Against the backdrop of increasingly close global business interactions, cross-border trade disputes often pose greater challenges in resolution due to issues such as application of law and regional differences. In 2024, our legal team successfully handled a contract performance dispute involving an overdue payment owed to a machinery trading company from a Middle Eastern country (hereinafter referred to as the "Middle Eastern Company") by a Chinese enterprise. We not only helped the client recover the full amount of the overdue payment of RMB 1.87 million but also secured an additional payment of RMB 50,000 as liquidated damages from the defaulting domestic enterprise. The following is a detailed account of the entire case handling process, including specific timelines and key breakthroughs.

## I. Case Background: Clarifying the Timeline and Transaction Details
1. **Early Stage of Cooperation (January 2024)**: The Middle Eastern Company entered into a *Machinery Purchase Contract* with a Suzhou-based equipment manufacturing enterprise (hereinafter referred to as "Suzhou Company"). Under the contract, Suzhou Company was commissioned to customize 30 sets of precision machine tool parts for the Middle Eastern Company, with a total contract value of RMB 1.87 million. The core terms of the contract were clearly stipulated as follows:
   - **Payment Terms**: The Middle Eastern Company shall pay a 50% advance payment (RMB 935,000) within 7 days after the signing of the contract; the remaining 50% of the payment (RMB 935,000) shall be made after the goods are manufactured and pass the inspection by the representative of the Middle Eastern Company.
   - **Delivery Time**: The goods shall be manufactured and delivered to Shanghai Port by March 31, 2024.
   - **Liability for Breach of Contract**: If Suzhou Company fails to deliver the goods within 15 days beyond the agreed delivery date, the Middle Eastern Company shall have the right to terminate the contract and demand the return of the paid amount, and Suzhou Company shall pay liquidated damages at 5% of the total contract value.

2. **Early Stage of Contract Performance (January 10 - March 2024)**: The Middle Eastern Company made the advance payment of RMB 935,000 in accordance with the contract on January 10, 2024. Subsequently, it inquired about the production progress through emails on multiple occasions. From February to March, Suzhou Company postponed the delivery date to April 15 and then to April 30, citing "workers returning home for the Spring Festival" and "delayed supply by raw material suppliers" respectively, without providing any written proof for the delay.

## II. Outbreak of the Dispute: Timeline and Escalation of the Crisis
1. **Confirmation of Breach of Contract (May 5, 2024)**: As of May 5, Suzhou Company still had not delivered the goods and refused to allow the Middle Eastern Company to inspect the production situation at its factory. When the Middle Eastern Company communicated via international call, the person in charge of Suzhou Company even proposed that "the Middle Eastern client needs to pay an additional 30% of the amount to be prioritized for production," which clearly violated the contract agreement.

2. **Client's Dilemma (May 10 - 20, 2024)**: Due to its failure to deliver the parts to its downstream client on time, the Middle Eastern Company faced the risk of being claimed for liquidated damages under the downstream contract (approximately 200,000 USDs). Prior to this, the Middle Eastern Company had entrusted a translator to negotiate with Suzhou Company on its own, but the latter delayed the process on the grounds that "the contract does not clearly specify whether 'delayed raw material supply' constitutes a force majeure event." After the negotiation proved fruitless, the Middle Eastern Company entrusted our team to intervene.

## III. Legal Team's Intervention: Key Breakthroughs and Action Timeline
### (I) Evidence Collation Stage (May 21 - 25, 2024): Identifying 3 Core Breakthroughs
1. **Breakthrough 1: Countering Based on Contract Loopholes — Rejecting the "Force Majeure" Defense**  
   Suzhou Company claimed that "delayed raw material supply constitutes a force majeure event," but our team found that: the contract only stipulates that "unforeseeable and unavoidable events such as natural disasters and policy adjustments shall be deemed as force majeure," and does not include "issues related to raw material supply"; moreover, Suzhou Company could not provide proof of the delay from its raw material supplier (after verification by our team, the raw material supplier had actually completed the supply in mid-March). Therefore, the "force majeure" defense was invalid.

2. **Breakthrough 2: Securing Evidence of Contract Performance — Proving Suzhou Company's Fundamental Breach of Contract**  
   Our team assisted the Middle Eastern Company in collating key evidence:
   - 12 exchange emails between February and April 2024 (including attachments: "Production Progress Statement" sent by Suzhou Company, in which the email dated March 20 admitted that "production was halted due to workshop equipment failure," contradicting the claim of "delayed raw material supply");
   - Recording of the call on April 28, 2024 (notarized by a notary public, in which the person in charge of Suzhou Company clearly stated that "only 10% of the production has been completed so far, and additional funds are required to continue");
   - "Port Pick-up Reservation Record" issued by the third-party logistics enterprise (a Shanghai-based international freight company) entrusted by the Middle Eastern Company (proving that the Middle Eastern client had made preparations to receive the goods in accordance with the contract and had no breach of contract).

3. **Breakthrough 3: Linking to Downstream Losses — Increasing Leverage in Negotiations**  
   Our team guided the Middle Eastern Company to provide the *Purchase Contract* (including liquidated damages clauses) signed with its Dutch client and the "Breach of Contract Claim Letter" sent by the Dutch client (translated and notarized). We clearly informed Suzhou Company that if it continued to delay, it would not only be required to return the advance payment but also might be liable for the liquidated damages that the Middle Eastern Company would have to pay to its Dutch client (approximately RMB 1.4 million), significantly increasing the cost of its breach of contract.

### (II) Non-Litigation Negotiation Stage (May 26 - June 5, 2024): Lawyer's Letter + Specialized Negotiations
1. **May 26, 2024**: A *Lawyer's Letter* was sent to Suzhou Company, clearly putting forward 3 requirements:
   - Provide complete proof of production progress and a delivery plan within 3 days;
   - If the goods cannot be delivered on schedule, return the advance payment of RMB 935,000 and pay liquidated damages of RMB 93,500 (5% of the total contract value) within 7 days;
   - Inform Suzhou Company that if it refuses to perform the contract, our team will initiate legal proceedings and apply for property preservation (preliminary verification showed that Suzhou Company owned 2 workshops and a sum of bank deposits under its name, with the ability to repay debts).

2. **May 30 - June 5, 2024**: Breaking the Deadlock through Multiple Rounds of Negotiations  
   After receiving the Lawyer's Letter, Suzhou Company took the initiative to contact our team for the first time, but still insisted on "only being able to return 70% of the advance payment." Our team adopted a "phased pressure" strategy:
   - **First Round (May 30)**: Presented the email about Suzhou Company's "equipment failure" and the verification evidence of "raw materials having been delivered," exposing its lie and clarifying the fact of "fundamental breach of contract";
   - **Second Round (June 2)**: Provided the basis for calculating the downstream liquidated damages of the Middle Eastern Company, and informed Suzhou Company that "if legal proceedings are initiated, the court will most likely rule that Suzhou Company shall bear all the downstream losses";
   - **Third Round (June 5)**: Proposed a "compromise plan" — Suzhou Company shall return the full advance payment of RMB 935,000 by June 15, and the Middle Eastern Company shall waive the claim for downstream liquidated damages, but Suzhou Company shall pay an additional RMB 50,000 as "compensation for the overdue occupation of funds"; otherwise, legal proceedings will be initiated immediately.

### (III) Litigation Preparation and Final Resolution (June 6 - 15, 2024)
1. **June 6 - 10, 2024**: Promoting Property Preservation in Parallel  
   Since Suzhou Company was still hesitant, our team submitted an *Application for Property Preservation* to the People's Court of Suzhou Industrial Park on June 6, applying for the freezing of RMB 1 million in bank deposits under Suzhou Company's name (covering the advance payment and liquidated damages). The court issued a *Ruling on Property Preservation* on June 8 and successfully froze the relevant account on June 10.

2. **June 12, 2024**: Suzhou Company Made the Full Payment  
   After its account was frozen, Suzhou Company completely abandoned the delay tactic and paid the full amount of RMB 985,000 (including the advance payment of RMB 935,000 and the compensation of RMB 50,000) to the designated account of the Middle Eastern Company on June 12. On the same day, the two parties signed a *Settlement Agreement*, which clearly stipulated that "after Suzhou Company fulfills its payment obligation, the Middle Eastern Company shall withdraw the application for property preservation, and there shall be no other disputes between the two parties regarding this case."

3. **June 15, 2024**: Case Conclusion  
   Our team assisted the Middle Eastern Company in submitting an *Application for Withdrawal of Property Preservation* to the court. The court ruled to lift the freeze on Suzhou Company's account, and the case was successfully resolved.

## IV. Case Insights: Summary of 3 Key Experiences
1. **"Precisely Avoid Pitfalls" When Signing Contracts**: Cross-border trade contracts should clearly specify the specific circumstances of "force majeure," the calculation standards for breach of contract damages, and the dispute resolution methods (such as agreeing on "jurisdiction by Chinese courts" or "international arbitration") to avoid subsequent disputes caused by ambiguous clauses. In this case, it was precisely because the contract did not list "delayed raw material supply" as a force majeure event that we had a basis to reject the other party's defense.

2. **"Keep Comprehensive Records" for Evidence Preservation**: Exchange emails, call recordings, payment vouchers, and third-party certifications (such as logistics records and notarized documents) should be sorted out and filed in a timely manner. In this case, the contradictory emails from Suzhou Company and the notarized call recording became the core evidence to prove its breach of contract.

3. **"Combine Firmness and Flexibility" in Dispute Resolution**: Priority should be given to resolving disputes through non-litigation methods such as lawyer's letters and negotiations to reduce time costs; if the other party delays, it is necessary to resolutely initiate property preservation and exert pressure through means such as asset freezing to force the other party to face the problem seriously. In this case, the rapid progress of property preservation was the key turning point that prompted Suzhou Company to make the full payment.