Legal Analysis Of Qiang Mou V.Cao Mou,Hanlin Company Share Transfer Case

In a series of contracts in which investor Qiang invest in the target company i.e.Hanlin,Cao,who is the shareholder of the target company and the legal representative of the company,agrees that if the target company fails to list in a certain period of time,the investor has the right to ask the shareholders to "buy back" their shares,and the target company bears joint and several liability for the guarantee.After the target company determined that it could not be listed,the shareholders did not pay the equity transfer to the investor,and the target company did not bear joint and several security liability,so the investor sued the two companies to the court,requesting the legal representative of the target company to buy back their shares at a premium in accordance with the equity repurchase clause between the two parties,and requesting the target to bear joint and several security liability.The case was eventually retried by the Supreme Court and eventually upheld the investor’s claim.The author arranges the dispute of this case as follows: one is whether the equity repurchase clause of the agreed performance target between the investor and the shareholder is valid;the other is whether the clause of the target company providing guarantee for the shareholder is valid;and the third is the performance of the gambling liability of the shareholder and the target company.This case is actually a "gambling agreement" dispute,and there are many disputes in academic circles and in practice,and it involves the same controversial corporate guarantee issues.In the process of writing,the author makes a distinction between the validity of the dispute clause and the performance of legal responsibility,and analyzes the processing method of this kind of case from the two dimensions of contract law and company law.This paper first analyzes the nature of the equity repurchase clause between the investor and the original shareholder,and further answers the question of itseffectiveness after understanding its legal nature.The "share buyback" clause involved in the case is actually a gambling agreement between investors and shareholders.After defining this clause,we compare the similarities and differences between it and other similar behaviors,and make a legitimacy analysis combined with judicial practice.Secondly,it demonstrates the effectiveness of the guarantee clause provided by the target company for shareholders,and analyzes the normative nature of Article 16 of the Company Law,the standard of bona fide identification,and the particularity of the guarantee for gambling.Finally,this paper focuses on the legal liability of shareholders and target companies,compares the way of undertaking "gambling" liability with equity repurchase,cash compensation and joint and guarantee liability,and points out the obstacles to the performance of gambling liability,and it is also regulated by the principle of capital maintenance.