- Published on Monday, 30 September 2013 14:25
by Dan Harris
I am tired of feeling bad for people/companies who call or email me to say that they just bought this or that from China and they did not receive it or what they received is not even close to what they ordered and paid for. Happened to me twice yesterday:
- Restaurant owner in the Midwest bought two kitchen machines from China for about $15,000 for the two of them. Why? Because according to him, the same machines cost around $30,000 each in the United States. The machines he received did not work at all. Not at all. Neither of them. His requests to the seller to fix them or to accept a return were completely ignored and he wanted to know what my law firm could do to help. I told him pretty much nothing other than to write a letter in Chinese threatening to sue the offending company in China, which letter would almost certainly be ignored. He asked about suing in China and I told him that to do so, he would need to find a Chinese lawyer to take the case in the somewhat remote city in which the Chinese company is based and then he would need to pay that lawyer, along with the court filing fees, and who is to say that he would win in any event? And then if he does win, how will he actually collect on the judgment? He asked whether there is some sort of law in China mandating that companies accept returns. I told him that I was not aware of such a law, but that even if there were such a law, why should his Chinese manufacturer follow it? We ended the conversation with him saying that it would have been cheaper in the long run for him to have just bought the machines in the United States and with my agreeing with him.
- Retailer in the Midwest (pure coincidence) bought $23,000 of allegedly ceramic dish-ware, only half of which ever came and all of which was low grade plastic. Again, I had to tell the caller that it would not make sense to pay my firm anything to assist in what would almost certainly be a fruitless exercise. This person ended the call by saying she would never buy from China again. My reaction to that was to remain silent.
If you are going to be doing a one-time China product purchase (really not just from China, but from anywhere) without due diligence and a contract, you should know that what happened to these two companies could very well happen to you and that your recourse will be limited, at best. And if you are going to be doing a one time product purchase from China of an amount that does not warrant your engaging in at least some due diligence regarding your seller and/or in having an enforceable contract drafted, well then maybe you should reconsider.
Cause if the deal goes bad and you call me, I will not have much to tell you.
Dan Harris is founder of the Harris & Moure law firm, a boutique international law firm focusing on small and medium sized businesses that operate internationally. China is the fastest growing area for the firm. Dan writes ChinaLawBlog.com as a source of China legal and business information.