In civil trial practice, one of the biggest difficulties in handling disputes over creditors' right of revocation is the determination of the constitutive elements. In the process of determining whether a creditor's right of revocation is constituted, the main elements of the evidence and facts, the debtor's compensated or uncompensated acts, and whether the beneficiary is aware that the debtor's act has caused damage to the creditor, should be combinedYangma Real Estate Sales Co., Ltd. v. Tiansheng Real Estate Development Co., Ltd., a dispute over the right of revocation of creditors, Luotian County People's Court of Hubei Province (2020) E 1123 Min Chu No. 3085, Luotian County People's Court of Hubei Province, Xiao ChenBasic facts of the case
At the end of 2015, when the defendant Tiansheng Real Estate Development Company developed the Tiansheng 60 Mansion project with insufficient funds, the company borrowed 950,000 yuan. In the case of being unable to repay the debts due, the defendant Tiansheng Real Estate Development Company reached an agreement with the third party Li and Qu, and the loan of 950,000 yuan was repaid by the third party, Li and Qu.
On January 3, 2016, the defendant Tiansheng Real Estate Development Company issued a receipt for the purchase price of 950,000 yuan to the third party, Mr. Li. On February 3, 2016, the defendant Tiansheng Real Estate Development Company and the third party Li and Qu respectively signed a contract for the sale and purchase of four sets of commercial houses, and the third party, Li and Qu, repaid the loan of 950,000 yuan on behalf of the company to offset the purchase price. The contract stipulates that the unit price of the commercial housing for the sale and purchase of four sets of shops is 1957 square meters, with a total area of 48528 square meters, the total price is 949998 yuan. Each of the four sets of shops has two floors, and the room numbers are 5-101F, 5-201F, 5-102F, 5-202F, 5-103F, 5-203F, 5-104F, and 5-204F. Now the above four sets of shops are occupied by the third party, Li Moumou and Qu Moumou.
The case of a dispute over a commercial housing entrustment sales contract between the plaintiff Yangma Real Estate Sales Company and the defendant Tiansheng Real Estate Development Company was filed and accepted by this court on April 8, 2016, with the case number (2016) E 1123 Min Chu No. 599.
In this case, the plaintiff, Yangma Real Estate Sales Company, filed a lawsuit with this court: 1The defendant paid the outstanding commission of 726373 yuan; 2.The defendant compensated 180,000 yuan for damages. The facts and reasons are as follows: On August 1, 2014, the plaintiff and the defendant signed the "Luotian 60 Mansion Project Marketing Planning Contract", stipulating that the plaintiff would provide marketing planning, advertising design and sales services for the "Luotian 60 Mansion Project" developed by the defendant. After the contract was signed, the plaintiff was unable to perform the normal sales of the contract due to the defendant's arrears of the project payment and other social financing, overdue delivery, and part of the ** being mortgaged and sealed. To this end, the plaintiff negotiated with the defendant several times to request the termination of the contract and the defendant to pay the relevant sales expenses and commissions owed, and the defendant agreed to terminate the contract, but the two parties could not reach an agreement on the number of houses sold by the plaintiff and the amount of commission.
In this case, the defendant Tiansheng Real Estate Development Company argued: 1. It was true that the plaintiff and the defendant had signed a contract for the sale of the house **, and the contract had been terminated on March 1, 2016; 2. The defendant has paid the consignment commission of 668,500 yuan as agreed in the contract, and no longer owes the plaintiff the commission; 3. For houses that have been seized, mortgaged, or repaid by the defendant with a house, the plaintiff should not include its sales performance and claim commission.
On March 21, 2017, this court rendered the (2016) E 1123 Min Chu No. 599 Civil Judgment in accordance with the law, and the judgment resulted that: 1. The defendant Tiansheng Real Estate Development Company shall pay a total of 721373 yuan (726373 yuan and 5,000 yuan) to the plaintiff Yangma Real Estate Sales Company within 10 days after this judgment takes effect; 2. Other litigation claims of the plaintiff Yangma Real Estate Sales Company are rejected.
In addition, after checking the case file (2016) E 1123 Min Chu No. 599, the sales contract of four sets of commercial houses signed by the defendant Tiansheng Real Estate Development Company and Li Moumou and Qu Moumou was not included in the sales of real estate by the plaintiff Yangma Real Estate Sales Company, nor was it included in the amount of commission awarded in the case.
2016) After the E 1123 Min Chu No. 599 Civil Judgment came into effect, the plaintiff, Yangma Real Estate Sales Company, applied to this court for compulsory enforcement, and on September 1, 2017, this court ruled to seal up the four sets of shops at issue in this case.
On October 11, 2019, this court issued a notice (2019) E 1123 Zhiyi No. 10-3 to the plaintiff Yangma Real Estate Sales Company, which stated: In the case of the dispute between your company and Tiansheng Real Estate Development Co., Ltd. over the entrustment of the commercial housing sales contract, Qu Moumou, who was not involved in the case, raised a written objection to the subject matter of enforcement, and a hearing was scheduled to be held at 9:30 a.m. on October 18, 2019 in the litigation service center of this court, and you are hereby notified to participate. On October 18, 2019, Yangma Real Estate Sales Company learned about the sale and purchase contract of four sets of commercial houses signed by Tiansheng Real Estate Development Company with Li Moumou and Qu Moumou.
Adjudication Results
The People's Court of Luotian County, Hubei Province rendered the (2020) E 1123 Min Chu No. 3085 Civil Judgment: rejecting the litigation claim of Yangma Real Estate Sales Company.
The court held that
This case is a civil dispute arising from legal facts before the implementation of the Civil Code, and the provisions of the laws and judicial interpretations at that time should be applied.
Article 74 of the Contract Law of the People's Republic of China stipulates that if the debtor transfers property at an obviously unreasonable low price, causing damage to the creditor, and the transferee is aware of the situation, the creditor may also request the people's court to revoke the debtor's act. The scope of the exercise of the right of avoidance is limited to the creditor's claim. The necessary expenses for the creditor to exercise the right of avoidance shall be borne by the debtor. Article 75 provides that the right of avoidance shall be exercised within one year from the date on which the creditor knows or ought to know the reasons for revocation. If the right of avoidance is not exercised within five years from the date of the debtor's act, the right of avoidance shall be extinguished.
Accordingly, the time limit for exercising the creditor's right of avoidance is limited by a double exclusion period, one year from the date on which the creditor knew or should have known the cause of avoidance, and five years from the date of the debtor's act.
On October 18, 2019, the creditor plaintiff Yangma Real Estate Sales Company learned that the defendant Tiansheng Real Estate Development Company and the third party Li Moumou and Qu Moumou had respectively signed a commercial housing sales contract for four sets of shops on February 3, 2016, and that it sent a complaint to this court by postal express on October 16, 2020, and the time of the creditor's revocation lawsuit filed by it did not pass the above-mentioned double exclusion period.
The issue in this case is whether the plaintiff Yangma Real Estate Sales Company's exercise of the right of revocation can be established, and this court discusses it from the following aspects:
First, from the perspective of the elements of the subject of the creditor's right of revocation, the occurrence of the creditor's right of revocation is premised on the existence of a real and clear creditor's right.
In this case, the effective (2016) E 1123 Min Chu No. 599 Civil Judgment has confirmed that the plaintiff Yangma Real Estate Sales Company has a legally due creditor's right of 721373 yuan against the defendant Tiansheng Real Estate Development Company.
Second, from the perspective of the debtor's requirements, the requirements for the establishment of the creditor's right of avoidance vary depending on the debtor's compensatory or gratuitous acts.
For remunerated acts, it is typical for the debtor to transfer property at an obviously unreasonable low price.
In this case, the unit price of the commercial houses sold by the defendant Tiansheng Real Estate Development Company to the third party, Li and Qu, was 1,957 yuan per square meter.
The Interpretation (II) of the Supreme People's Court on Several Issues Concerning the Application of the Contract Law of the People's Republic of China stipulates that the people's court shall confirm the "obviously unreasonable low price" as provided for in Article 74 of the Contract Law, based on the judgment of the general operator in the place of the transaction, with reference to the price department guidance price or market transaction price of the place of transaction at the time of the transaction, and comprehensive consideration of other relevant factors. If the transfer** does not reach 70% of the guide price or market transaction price of the place of transaction at the time of the transaction, it can generally be regarded as an obviously unreasonable low price.
Luotian County Shop Transaction** is well known in the Luotian County area, and the transaction of the shop at issue in this case was generally about 7,000 yuan square meters in 2016 according to the geographical conditions. Referring to the transaction of shops in Luotian County, the above-mentioned purchase of houses** is sufficient to be determined as an "obviously unreasonable low price", and the behavior of the defendant Tiansheng Real Estate Development Company's shop has reduced the property of the company as the debtor, so it should be determined that the debtor has committed fraud.
Third, from the perspective of the elements of the beneficiary, the subjective elements for the establishment of the right of revocation also include that the beneficiary, that is, the third party in this case, Li XX and Qu XX, must be aware that the debtor defendant Tiansheng Real Estate Development Company's transfer of property has caused damage to the creditor plaintiff Yangma Real Estate Sales Company.
Except as otherwise provided by law, the parties shall provide evidence to prove the facts on which their own claims are based or the facts on which they refute the other party's claims. Where a party fails to provide evidence or the evidence is insufficient to prove its factual assertions, the party who bears the burden of proof shall bear the adverse consequences.
In this case, the plaintiff Yangma Real Estate Sales Company should provide evidence to prove that the third parties, Li XX and Qu XX, knew that the transfer of property by the debtor defendant Tiansheng Real Estate Development Company to their husband and wife had caused damage to the creditor's rights of the plaintiff Yangma Real Estate Sales Company and other creditors.
The plaintiff Yangma Real Estate Sales Company's legal claim of 721373 yuan against the defendant Tiansheng Real Estate Development Company was only confirmed by the civil judgment of this court (2016) E 1123 Min Chu No. 599 on March 21, 2017, after the third party Li and Qu purchased four sets of shops. It is logically impossible for the defendant Tiansheng Real Estate Development Company to sell four sets of shops to a third party, Li and Qu, to cause damage to the creditor's rights that have not yet been confirmed, and it is also logically impossible for the corresponding buyers, namely Li and Qu, the third parties in this case, to know that their purchase of houses will cause damage to the creditor's rights enjoyed by the plaintiff Yangma Real Estate Sales Company in a court judgment one year later.
Accordingly, the plaintiff Yangma Real Estate Sales Company, as a creditor, transferred the property to the third parties in this case, Li XX and Qu XX, at an obviously unreasonable low price when the defendant Tiansheng Real Estate Development Company still owed it a commission of 721373 yuan, so that the cause of action that its claims could not be realized.
The plaintiff Yangma Real Estate Sales Company's lawsuit against the creditor's right of revocation must meet the above three constituent elements at the same time in order to be legally supported, and the lawsuit filed by it does not meet the third constituent element.
The plaintiff Yangma Real Estate Sales Company's claim for the creditor's right of revocation at this stage is not based on sufficient grounds, and this court does not support all the claims of the plaintiff Yangma Real Estate Sales Company.
In addition, the commercial housing sales contracts for four sets of shops signed by the original defendant Tiansheng Real Estate Development Company and the third parties, Li XX and Qu XX, did not violate the mandatory provisions on the validity of laws and administrative regulations, and the four contracts were all legal and valid. The defendant, Tiansheng Real Estate Development Company, argued that the contract signed under duress was invalid, but did not submit evidence to substantiate it, and that the contract concluded under coercion was a voidable contract in law, and it was invalid ab initio retroactively until the date of establishment after it was revoked in accordance with the law. Therefore, this court does not support the defense reasons of the defendant Tiansheng Real Estate Development Company.
Case Analysis
This case is a typical creditor's right of avoidance case, and in the course of the trial of this case, the key is to determine whether the plaintiff's right of avoidance is established. The focus of the case is: how to determine the three constituent elements of the creditor's exercise of the right of avoidance?
1. Background of the establishment of the creditor's right of avoidance.
The creditor's right of revocation refers to the right of the creditor to request the court to revoke the debtor's behavior that endangers the creditor's rights to maintain the debtor's liability property. This system originated in Roman law and was a concept created by the Roman lawyer Paul, so it is also called Paul's right of action. As a creditor's rights preservation system, it is intended to prevent the debtor's property from being improperly reduced, fully protect the interests of creditors, and improperly derogate from the debtor and endanger the realization of creditor's rights.
Articles 538, 539 and 540 of the Civil Code of the People's Republic of China and Article 74 of the Contract Law of the People's Republic of China stipulate that the creditor may apply to the court to revoke the debtor's misconduct, thereby preserving the debtor's property and enabling the creditor's claim to be repaid through the property to be preserved.
Because the debtor's liability property is an important guarantee for the realization of the creditor's claim. If the debtor is allowed to transfer property at will without compensation or at a low price, it will not only damage the interests of the individual creditor, but also damage the security and order of the transaction, so the law and judicial interpretations clearly prohibit the debtor from improperly derogating from the property. The legislative purpose of the creditor's right of avoidance system is to correct the debtor's improper derogation of property and restore the debtor's liability property, so as to ensure the realization of creditor's rights, enhance investor confidence, stabilize the transaction order, and practice the principle of good faith.
2. When reviewing the creditor's right of revocation, the premise is that there is a real and clear creditor's right
The creditor applies to set aside the debtor's unjust derogation, provided that the creditor has a true and legitimate claim against the debtor. If the creditor's creditor's rights and debts relationship with the debtor has not been confirmed by the litigation or approved by the debtor, the creditor shall provide evidence to prove that it has a true and legitimate claim against the debtor.
In this case, the effective (2016) E 1123 Min Chu No. 599 Civil Judgment has confirmed that the plaintiff Yangma Real Estate Sales Company has a legally due creditor's right of 721373 yuan against the defendant Tiansheng Real Estate Development Company.
3. The requirements for the establishment of the creditor's right of avoidance are divided into objective and subjective elements, and vary according to the debtor's compensatory or gratuitous acts.
The objective condition for the establishment of the creditor's right of avoidance is that the debtor's conduct jeopardizes the realization of the creditor's rights.
Whether the debtor's conduct has caused damage to creditors should be considered from two aspects:
First, the debtor's other assets are insufficient to pay off the debts due to its behavior, and in this case, the focus should be on the fact that the debtor objectively cannot pay.
On the other hand, if the creditor's claim cannot be fully repaid due to the debtor's acts, but the creditor's claim has a security interest, the creditor can only exercise the right of avoidance to the extent that the value of the collateral is insufficient to pay off the amount of the claim. If the value of the collateral is sufficient to secure the realization of the claim, the debtor's actions do not prejudice the claim, and the creditor cannot exercise the right of avoidance.
Article 74 of the Contract Law of the People's Republic of China distinguishes the debtor's derogation of property into paid acts and gratuitous acts, and establishes the constitutive elements respectively. With regard to the act of waiving the due creditor's right or transferring the property free of charge, as long as the act causes damage to the creditor, the creditor can exercise the right of revocation without examining the subjective intention of the debtor and the third party.
However, if the debtor transfers the property to the outside world by way of compensation but at an obviously unreasonably low price, it is not only necessary to cause damage to the creditor, but also the subjective element of the transferee's knowledge.
The mainstream view is that the debtor's inaction can be revoked if it refuses to accept the gift or bequest, because the purpose of applying for revocation is only to maintain the debtor's original strength, not to increase its strength, and the debtor's refusal to accept the gift or bequest has nothing to do with its liability property.
In this case, the unit price of the commercial houses sold by the defendant Tiansheng Real Estate Development Company to the third party, Li and Qu, was 1,957 yuan per square meter.
The Interpretation (II) of the Supreme People's Court on Several Issues Concerning the Application of the Contract Law of the People's Republic of China stipulates that the people's court shall confirm the "obviously unreasonable low price" as provided for in Article 74 of the Contract Law, based on the judgment of the general operator in the place of the transaction, with reference to the price department guidance price or market transaction price of the place of transaction at the time of the transaction, and comprehensive consideration of other relevant factors. If the transfer** does not reach 70% of the guide price or market transaction price of the place of transaction at the time of the transaction, it can generally be regarded as an obviously unreasonable low price.
Luotian County Shop Transaction** is well known in the Luotian County area, and the transaction of the shop at issue in this case was generally about 7,000 yuan square meters in 2016 according to the geographical conditions. Referring to the transaction of shops in Luotian County, the above-mentioned purchase of houses** is sufficient to be determined as an "obviously unreasonable low price", and the behavior of the defendant Tiansheng Real Estate Development Company's shop has reduced the property of the company as the debtor, so it should be determined that the debtor has committed fraud.
4. With respect to the elements of the assignee of the creditor's right of avoidance, the establishment of the right of avoidance requires that the assignee be aware that the debtor's conduct has caused damage to the creditor
The debtor's derogation of property from creditors is divided into paid and gratuitous. If the debtor transfers property externally for compensation but at an obviously unreasonably low price, the subjective element of the knowledge of the beneficiary, i.e., the assignee, is required while causing damage to the creditor.
In this case, the plaintiff Yangma Real Estate Sales Company should provide evidence to prove that the third parties, Li XX and Qu XX, knew that the transfer of property by the debtor defendant Tiansheng Real Estate Development Company to their husband and wife had caused damage to the creditor's rights of the plaintiff Yangma Real Estate Sales Company and other creditors.
The plaintiff Yangma Real Estate Sales Company's legal claim of 721373 yuan against the defendant Tiansheng Real Estate Development Company was only confirmed by the civil judgment of this court (2016) E 1123 Min Chu No. 599 on March 21, 2017, after the third party Li and Qu purchased four sets of shops. It is logically impossible for the defendant Tiansheng Real Estate Development Company to sell four sets of shops to a third party, Li and Qu, to cause damage to the creditor's rights that have not yet been confirmed, and it is also logically impossible for the corresponding buyers, namely Li and Qu, the third parties in this case, to know that their purchase of houses will cause damage to the creditor's rights enjoyed by the plaintiff Yangma Real Estate Sales Company in a court judgment one year later.
Accordingly, the plaintiff Yangma Real Estate Sales Company, as a creditor, transferred the property to the third parties in this case, Li XX and Qu XX, at an obviously unreasonable low price when the defendant Tiansheng Real Estate Development Company still owed it a commission of 721373 yuan, so that the cause of action that its claims could not be realized.
5. The exercise of the creditor's right of avoidance must satisfy both the subjective and objective elements, the debtor's compensated or uncompensated acts, and whether the beneficiary is aware that the debtor's acts have caused damage to the creditor
When examining whether the creditor's right of revocation is established, it is necessary to combine the subjective and objective elements, and at the same time distinguish between the debtor's behavior of repayment and gratuitous
The subjective element is that the debtor's conduct has caused damage to the creditor, and the objective element is that the debtor has committed an act that infringes on the realization of the creditor's rights. If the debtor has committed a compensatory act, the beneficiary, i.e., the assignee, is also required to know that the debtor's act has caused damage to the realization of the creditor's claim, and the creditor's right of avoidance can only be determined if the above three constitutive elements are met.
In this case, the plaintiff Yangma Real Estate Sales Company's lawsuit against the creditor's right of revocation must meet the above three constituent elements at the same time in order to be legally supported, and the lawsuit filed by the plaintiff did not meet the third constituent element. The plaintiff Yangma Real Estate Sales Company's claim for the creditor's right of revocation at this stage is not based on sufficient grounds, and this court does not support all the claims of the plaintiff Yangma Real Estate Sales Company.
In addition, the commercial housing sales contracts for four sets of shops signed by the original defendant Tiansheng Real Estate Development Company and the third parties, Li XX and Qu XX, did not violate the mandatory provisions on the validity of laws and administrative regulations, and the four contracts were all legal and valid. The defendant, Tiansheng Real Estate Development Company, argued that the contract signed under duress was invalid, but did not submit evidence to substantiate it, and that the contract concluded under coercion was a voidable contract in law, and it was invalid ab initio retroactively until the date of establishment after it was revoked in accordance with the law. Therefore, this court does not support the defense reasons of the defendant Tiansheng Real Estate Development Company.
Relevant Laws. Article 538 of the Civil Code of the People's Republic of China: Where the debtor disposes of property rights and interests free of charge by waiving its creditor's rights, waiving the guarantee of creditor's rights, transferring property free of charge, etc., or maliciously extends the time limit for the performance of its due creditor's rights, affecting the realization of the creditor's creditor's rights, the creditor may request the people's court to revoke the debtor's acts.
Article 539 of the Civil Code of the People's Republic of China Where the debtor transfers property at an obviously unreasonable low price, transfers the property of another person at an obviously unreasonable price, or provides security for the debts of others, affecting the realization of the creditor's creditor's rights, and the debtor's counterpart knows or should know about the situation, the creditor may request the people's court to revoke the debtor's act.
Article 540 of the Civil Code of the People's Republic of China The scope of the exercise of the right of revocation shall be limited to the creditor's creditor's rights. The necessary expenses for the creditor to exercise the right of avoidance shall be borne by the debtor.
Article 74 of the Contract Law of the People's Republic of China Where the debtor waives its due creditor's rights or transfers property free of charge, causing damage to the creditor, the creditor may request the people's court to revoke the debtor's act. If the debtor transfers the property at an obviously unreasonable low price, causing damage to the creditor, and the transferee is aware of the situation, the creditor may also request the people's court to revoke it.
The scope of the exercise of the right of avoidance is limited to the creditor's claim. The necessary expenses for the creditor to exercise the right of avoidance shall be borne by the debtor.
Article 75 of the Contract Law of the People's Republic of China stipulates that the right of revocation shall be exercised within one year from the date on which the creditor knows or should know the reason for revocation. If the right of avoidance is not exercised within five years from the date of the debtor's act, the right of avoidance shall be extinguished.