Attorney Abby Wang represented an employee of a US company won the lawsuit.

Background: A US company purchased clothing fabric from a Guangzhou company, but due to quality disputes, the US company did not pay the final payment. The Guangzhou company, concerned about the high time and cost of cross-border litigation, only sued the Chinese translator of the American company in China and demanded that the Chinese translator bear the compensation responsibility in this case.

Dismissal of the lawsuit
The judgment of this case is that the judge did not support Guangzhou company’s lawsuit. The judge’s explanation was that the evidence provided by Guangzhou company could not prove the existence of a buying and selling relationship between the translator of the American company and Guangzhou company. The payment method in this case was also that the American company directly paid Guangzhou company. According to the communication records between the two parties, the translator of the American company only played a role in communication and coordination in this case, and was not a party to the contract. Therefore, the translator of the American company cannot be listed as the defendant in this case.

Original text of a Chinese court judgment.

It is crucial to clearly identify both parties in the contract
The inspiration from this case is that in international trade, it is important to sign contracts and clearly specify the parties involved. If disputes arise and are brought to court, the court will judge the relationships between the parties based on the trading parties specified in the contract, such as whether a buyer-seller relationship exists, in order to determine who should be the defendant.

In most cases, our clients purchase from China through agents. When the agents export the goods, they find companies with export qualifications to sign contracts on their behalf. However, these companies are not the actual suppliers. This makes it difficult for our clients to provide strong evidence in case of disputes to prove the existence of a purchasing relationship with the actual supplier.

Risk prevention
When purchasing in international trade, it is important to sign contracts with the actual suppliers. Additionally, it is best to include all responsible parties in the contract, such as the purchasing agents and production factories, and require them to assume responsibility for the contract. If disputes arise and we need to sue in court, we can list all responsible parties as defendants based on the contract and require them to jointly assume liability for compensation. This will increase our chances of obtaining compensation and prevent the situation where we win the lawsuit but cannot collect damages because the defendants have no money.