Lawyer Larry Wins Judgment for U.S. Buyer: Court Orders Shareholders of Dissolved Trading Company to Pay Approximately RMB 6 Million

At the end of 2022, a U.S. company purchased solar panels from a trading company based in Shijiazhuang, Hebei, with a total contract value of nearly one million U.S. dollars under DDP terms.

The U.S. client paid the full purchase price as agreed. The Chinese seller subsequently breached the contract: it delivered only about one-third of the goods, and the delivered panels did not conform to the contractual specifications at all, rendering them unusable in the U.S. market. The client raised objections immediately. The seller admitted to the shortfall in delivery and the non-conformity but failed to provide any actual compensation.

Before the dispute was resolved, the Chinese seller completed a simplified deregistration and closed the company — retaining the overpayment, refusing to pay contractual penalties, and seeking to shed all its debts through the dissolution of the corporate entity.

The U.S. buyer contacted Senior Partner Larry Zhou of Landing (Shenzhen) Law Office. After accepting the engagement, Attorney Larry contacted the boss of the counterparty on multiple occasions and, following several rounds of negotiations, facilitated a settlement agreement between the U.S. buyer and the counterparty. The agreement specifically stipulated the counterparty's liability for breach if it failed to refund the payment as agreed. When the counterparty did not honor the settlement agreement, Attorney Larry formally filed a shareholder liquidation liability lawsuit on behalf of the U.S. client, naming the two natural persons as co-defendants.

The case pursued two lines of liability: first, the signatory of the simplified deregistration undertaking was jointly and severally liable for all debts of the company pursuant to the written undertaking and relevant provisions of the Company Law; second, the sole shareholder of the single-member limited liability company, having failed to prove the independence of corporate property from personal property, was jointly and severally liable for all trade debts of the company.

Attorney Larry compiled the full evidentiary record, including the sales contract, cross-border payment vouchers, correspondence between the parties, the counterparty's corporate deregistration records, and the investor's deregistration undertaking, and filed claims with the court seeking an order that the two defendants jointly refund the payment for the undelivered goods, pay contractual penalties, and bear the legal fees, notarization and authentication costs, court acceptance fees, and preservation costs incurred by the buyer in pursuing its claims.

At trial, both defendants failed to appear in court without justifiable cause. Given the completeness and sufficiency of the evidence and the clarity of the facts, the court issued its judgment within half a month after the hearing, granting all claims in full. The court ordered the two defendants to refund the purchase price of approximately RMB 4.5 million, pay contractual penalties of approximately RMB 1.5 million, and bear the legal fees and notarization and authentication costs.

The U.S. client was very satisfied with the outcome and expressed strong recognition of Larry's work at both the settlement negotiation and litigation stages.