Analysis On The Case Of Dispute In Factoring Contract

Under the current economic situation,the rapid development of factoring business will undoubtedly bring more vitality to the market,which not only brings economic benefits to factors,but also eases the difficulties in financing and capital flow for small and medium enterprises.Because factoring business has multiple functions of collection,financing,credit risk guarantee,and debt management,the theoretical research on factoring contract disputes must be insightful and able to effectively guide practical work.However,the reality is that China has not yet formed a mature regulation and theoretical system,which causes many problems in practice.By analyzing 65 sample cases and three typical cases such as Huarong Xiangjiang Bank vs.Hunan Jingbaode Co.Ltd.,combining with the court’s judgments and related theory,This article discusses the focus of disputes such as the choice of jurisdictional clause conflicts in factoring contract disputes,the effect of false receivables on the effectiveness of factoring contracts,factoring agents’ repeated litigations,and the determination criteria for due diligence obligations.The conclusion is as follows: the choice of jurisdiction clause conflicts should be depending on the basic agreement according to relevant rules regarding debt assignment.In terms of the effect of false receivables on the effectiveness of factoring contracts,the effectiveness of the basic contract and factoring contract should be distinguished.The invalidity of the basic contract does not necessarily result in the invalidation of the factoring contract.After the factoring company has filed a lawsuit against the original creditor separately and has not been fully repaid,another lawsuit which is filed by the factor against the original debtor does not constitute repeated lawsuits.Because the two cases are based on different legal relationships and belong to different litigation targets.In terms of the standard of due diligence of factoring agents,it must not be limited to the formal review of the basic transaction text,but also to investigate the trade background and performance.Aiming at the above mentioned problems in the development of factoring business,on the one hand,it is necessary to accelerate the promulgation of relevant content of factoring contracts in the Civil Code and related legislation and judicial interpretations.On the other hand,the banking supervision departments should improve the factoring business procedures and internal loan approval system through industry regulations and accounts receivable registration system.