The Analysis Of A Dormant Capital Subscription Contract Dispute Between Bozhi And Hongyuan

Dormant capital subscription has been widely found in different kinds of corporations and there's been an increasing number of disputes about it. For dormant capital subscription is concerned with the relations between dormant partner and nominee shareholder, dormant partner and corporation as well as the third party, there are a great number of disputes about dormant capital subscription contract, shareholder qualification confirmation, ascription of share right, the legal status of dormant partners, the protection of dormant partners'rights and interests in reality. At present, there are only two judicial interpretations have brief provisions about dormant capital subscription, but for different problems and disputes in practice there is no systematic and explicit stipulation and no unified rules of judgment. Thus,from the aspect of judgment in reality there is still a need to make profound study about dormant capital subscription.Among the course of signing the "entrusted investment and custody agreement" between Bozhi and Hongyuan company, and transferring the share to a third party Deren company, the case is concerned with five focuses, including the effect of "entrusted investment and custody agreement", identification of the relation between Bozhi and Hongyuan company, ascription of stock right, whether Hongyuan constituted coercion, whether Hongyuan's aquisition of RMB 702,000,000 of the share transfer price belongs to unjust enrichment. By analysis of basic theories,general doctrines and related articles of laws about each focus, it reaches to the conclusion that, first, dormant capital subscription is not only regulated by contract law but also company law. Although according to the contract law the entrusted investment and custody agreement is effective but the convention about ascription of the share is only effective between the two party. In the external relationship, the ascription of share could only in accordance with the company law's regulation. Thus the share belongs to the nominee shareholder. Second, because Bozhi company belongs to the kind of dormant partner who does not exercise right, it's hard to identify that Bozhi has the shareholder's qualification, which results in the passive status of Bozhi company in transferring the related share. However,this can not lead to the conclusion that Bozhi company signed the payment provision of transferring the share by coercion. Finally, by analyzing the constitution condition of unjust enrichment and the act of disposition of Bozhi in the share transfer contract, we can identify that Hongyuan has validity foundation and does not constitutes unjust enrichment. By analyzing the whole case we can conclude that in the aspect of the legal status of dormant partner and the protection of dormant partners'rights and interests, current law has no enough regulation which reveals added risk of investing by an dormant capital subscription way.