A dissident Chinese poet whose detention has sparked an international appeal for his release has been sentenced to 12 years in prison for contract fraud, his lawyer said.

Li Bifeng – formerly imprisoned for five years for involvement in the Tiananmen Square democracy movement – was sentenced at Shehong county court in Sichuan province, south-west China, Zhao Jianwei said.

He said the defence would appeal, adding: "We believe the verdict was not based on the facts and the prosecutors and the court violated procedural laws and regulations."

A court official who declined to give his name confirmed Li's hearing had taken place, but said he did not have details.

The exiled dissident Liao Yiwu, a friend of Li, said the 48-year-old was targeted because he was suspected of financing Liao's escape from the country last year. Liao said those suspicions were false.

Earlier this year, after Li was detained, Liao launched an international appeal from Germany calling for his release. Among those to have joined the appeal are the Nobel prize-winner for literature Herta Muller and Ha Jin, a winner of the US national book award.

Li's wife said Monday's verdict was untenable. Zhan Xia said the charge related to a sales agreement her husband had signed with an alcohol company to help sell apartments on southern Hainan island.

"After the apartments were sold, the company sued him for contract fraud, which is groundless," she said.

"He is a very good friend of Liao Yiwu, but he didn't tell me whether he helped Liao flee. His being on trial must be related to his alleged help of Liao because the economic charge against him can't be proven," she said.

Zhan said she had only seen her husband once since he was detained in September 2011, and that was at his trial in July.

"He wasn't in good mental health and was suffering from high blood pressure," she said.

A man from Shehong county's prosecutor's office said he knew nothing about the case. Calls to Shehong public security bureau went unanswered.