From: Ten Enforcement Cases for Recognition and Enforcement of Extraterritorial Arbitral Awards and Court Judgments

[Information of the parties involved]

Applicant: AAAA architectural design company.

Respondant: a Mr. Cui.

Basic Information of the Case

AAAA architectural design company has appointed a Mr. Cui as its chief representative in Beijing. At the end of 2008, AAAA architectural design company planned to withdraw from the Chinese market, but there was still a portion of the contract payment that had not been collected in China. a Mr. Cui was willing to use the brand and customer resources of AAAA architectural design company to establish his own company in China. After negotiation, the two parties signed a "Franchise Agreement", which agreed that a Mr. Cui would collect the outstanding debt on behalf of AAAA architectural design company, and the recovered amount would be provided to a Mr. Cui as a loan in AAAA proportion, At the same time, both parties agree that disputes arising from or related to this contract shall be finally resolved through arbitration in accordance with Danish arbitration law. Due to a Mr. Cui's unwillingness to repay the funds and loans collected by AAAA architectural design company, AAAA architectural design company applied for arbitration in Denmark. After being heard by the Danish Provisional Arbitration Tribunal, a final award was made, ruling that a Mr. Cui should pay more than 1.2 million yuan and corresponding interest and arbitration fees to AAAA architectural design company. After the final award came into force, a Mr. Cui has not fulfilled it, and an architectural design company applied to the Fourth Intermediate people's court of Beijing for recognition and enforcement.

The Fourth Intermediate people's court of Beijing, after reviewing the final award made by the Danish Provisional Arbitration Tribunal in accordance with the Convention on the Recognition and Enforcement of Foreign Arbitral Awards, ruled to recognize and enforce the final award.

In the first Enforcement case, AAAA architectural design company reached an Enforcement settlement agreement with a Mr. Cui. Due to multiple violations of the settlement agreement by a Mr. Cui, who failed to fully fulfill the agreed payment obligations within the agreed time and amount, AAAA architectural design company applied

Please resume enforcement. After the resumption of Enforcement, the presiding judge seized and froze the vehicles, bank accounts, and equity under a Mr. Cui's name, deducted the cash value of his insurance, and took mandatory measures to restrict high consumption. Afterwards, a Mr. Cui claimed that due to his father's illness and financial difficulties, he hoped to continue to fulfill the amount agreed in the settlement agreement, while AAAA architectural design company advocated for the original arbitration award to be executed. Due to significant differences between the two parties regarding the remaining amount to be paid, the presiding judge, on the basis of taking mandatory measures against a Mr. Cui in accordance with the law, organized multiple conversations between the two parties to reach a consensus. Eventually, a Mr. Cui fulfilled his repayment obligation, and the rights and interests of the creditors ruled by the Danish Interim Arbitration Tribunal were realized.

Enforcement Results

Both parties have reached an agreement on the remaining amount to be paid, and the person subjected to Enforcement has finally fulfilled all the obligations. The Enforcement of this case has been completed.

Typical significance

Based on the principle of judicial sovereignty in international law, an arbitral award made by an arbitral tribunal of a country has Res judicata and enforcement power only in its own country. If it wants to be effective in another country, it must be recognized and enforced by that country. If it cannot be recognized and enforced by a court of a country, the arbitral award won by the parties at any high price may be just a piece of waste paper. In this sense, The execution of foreign effective arbitration awards is not only a concrete manifestation of mutual respect for sovereignty and judicial comity among countries, but also the "last mile" to achieve the interests of the parties in the final judgment.

In this case, both China and Denmark are parties to the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (also known as the New York Convention). The Fourth Intermediate people's court of Beijing decided to recognize and implement the final award made by the Danish Provisional Arbitration Tribunal after reviewing the legal nature of the dispute in this case. In the execution process, the executing judge lawfully enforces the part that should be executed through appropriate procedures, forcing the parties to fulfill the obligations determined by foreign arbitration awards, and taking measures to seal up or freeze the name of the person being executed

Compulsory measures such as property, deduction of insurance cash value, and restrictions on high consumption have enabled the realization of the part of foreign arbitration awards that includes property payment content, fully protecting the legitimate rights of the applicant for enforcement, and demonstrating the international image of Chinese courts being fair, fair, efficient, and authoritative. At the same time, the court implemented the concept of good faith and civilized execution during the execution, fully considering the actual situation of all parties, and promoting active communication and negotiation between both parties on the basis of protecting the rights and interests of creditors to win, achieving satisfactory execution results for both parties. This provides a solid judicial guarantee for creating an honest and trustworthy international business environment, and is of great significance for promoting judicial exchange and cooperation among countries.

Expert comments

This case is a typical case of implementing the New York Convention and enforcing law in good faith. The Beijing Fourth Intermediate People's Court took numerous enforcement measures against the integrity of the person being executed in the case, effectively ensuring the execution of the Danish interim arbitration tribunal's award and fully protecting the legitimate rights of creditors; At the same time, taking into account the family difficulties of the person being executed, through multiple conversations and communication, both parties have reached an agreement on the amount of execution, reflecting China's determination to build an honest and trustworthy international business environment and the judicial temperature of civilized and friendly law enforcement, which is conducive to promoting judicial assistance and economic exchanges between China and other countries.