Things you must know before filing a lawsuit in China
Author: Lawman Tseng
If you have a disagreement with Chinese or Chinese company which cannot be settled in an amicable way, its obvious that you have to seek legal remedy. However, in practice, when you deal your business in China if you apply the common sense of your own country only instead of learning the basic knowledge of the litigious procedure and Chinese laws, you may lose your case or even the right to pursue.
Here follow the key factors in litigious procedures, any of these factors can cause irreparable damages to your case if you do not take them into consideration.
1. Parties information
The defendant is deemed to provide the information of both parties, including the certificate of identity, residing address, contact person and etc. If one party is a foreign or a company dually registered overseas, certificate of identity as well as the information of the director of such party shall be notarized by a local notary and verified by the Chinese embassy.
If you do not possess the business certificate of your business partner, you have to get a local lawyer to check for it. In many cases, many Chinese will use their English names to sign contracts with you, you MUST ask for their ID card to verify since Chinese do not register their English names and those names are all made up which can be changed from time to time, it takes way more efforts to trace who you are actually dealing with.
The court definitely will not accept a case without authentic and detailed information of parties.
When you sign a contract, especially it’s an international issue and you are in a powerful position, you probably will choose to apply the laws and trial place of your own country. You can probably easily win a case in your own country, however, if the other party refuses to perform the obligations stated in the judgment you have to enforce it. It is unlikely to enforce a foreign entity by the local court, therefore, such judgment shall be recognized in the country where the party resides in. In this case, the court is required to verify two countries whether has a treaty on such issues, whether such judgment is made in due progress and whether enforcing such judgment comprises its own laws, it costs more time and money than just filing a case in China.
China is being a global player now and please be confident in its legal system, it is recommended to choose arbitration court as the last resort for any disagreements, where can be trialed in English or other languages. If it is a litigation case, you need to file the case to a proper court where, mostly, the defendant resides or the contract was dually signed.
Sometimes, you have to define the case before filing in. For example, the defendant’s actions may consist of tort and a breach of contract at the same time, different grounds determines claimable damages and distributions of the burden of proof which can be quite strategic.
The claims need to be specifically listed and supported by facts and laws.
Evidence is for facts and shall be submitted when you are filing the case and within the period said by the court. In China, we apply different evidence rules, in short, a party shall prove what such party says, which compared to the western evidence rules that both parties are obligated to provide evidence. The defendant here is not necessarily required to do so.
Under Chinese laws, the original copy made a huge difference, if you are unable to provide an original copy which normally is stamped, it will comprise itself as evidence unless there is more supporting evidence. You have to clarify how the evidence was produced and what fact was it supporting.
More importantly, any evidence in another language shall be translated into Chinese, if such evidence is originally produced overseas including Hong Kong, Macau, and Taiwan when submitting to the court as evidence, they shall be notarized and verified.
5. Lawyer’s fee
In litigation cases, except SHENZHEN QIANHAI COURT and intellectual property cases, the court will not favor the lawyer’s fee unless it is stated and agreed by parties in the contract. Please be noted to add this in or agree to choose the arbitration court in the contract.