MWC – Chapter 67 Economic Dispute

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Sleeping in the soft moon cave bed is quite comfortable.

But whether there’s something to do or not, he has to get up early every morning and rush to the Jinshun Hotel, where the “Prosecutor’s Group” is located, to report.

Listening to the prosecutors’ discussions on various angles of their strategies is quite interesting. Moreover, there’s good news: the survivor boy being treated in the hospital is improving and may be able to give a full testimony. Whether he can appear in court is another matter. The prosecution hopes to have his statement recognized as valid by the court without him needing to testify in person.

At noon, after treating Wang Xiaohu, the tag along, to a delicious meal, Lu Ming returned to Wind Bao Club Room 408 for a nap, only to receive an unexpected visitor—Wei Baozeng, Executive Director of Baoyin Bank, accompanied by Councilor Meng Dezhu. After introducing the two, Meng Dezhu made an excuse and left.

Wei Baozeng, in his early fifties, looked extremely composed and stable. According to Meng Dezhu’s introduction, Wei Baozeng is the Whip of the Dapeng Party’s North Gate Branch and one of the 11 Qing faction councilors.

The Dapeng Party is entirely different from small parties like Meng Dezhu’s. Even the small North Gate branch is fully equipped and highly structured.

There is a Party Leader, known as Elder Qing, the second-in-command Party Minister, and the third-in-command Party Whip, Wei Baozeng. Below them are three permanent committees: the Urban Policy Forum Committee, the Rural Policy Forum Committee, and the Political Donation Management Committee, each staffed with about a dozen permanent employees.

The Party Minister typically doesn’t run for councilor but is crucial in managing the party’s daily operations.

As the Party Whip, Wei Baozeng manages party discipline and executes the Party Leader’s directives.

Lu Ming was somewhat surprised by this visit from such a high-ranking figure but didn’t show it on his face.

Although over fifty, Wei Baozeng appeared more muscular than Lu Ming, indicating regular exercise. However, he looked haggard and had graying hair, contrasting with his otherwise robust demeanor.

“Lawyer Lu, if you agree to join the Dapeng Party, this is our North Gate Branch’s promise to you!” Wei Baozeng took out a sheet of paper and placed it in front of Lu Ming. He was also puzzled why Elder Qing valued this young man so highly, offering conditions that seemed fantastical. But Elder Qing was like a god in the North Gate Branch, and even if others disagreed, he had to follow the Party Leader’s decisions.

Lu Ming glanced at the paper and was slightly taken aback.

The North Gate Branch of the Dapeng Party promised to appoint him as Deputy Director of the Rural Policy Committee and fully support his run for the North Gate’s 49th district councilor election at the end of the year.

“Lawyer Lu, have you finished reading?” Wei Baozeng extended his hand, and Lu Ming handed the paper back.

Wei Baozeng lit the paper with a match, threw it into the ashtray, and waited until it turned to ashes before pouring some water over it.

“Lawyer Lu, our branch has another condition: these promises are contingent on the prosecution winning the case against the Japanese, or if the case isn’t concluded by the end of the year.”

Lu Ming smiled. This condition wasn’t even written down, only conveyed verbally.

It was clear that his performance in this case would be a key promotional point for the Dapeng Party.

If the prosecution won, it would be great. If the case wasn’t concluded yet, it could still be used for promotion. However, if they lost, there would be nothing to promote.

So, if he lost the case before the end of the year, all current promises from the Dapeng Party would be null and void.

Politics, a realm he hadn’t yet entered, already hinted at hypocrisy and dirtiness.

“Elder Qing hopes our Dapeng Party will have its first councilor under twenty. Of course, this requires your efforts.”

Lu Ming smiled and asked, “Where is the 49th district?”

Wei Baozeng took out a map from his briefcase and spread it on the coffee table.

It was a map of the North Gate council districts, divided into fifty-seven districts. Each district would elect one councilor during elections.

Most districts were in the North Gate urban area, with the rural districts starting from the forties.

The map was colorful, with the Dapeng Party and its allies’ territories marked in red, covering eleven districts.

The 49th district was very remote, near the bay, marked in green, with a name, Wang Zili, and “Justice Party” in brackets. The green area covered six or seven villages with a population number “5672” and a percentage “81%”, likely indicating Wang’s support rate or vote percentage in the last election.

Lu Ming focused, realizing these villages were the same fishing towns near the land he bought from Wen Liangyu.

Elder Qing must be well aware of his company’s presence in Wolong Bay.

“If Lawyer Lu is interested in joining our Dapeng Party, I have detailed information on Councilor Wang Zili.” Wei Baozeng patted his briefcase.

Lu Ming smiled. Elder Qing had indeed calculated well. The 49th district’s councilor had an 81% support rate from the opposing Justice Party, making it their stronghold. If the green color represented that party, the district was deep green.

This indicated that Councilor Wang Zili was well-loved in his district.

Encouraging him to run against someone with such a strong base was either a pleasant surprise if he won or no big deal if he lost.

Being an outsider to the district wasn’t an issue.

For federal parliament, councilors must reside in their representing state or provincial district for at least a year to qualify for candidacy.

Similarly, metropolitan council districts have residency requirements.

But for township councilor districts, there’s no such requirement. As long as the district’s voters recognize you, anyone from North Gate can run in any district.

Especially in rural districts, not being a local and lacking clan support makes running for councilor nearly impossible.

Judging by the map, the largest village and central town in the 49th district, called Wangdian, suggested that Councilor Wang Zili was a local.

After a brief contemplation, Lu Ming reached out, “I’d like to see Councilor Wang Zili’s information.”

Wei Baozeng stared at Lu Ming for a few moments, then handed over a file from his briefcase without further comment.

He then extended his hand, “Lawyer Lu, welcome to the Dapeng Party family. Take your time with the information; don’t let it affect your case. The election is still far off. Once you’re free in a few days, I’ll introduce you to our colleagues. Fill out this form for now! I’ll need to take it back immediately.” He took out an application form from his briefcase, along with a pen and a red ink pad for fingerprints.

Lu Ming nodded, glanced at Wei Baozeng, and said, “Director Wei, you’re not in a hurry, are you? I’d like your advice on opening an account later.”

Wei Baozeng was momentarily stunned, then smiled wryly, “Elder Qing mentioned you might come to open an account, but let’s wait. The bank is in some trouble recently.”

“Oh, why?” Lu Ming was slightly taken aback.

After a moment’s hesitation, Wei Baozeng sighed, “Alright, Lawyer Lu, here’s the situation…” He took out a stack of documents from his briefcase, “I’m heading to the Reed Law Firm in the East District for this matter; it’s quite troublesome. Take a look?”

The Reed Law Firm, renowned in the East Sea Region, consists mainly of Western lawyers and is one of the top law firms in the area.

For someone from North Gate to hire the Reed Law Firm for a lawsuit, it must be a significant issue.

As Lu Ming flipped through the documents, he became increasingly surprised.

He hadn’t expected Baoyin Bank to be on the verge of bankruptcy, entangled in a serious lawsuit, and experiencing a bank run, putting it in a precarious situation.

No wonder Wei Baozeng, who was once a handsome middle-aged man, now looked so haggard.

Baoyin Bank is a centuries-old private bank in the East Sea, originating from the Wei family’s money house.

Although the Wei family operated conservatively, never opening branches outside the East Sea, which hindered its growth in the capital market, it still enjoyed an excellent reputation among locals. There’s an old saying in the East Sea: “The greedy entrust their money to crocodiles, while the good hand their wallets to the Wei family.”

This might have been the Wei family’s early promotional strategy, depicting high-interest banks as crocodiles that would eventually devour the “greedy” ones’ money. Many banks offering high interest collapsed during the financial crisis thirty years ago, while the Wei family bank, with its modest interest rates, survived, maintaining a good reputation.

But this strategy is outdated now. The era of rapid capital growth has arrived, and Baoyin Bank’s conservative approach makes it struggle to keep up. Furthermore, it got involved in a troublesome lawsuit.

The trouble began when Wei Baozeng’s father, the old chairman, helped a long-time friend who wanted to acquire a film company. This company had an account with Baoyin Bank. At the friend’s request, the old chairman allowed a bank employee to check the company’s transactions and accounts.

Unexpectedly, this employee, thinking ahead, contacted the film company’s owner, and they conspired to fabricate many transactions.

The old friend bought the company at a high price, suffering heavy losses, while the owner fled overseas.

When the old friend died of illness, his son found out and sued Baoyin Bank, the owner, and the employee.

Since Baoyin Bank violated banking regulations by disclosing customer transaction details, it’s definitely culpable. Although a personal favor was involved, the old chairman and the Wei family were too trusting, lacking written records.

The lawsuit caused significant damage to Baoyin Bank’s reputation, leading to a bank run. Although Baoyin Bank has plenty of assets, they can’t be quickly liquidated to meet the customers’ withdrawal demands.

The old chairman died of a heart attack during this crisis. The CEO, Wei Baozeng, was in despair and had to sell many properties, even considering closing branches.

If Lu Ming opened an account there now, it might close the next day.

In light of Baoyin Bank’s predicament, Reed Law Firm, adhering to a client-first principle, will no longer charge additional legal fees from now on. However, at the end of the lawsuit, if the court rules in favor of our side, 20% of Baoyin Bank’s shares will be transferred to Reed Law Firm to offset the legal fees. If the court rules against our side, Baoyin Bank will need to pay a legal fee of 160,000 yuan. If unable to pay, this amount will become a debt owed to Reed Law Firm.

In other words, if the lawsuit is won, Reed Law Firm will become a shareholder of Baoyin Bank with 20% of the shares. If the lawsuit is lost, given the current situation, Baoyin Bank will likely go bankrupt, making Reed Law Firm one of its creditors.

The agreement, in duplicate, bears the signature and seal of the late Chairman Wei. The section for the signatory of Reed Law Firm as Party A is blank, indicating that Wei Baozeng intended to take it to Reed Law Firm for their signature, which would make it officially effective.

Lu Ming shook his head, realizing that the Wei family had reached a desperate point, agreeing to such an agreement.

Reed Law Firm was even more of a vampire, seizing the opportunity to exploit them. The legal fees were astronomical.

Charging over 30,000 yuan upfront was already excessive, but an additional 160,000 yuan later? It was outrageous.

Of course, the 160,000 yuan in legal fees was also something the Wei family considered in the event of losing the lawsuit. Given the bank’s imminent collapse, the division of assets among creditors wouldn’t concern them much, so they made a high demand without hesitation.

However, if they won the lawsuit and had to transfer 20% of the bank’s shares to Reed Law Firm, this condition was even more stringent. The late Chairman Wei and his successor Wei Baozeng likely had a pessimistic view of the lawsuit. If they could win, even at this painful cost, it would be worth it.

“Lawyer Lu, please don’t laugh at me…” Wei Baozeng sighed deeply, “The lawyers at Reed Law Firm said the chances of winning are slim, but if we do win, having Reed Law Firm as a major shareholder might be beneficial for Baoyin. We need change! Otherwise, we will be eliminated by the times sooner or later.”

“I have always wanted to change, but the resistance is substantial. Yesterday, I thought that if we could miraculously win this lawsuit, even at the cost of losing 20% of the shares, it would be good for Baoyin. My uncles, great-uncles, and great-grandfathers would no longer have the power to dictate my actions, right? As long as Reed supports me…”

As he spoke, Wei Baozeng smiled bitterly and then shook his head: “Lawyer Lu, do you think this lawsuit is a sure loss?”

“Sigh, forget it, I should be going!” Seeing Lu Ming’s silence, Wei Baozeng stood up, feeling he had spoken too much for their shallow acquaintance. However, seeing this young lawyer reading the agreement, he couldn’t control the frustration in his chest. Talking to this relatively unfamiliar young man felt less burdensome than speaking to those around him.

Lu Ming pondered for a moment and suddenly said, “Brother Wei, let me handle this lawsuit for you. I believe there’s at least a 50% chance of winning.”

Wei Baozeng was stunned and looked at Lu Ming in astonishment.

Lu Ming continued, “In this case, the opposing side must be using the ‘snail in the bottle’ principle, right? They claim that Baoyin Bank, or rather your father and the plaintiff, have formed a legal relationship and caused losses to the plaintiff, right?”

Originally, Wei Baozeng intended to refuse. Although he had heard that this young lawyer was quite capable, he was only nineteen years old. How much could he understand?

Elder Qing wanted to support him, viewing him as a promising political figure with plenty of promotional potential, especially with the high-profile case involving the Japanese, which could be exaggerated for publicity. Voters wouldn’t grasp many issues; as long as the propaganda was handled well, they would follow blindly. Youth and strategy could be advantageous, confusing voters with a halo effect.

Especially since Elder Qing was sending him to challenge the Green Party’s stronghold, it posed no risk to their party regardless of the outcome.

But in terms of legal expertise, Reed Law Firm was a heavyweight, and any of their lawyers would likely surpass this young man.

However, hearing Lu Ming’s remark, Wei Baozeng hesitated. The words of refusal stuck in his throat.

While he wasn’t well-versed in law, months of discussions had familiarized him with some legal concepts relevant to his case.

He even knew that the ‘snail in the bottle’ principle was a significant legal doctrine in economic disputes, established over fifty years ago.

It originated from a customer who found a snail in a canned drink served by a coffee shop and sued the shop.

The shop, feeling unjustly blamed since the can was sealed and they couldn’t see inside, sued the manufacturer.

Both the manufacturer and the shop argued that they had no contractual relationship with the customer since he didn’t buy the drink.

Eventually, the court ruled that the manufacturer had a legal relationship with the customer and was liable for compensation.

This led to more transparent drink packaging.

It also established the ‘neighbor principle,’ meaning a legal relationship can exist without a contractual agreement.

In this case, his father was in a similar situation. Even though he was helping a friend, the plaintiff argued that a legal advisory relationship had formed, making his father liable for the losses incurred.

The court largely agreed with this point.

“Yes, the plaintiff’s lawyer said that,” Wei Baozeng said with a wry smile.

Lu Ming nodded: “The neighbor principle is theoretically sound but needs refinement. It requires more test criteria to objectively reflect the facts. I think I have a chance to persuade the judge.”

This case was a complex economic dispute, and both sides opted out of a jury trial, believing it was too difficult to explain the intricate legal concepts to a jury and control their reactions.

Therefore, it was left to the judge to decide.

Even in economic cases, if one party demands a jury trial, the other side’s opposition is futile.

Listening to Lu Ming, Wei Baozeng felt this young lawyer might have a unique perspective on the case.

However, prudence dictated that he couldn’t hand over the case so easily. It would be reckless.

Wanting to refuse, he suddenly remembered something and asked, “Lawyer Lu, don’t you have another case now? Can you manage?”

Lu Ming nodded: “I have two other lawyers at my firm. They can handle most court appearances. I can take half a day off, which is enough. If I can’t persuade the judge in one session, more time won’t help. Who is the presiding judge?”

Wei Baozeng was speechless. This critical matter, and he was offering half a day? He shook his head and said, “It’s Chief Judge Christine of the North Gate Court.”

Lu Ming responded, “Oh, she’s Li Guan’s disciple.” This case was sensitive, involving many depositors and the stability of North Gate’s financial sector, hence the chief judge’s involvement.

Wei Baozeng’s eyes lit up, recalling Lu Ming’s special relationship with Li Guan.

Hesitating for a moment, he asked, “Lawyer Lu, if I were to hypothetically hand you the case, what compensation would you expect?”

Lu Ming thought for a moment, “If we win, I want to purchase 1% of Baoyin Bank’s shares at market value.”

Wei Baozeng was stunned.

Lu Ming continued, “If I lose, I won’t charge any legal fees, and I’ll pay you 50,000 yuan.”

Smiling, he added, “I’ve been looking to enter the financial sector recently. If Brother Wei is willing to sell me a small stake, just 1%, I’d be very grateful.”

Speechless, Wei Baozeng found it absurd that a lawyer would bet on a case, offering compensation if they lost. But Lu Ming’s sincerity was evident.

Thinking it over, he said, “Lawyer Lu, I need to discuss this with my father.” Planning to find an excuse to decline later.

Today, he wouldn’t sign with Reed Law Firm either. The legal community was small, and Lu Ming finding out wouldn’t be good.

Lu Ming nodded: “Of course, I’ll fill out the party application. Also, I’ll write down some thoughts on the banking industry for you.”

Confused, Wei Baozeng nodded gently, finding this young lawyer somewhat eccentric and unpredictable.

Was Elder Qing wrong about him?

People do age after all, he thought, sighing inwardly.