contract disputes between Wang × and Jilin Tianhong Fertilizer Co., Ltd. (hereinafter referred to as Tianhong Company), Lishu County Modern Tianfeng Warehousing Co., Ltd. (hereinafter referred to as Modern Tianfeng Warehousing Company), and Modern Tianfeng Agricultural Group Co., Ltd. (hereinafter referred to as Modern Tianfeng Agricultural Company). and served the (2016) Ji 03 Cai Bao No. 10 Notice of Assistance in Freezing Deposits of 22 million ******** in the account of Hyundai Tianfeng Agricultural Company to assist in freezing the funds in the account of 22 million of Hyundai Tianfeng Agricultural Company. On November 28, 2016, the hospital issued a notice to the Lishu Sub-branch on the responsibility to recover the transferred funds (2016) Ji 03 Cai Bao No. 10, ordering the Lishu Sub-branch to recover the transferred money within 10 days from the date of service of the notice, but the Lishu Sub-branch failed to recover the transferred money. On April 28, 2017, ×the court rendered the (2016) Ji 03 Min Chu No. 90 Civil Judgment, ordering the judgment debtors Tianhong Company and Hyundai Tianfeng Agricultural Company to jointly pay Wang × 20 million yuan and interest. After the judgment was rendered, none of the persons subject to enforcement appealed, nor did they automatically perform the obligation to determine the judgment. Wang × Long applied for compulsory enforcement on June 27, 2017, and the Siping Intermediate People's Court filed the case with the case number (2017) Ji 03 Zhi No. 58. On July 13, 2017, Wang × filed an application, requesting the ISU Sub-branch to bear the liability for compensation with its own property within the unauthorized unfreezing and transfer of 24.5 million yuan frozen by the hospital. On October 26, 2017, the Siping Intermediate People's Court issued the (2017) Ji 03 Zhi No. 58-3 Enforcement Ruling, ruling that the Lishu Sub-branch should bear the liability of RMB 24.5 million to Wang × Long with its property within the unrecovered RMB 24.5 million. After the ruling was served, the Lishu Sub-branch filed an enforcement objection with the Siping Intermediate People's Court, requesting that the enforcement ruling of the Siping Intermediate People's Court (2017) Ji 03 Zhi No. 58-3 be revoked. The reason is: the Siping Intermediate People's Court (2017) Ji 03 Zhi No. 58-3 Enforcement Ruling found that the Lishu Branch unfroze the judgment debtor's deposits without authorization, resulting in the transfer of 24.5 million yuan of the judgment debtor's funds frozen by the Siping Intermediate People's Court, which is inconsistent with the facts. In the process of assisting the Siping Intermediate People's Court in handling the pre-trial preservation case, the bank has been actively cooperating with the court's preservation work, and there is no refusal to assist, let alone unauthorized unfreezing.

04

Adjudication Results

The Supreme Court held that the key issue to be examined in this case was whether the ISU Sub-branch should bear the responsibility of repaying the debts of the applicant for enforcement with its own property in the process of assisting in enforcement. In accordance with Article 33 of the Provisions of the Supreme People's Court on Several Issues Concerning the Enforcement Work of the People's Courts (for Trial Implementation) (effective July 8, 1998), and in light of the actual circumstances of this case, the analysis is as follows.

First of all, the understanding and application of the provisions of Article 33 of the Provisions of the Supreme People's Court on Several Issues Concerning the Enforcement Work of the People's Courts (for Trial Implementation) (effective as of July 8, 1998). This article stipulates: "If a financial institution unfreezes funds frozen by the people's court without authorization, resulting in the transfer of frozen funds, the people's court has the right to order it to recover the transferred funds within a specified period." If it fails to recover within the time limit, it shall be ruled that the financial institution shall be liable to the applicant for enforcement with its own property within the scope of the transferred funds. "The purpose is to prevent banks and other financial institutions from unfreezing funds in accounts that have been frozen by the people's courts without authorization, resulting in the loss of frozen assets, thereby infringing on the legitimate rights and interests of creditors. In view of the fact that the assisting obligor is not a party to the enforcement case, if the assisting obligor is required to bear liability to the creditor with its property, it should be strictly examined and applied. In this case, the enforcing court issued two notices of assistance in enforcement, one for the freezing of the account No. 7788 of the person subject to enforcement, and the other for the freezing of the account of the person subject to enforcement, No. 4115. There is no dispute about the execution of the freezing of account No. 7788, so it should be reviewed around the effectiveness of the freezing of account No. 4115 of the person subject to enforcement and whether the bank has unfrozen it without authorization.

Second, on the issue of the effective time for the court to serve a notice of assistance in freezing deposits. In accordance with the second paragraph of Article 1 of the "Provisions of the Supreme People's Court on the Sealing, Seizure and Freezing of Assets in Civil Enforcement by the People's Courts", it is stipulated that: "Where the adoption of sealing, seizure or freezing measures requires the assistance of relevant units or individuals, the people's court shall draft a notice of assistance in enforcement and serve it on the person assisting in enforcement together with a copy of the ruling. The ruling on sealing, seizure or freezing and the notice of assistance in enforcement shall take legal effect when served". Strictly speaking, the notice of assistance in freezing deposits takes legal effect from the time it is served, and the obligor of assistance has a legal obligation to assist in freezing. According to the ascertained facts, the time when the staff of the enforcement court served the notice of freezing account No. 4115 was 15:18:58 on October 21, that is, the notice of freezing took legal effect at that time. On October 21, CCB Jilin Branch approved the completion of the loan, and the loan money entered the 4115 account. At 15:09:15 on the same day, the staff of the person subject to enforcement had issued an order to the bank staff to entrust the payment of the funds in account No. 4115, which was earlier than the freezing act of the enforcement court. According to the evidence submitted by CCB, the list of staff operation records at window 14 showed that at 15:15:49, account 4115 was "frozen for corporate demand deposit business"; At 15:24:12, account 4115 "Withdrawal of corporate demand deposits". According to the information inquiry form for the judicial freezing of public deposits, the freezing time is 15:24:34, the "judicial freezing", the freezing status is "waiting", and the agreed freezing amount is 25 million yuan, and from the cumulative judicial freezing amount, it is also 25 million yuan, and the actual frozen amount is 0. Therefore, although the No. 4115 account was not frozen by other judicial authorities, the money was frozen in the bank's internal computer system when the enterprise personnel provided the relevant procedures for loan transfer business in accordance with the loan contract, and the objectively enforcing court failed to actually freeze the loan money on the No. 4115 account. The Lishu Sub-branch marked the word "waiting" on the receipt of the Siping Intermediate People's Court's Notice of Assistance in Enforcement. The Jilin High People's Court held that the effect of the court's judicial freeze could not be prevented or excluded by a non-judicial ruling, and that the Lishu Sub-branch could not wait for the court's judicial freeze to be frozen within the bank on the grounds that the bank's internal business was frozen, ignoring the objective fact that the person subject to enforcement in this case applied for payment earlier than the enforcement court's freezing, and further presumed that the Lishu Sub-branch had unfrozen the funds that had been frozen by the court without authorization.

Thirdly, the facts of this case have their own particularities, and it should be judged whether the bank has unfrozen without authorization based on the actual circumstances of the case. First, the enforcing court and the person subject to enforcement have successively gone to different windows of the bank to handle business, and the time is relatively close. On October 21, 2016, the staff of the enforcement court arrived at the No. 13 counter of the Lishu branch at 14:49:10, and the staff of the person subject to enforcement then arrived at the No. 14 window and went through the entrusted payment procedures at 15:09:15. At present, there is no evidence to prove that the bank staff has colluded with the person subject to enforcement. Second, after the enforcing court first froze account No. 7788, it found that the person subject to enforcement still had account No. 4115, and issued a notice of assistance in freezing account No. 4115, but when the notice was served, the person subject to enforcement had already gone through the withdrawal procedures at the adjacent window and had not actually frozen the relevant funds. Third, judging from the procedures and time for the staff of the two windows of the bank to handle the business, they are all within a reasonable range, and there are no abnormal circumstances such as deliberate delays.

Finally, although the two windows of the bank handled the business separately, they were reviewed by the same person, and the ISU Sub-branch should indeed bear the responsibility for negligence in the lax review, but whether it constitutes unauthorized unfreezing and payment should be analyzed and judged based on the facts of the case. The ISU sub-branch has been fined 500,000 yuan for failing to take timely measures, and it has assumed corresponding responsibility. There is no factual and legal basis for requiring it to be liable for the amount of money withdrawn by the person subject to enforcement.

In summary, the grounds of the complainant's appeal were established, and the objection ruling of the Siping Intermediate People's Court and the reconsideration ruling of the Jilin High Court found that the Lishu Branch undertook to unfreeze the funds frozen by the people's court without authorization, and was liable to the applicant for enforcement with its own property within the scope of the transferred funds, which was based on insufficient basis and should be revoked. The ruling reads as follows:

1. Revoke the Jilin Provincial High People's Court's (2021) Ji Zhifu No. 21 Enforcement Ruling;

2. Revoke the enforcement ruling of the Intermediate People's Court of Siping City, Jilin Province (2017) Ji 03 Zhiyi No. 8.