An engineering company undertook an EPC project for industrial gas facilities, with the contract price increased through supplementary agreements to more than RMB 220 million. The project involved four units. After supply, installation and commissioning, disputes arose over performance test certificates and outstanding payments.
The contract treated a unit as having passed its performance test if testing was not completed within 120 days after handover for reasons not attributable to the contractor. The original account states that the third hydrogen unit met this condition and that meeting minutes recorded the relevant confirmation, but the certificate was not issued promptly. When arbitration was commenced, the contractor claimed more than RMB 30 million, together with liquidated damages and costs.
Li Shu’s team reviewed the contract, supplementary agreements, handover and testing records, meeting minutes and payment evidence. It checked the conditions and overdue dates for each payment and developed submissions on the deemed-pass clause.
After constitution of the China International Economic and Trade Arbitration Commission tribunal and before the hearing, the parties settled. The settlement confirmed that the third unit had passed, provided for issuance of the certificate, confirmed the end of the warranty period and arranged instalment payments of a remaining balance exceeding RMB 17 million.
The original account records a late-payment charge of 0.04% per day and a contractual entitlement to claim more than RMB 5.8 million in overdue interest if delay exceeded fifteen days. Arbitration and legal costs were to be borne as agreed. The precise amounts, triggers and interaction of these provisions are governed by the settlement and award.
The tribunal issued an award on the agreed settlement terms, recording the payment and performance arrangements. This was a settlement award, not a merits award granting the original claim of more than RMB 30 million in full. Nor does the existence of the award alone establish that all sums were actually collected.
The case illustrates the combination of contract evidence, analysis of payment conditions and negotiation. Comparable projects should preserve evidence at the handover, testing, payment and default stages and specify deadlines, conditions and consequences clearly in any settlement.