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CISG CASE PRESENTATION

China 24 May 2005 Shanghai No. 2 Intermediate People's Court [District Court] (Medical products case) [translation available]
[Cite as: http://cisgw3.law.pace.edu/cases/050524c1.html]

Primary source(s) of information for case presentation: Case text

Case Table of Contents


Case identification

DATE OF DECISION: 20050524 (24 May 2005)

JURISDICTION: People's Republic of China

TRIBUNAL: Shanghai No. 2 Intermediate People's Court [District Court]

JUDGE(S): Unavailable

DOCKET NUMBER: Unavailable

CASE NAME: Sinochem Shanghai Co. Ltd. v. Kolorit TM Co. Ltd.

CASE HISTORY: Unavailable

SELLER'S COUNTRY: People's Republic of China (plaintiff)

BUYER'S COUNTRY: Russian Federation (defendant)

GOODS INVOLVED: Medical products


Classification of issues present

APPLICATION OF CISG: Yes [Article 1(1)(a)]

APPLICABLE CISG PROVISIONS AND ISSUES

Key CISG provisions at issue: Article 30

Classification of issues using UNCITRAL classification code numbers:

Unavailable

Descriptors: Burden of proof

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Editorial remarks

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Citations to case abstracts, texts, and commentaries

CITATIONS TO ABSTRACTS OF DECISION

(a) UNCITRAL abstract: Unavailable

(b) Other abstracts

Unavailable

CITATIONS TO TEXT OF DECISION

Original language (Chinese): Click here for Chinese text of case; see also CISG-China Case [IPC/21]: <http://aff.whu.edu.cn/cisgchina/en/news_view.asp?newsid=57>

Translation (English): Text presented below

CITATIONS TO COMMENTS ON DECISION

Unavailable

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Case text (English translation) [second draft]

Queen Mary Case Translation Programme

Shanghai No. 2 Intermediate People's Court

Sinochem Shanghai Co. Ltd.
v.
Kolorit TM Co. Ltd.

24 May 2005

Translation [*] by Jing Li [**]

Plaintiff (hereinafter, "[Seller]), Sinochem Shanghai Co. Ltd. (formerly named "Sinochem Shanghai Import & Export Corporation") [of the People's Republic of China], filed a lawsuit with this Court against Defendant (hereinafter, "[Buyer]"), Kolorit TM Co. Ltd. [of the Russian Federation]. On 16 February 2004, the Court formed a collegiate bench, and on 9 November 2004, held a public court session. The [Seller]'s attorney attended the court session; the Court had served a summons on the [Buyer], but the [Buyer] did not attend the court session. The Court heard this case by default according to the relevant law. This case is concluded.

POSITION OF THE PARTIES

[Seller]'s claims

On 22 November 2002, the [Buyer] placed a purchase order for medical products via e-mail to the [Seller]. Thereafter, as agreed, the [Seller] delivered to the [Buyer] in installments medical products worth US $49,088. The [Buyer] paid US $32,169 in installments, but had not made the remaining payment of US $16,919. The parties could not solve the dispute by negotiation. Therefore, the [Seller] filed this action against the [Buyer] requesting the Court to require the [Buyer] to make the remaining payment of US $16,919 and interest of US $500 thereon.

The [Buyer] did not submit a response to the Court. Nor was the [Buyer] present to respond at the court session.

In order to prove its case, the [Seller] submitted the following evidence:

   1)    A copy of the printed e-mail dated 22 November 2002 sent by the [Buyer] to the [Seller], to prove that the [Buyer] had required quotations and that the [Buyer] intended to purchase medical device model No. NJP600 for US $26,634 and medical device model No. SHK200 for US $15,254.
 
   2)    Copies of the printed e-mail sent by the [Buyer] to the [Seller] and the [Seller]'s response (without qualified translated versions in Chinese), to prove that the [Seller] had received a deposit of US $12,566.40 from the [Buyer], which was 30% of the contract price.
 
   3)    The copy of a facsimile dated 6 June 2003 sent from A/S Aizkraukles Bank (City of Riga, Latvia) to Harris Bank International (New York, U.S.), which specified "customer order: Forport Co. Ltd.", to prove that the [Buyer] notified the [Seller] that it had made payment of US $13,602 to the [Seller] via the bank, and that the [Seller] had confirmed its receipt of the payment.
   4)    The copy of a facsimile dated 8 September 2003 from VEB Bank (City of Riga, Latvia) to Deutsche Bank Trust Company (America), to prove that the [Seller] had received [Buyer]'s payment of US $6,000.
 
   5)    Two copies of facsimiles dated 9 June 2003 sent from A/S Aizkraukles Bank (City of Riga, Latvia) to Harris Bank International (New York, U.S.), which specified "customer order: Forport Co. Ltd.", to prove that the [Buyer] promised to make two payments of US $20,000 and US $2,919, respectively, to the [Seller] via Forport Co. Ltd.
 
   6)    The copy of the Situation Explanation dated 8 July 2003 issued by Shanghai Pudong Investment Bank, to prove that the [Seller] did not receive the two payments of US $20,000 and US $2,919, respectively, referred to in 5) above.
 
   7)    The printed e-mail (unknown date) that the [Buyer] wrote in response to the [Seller]'s complaint of not receiving the two payments, which stated that the bank investigation of the non-receipt of the two payments of US $20,000 and US $2,919, respectively, under contract No. 02RU31SH2920078 of 15 July 2002 would be completed by 15 July 2003, and that if the result was negative, the [Buyer] promised that it would remit the payment to the [Seller]. This is submitted to prove that the [Buyer] promised to investigate the non-receipt of the payments.
 
   8)    The facsimile from the [Buyer] to the [Seller] promising to make payment of the remaining US $22,919 under contract No. 02RU31SH2920078 dated 15 July 2002 in four installments by 25 September 2003, with proof that the [Buyer] had only paid US $6,000 to the [Seller] thereafter, and had not made payment of US $16,919.
 
   9)    The copy of the inquiry letter from Bian Xiaodan of Shanghai Tianhe Pharmaceutical Machinery Co. Ltd. to the Economic and Commercial Counselor's Office of the Embassy of China in Russia dated 21 August 2003, to prove the process of the [Seller]'s demand for the contract price.
 
   10)    A written statement by Kirillov Sergey dated 15 February 2004, to prove that the [Buyer] had confirmed the non-payment of the contract price of US $16,919, and that it had promised to pay it within two months.
 
   11)    A printed copy of relevant e-mails in English dated 16 April 2003 (without any qualified translated versions in Chinese), to prove that the [Seller] and the [Buyer] had confirmed the contract price.
 
   12)    The copy of the air bill of lading, packing list issued by the [Seller], and the pro forma invoice (all of which in English, but without any qualified translated versions in Chinese), to prove that the [Seller] had performed its obligation of delivery, but as requested by the [Seller], the amount written on the pro forma invoice was US $20,000.

[Buyer]'s defense

The [Buyer] was not present at the court session to cross examine on the above evidence submitted by the [Seller], nor did the [Buyer] submit any evidence to the Court.

FACTS

In regard to the evidence submitted by the [Seller], the Court finds that

   1)    The authenticity of Evidence item 1) cannot be confirmed, and therefore, the Court does not verify it.
 
   2)    The authenticity of Evidence item 2) cannot be confirmed, and there is no qualified translated version in Chinese. This does not conform to the formal requirements of documentary evidence in foreign languages. Thus, the Court does not verify it.
 
   3)    The authenticity of Evidence items 3) - 5) cannot be confirmed, and their content cannot prove that it was the [Buyer] who made payment to the [Seller]. Therefore, these items of evidence are not relevant to the present case. Thus, the Court does not verify them.
 
   4)    The authenticity of Evidence item 6) cannot be confirmed because the [Seller] cannot submit the original, and therefore, the Court does not verify it.
 
   5)    The authenticity of Evidence item 7) cannot be confirmed, and the content "non-receipt of the two payments of US $20,000 and US $2,919, respectively, under contract No. 02RU31SH2920078 of 15 July 2002" shows that the indicated date is earlier than the date (22 November 2002) on which the [Buyer] placed the purchase order in dispute. This evidence is not directly relevant to the present case. Thus, the Court does not verify it.
 
   6)    The content of Evidence item 8) is not directly relevant to the present case, and therefore, the Court does not verify it.<
 
   7)    The content of Evidence item 9) is the communication between a third party and an institution, which is not relevant to the present case. The Court does not verify it.
 
   8)    The content of Evidence item 10) cannot prove the identity of the writer of the statement. Judging from the form of the statement, it also cannot be proved that the person signed the statement "Kirillov Sergey" was authorized by the [Buyer] to issue such a repayment guarantee. The content of this written statement is not relevant to the payment in dispute, and thus, the Court does not verify it.
 
   9)    The authenticity of Evidence item 11) cannot be confirmed, and there is no qualified translated version in Chinese. This does not conform to the formal requirements of documentary evidence in foreign languages. Thus, the Court does not verify it.
 
   10)    As for Evidence item 12), the authenticity of the air bill of lading cannot be confirmed; the packing list and the pro forma invoice were issued unilaterally by the [Seller] and were not accompanied by the respective qualified translated versions in Chinese. This does not conform to the formal requirements of documentary evidence in foreign languages. Therefore, the Court does not verify them.

REASONING OF THE COURT

On 20 September 2004, the [Seller]'s name was changed from Sinochem Shanghai Import & Export Corporation to the present one. This is confirmed by the Court via relevant materials from the company registration authority.

Jurisdiction

After receiving this case, the Court sent the [Buyer] materials such as the copy of Memorandum of Complaint and requested its defense. The [Buyer] did not submit any response within the regulatory period. Therefore, it shall be considered that the Court has jurisdiction over the present case.

Applicable law

Since the [Buyer] is a company registered in the Russian Federation, the disputed contract is considered a foreign related contract. According to the relevant law, the parties are authorized to select the applicable law to their dispute. Although the [Seller] requested that the law of the People's Republic of China should be applicable to the case, it did not provide relevant evidence proving that both parties agreed on Chinese law as the applicable law. Therefore, the Court does not support this claim. Since the parties to the sales contract are located in different Contracting States of the United Nations Convention on Contracts for the International Sale of Goods (1980) (hereinafter, "CISG"), the Court finds that CISG should apply to the current dispute.

[Seller]'s claims

A party must provide evidence proving its own claims; otherwise, it shall bear the unfavorable results that may arise from failure to do that.

According to Article 30 of the CISG:

"The seller must deliver the goods, hand over any documents relating to them and transfer the property in the goods, as required by the contract and this Convention."

The [Seller] requested the contract price from the [Buyer]. Hence, the [Seller] has the duty to prove that it had performed its contractual obligations. The [Seller] did not provide any relevant evidence such as the written sales contract, proof of the delivery of goods, proof of customs declaration, in order to demonstrate that the [Seller] had delivered the disputed goods, handed over all related documents, and transferred the property in the goods. Therefore, the Court does not confirm that the [Seller] had made delivery of the medical products worth US $49,088 in installments to the [Buyer]. The Court notes that this conclusion would hold even if the [Seller] provided a written statement issued by the person in charge from the [Buyer] about its plan to make payment of the unpaid contract price. This is so because the [Seller] did not provide other evidence on the fact that this statement was made under the authorization by the [Buyer]. In addition, the contract price referred to in the statement cannot be proved to be directly relevant to the contract price in dispute. Therefore, the Court does not support the [Seller]'s claim that the [Buyer] should be required to pay the remaining contract price of US $16,919 and the interest of US $500 thereon. The [Seller]'s claims lack sufficient factual and legal bases.

RULING OF THE COURT

To sum up, according to Article 130 of the Civil Procedure Law of the People's Republic of China (hereinafter, "Chinese Civil Procedure Law"), Article 30 of the CISG, Article 64(1) of the Chinese Civil Procedure Law, and Article 2 of the Several Provisions of the Supreme People's Court on the Evidence for Civil Actions:

   -    The Court rejects all of the [Seller]'s claims.
 
   -    The litigation fee of the present case is RMB 4,391, which the [Seller] shall pay.

Should there be an objection to this ruling, the [Seller] may appeal by submitting a Petition of Appeal with a copy for the other party through this Court to the Shanghai High People's Court within 15 days after the judgment is served; the [Buyer] may appeal by submitting a Petition of Appeal with a copy for the other party through this Court to the Shanghai High People's Court within 30 days after the judgment is served.


FOOTNOTES

* All translations should be verified by cross-checking against the original text. For purposes of this translation, Plaintiff Sinochem Shanghai Co. Ltd. of the People's Republic of China, is referred to as [Seller] and Defendant Kolorit TM Co. Ltd. of the Russian Federation, is referred to as [Buyer]. Amounts in the currency of the United States (dollars) are indicated as [US $]; amounts in the currency of the People's Republic of China (renminbi) are indicated as [RMB].

** Jing Li, LL.M., University of Texas at Austin, School of Law; Master of Law, Sun Yat-Sen University School of Law, China; LL.B., Sun Yat-Sen University School of Law, China.

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Pace Law School Institute of International Commercial Law - Last updated May 12, 2010
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