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Copyright 2015 by Stanford University

Guiding Cases AnalyticsTM

指导性案例分析TM

Dr. Mei Gechlik Founder and Director, China Guiding Cases Project

Analytics of 52 Guiding Cases Selected by the Supreme People’s Court of the

People’s Republic of China

Issue No. 4 (May 2015)*

* * *

Table of Contents

I. Background and Significance of Guiding Cases .......................................................... 2

II. Number of Guiding Cases ............................................................................................. 3

III. Types of Guiding Cases ............................................................................................... 4

IV. Sources of Guiding Cases ........................................................................................... 10

V. Facts and Reasons in Guiding Cases .......................................................................... 15

VI. Time Elapsed ............................................................................................................... 17

* The citation of this piece is: Mei Gechlik, Analytics of 52 Guiding Cases Selected by the Supreme People’s

Court of the People's Republic of China, CHINA GUIDING CASES PROJECT, Guiding Cases Analytics™, Issue No. 4,

May 2015, available at http://cgc.law.stanford.edu/guiding-cases-analytics/. The author thanks Jordan Corrente

Beck for editing this piece.

Guiding Cases AnalyticsTM

is a proprietary serial publication of the China Guiding Cases Project that

aggregates important information on all Guiding Cases released to date and performs quantitative analyses to

identify trends and issues worthy of further study.

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I. Background and Significance of Guiding Cases

On November 26, 2010, the Supreme People’s Court of China (“SPC”) issued the

Provisions of the Supreme People’s Court Concerning Work on Case Guidance (the

“Provisions”)1 to establish a system for the selection and re-issuance of certain Chinese court

judgments as Guiding Cases (“GCs”).2 Article 1 of the Provisions provides:

The Supreme People’s Court shall determine and uniformly release as Guiding

Cases those cases that have the effect of guiding adjudication and enforcement

work in courts throughout the country.

Article 2 lists the following requirements:

The Guiding Cases referred to in this set of Provisions mean the rulings and

judgments that have taken legal effect and which are cases that meet the following

conditions:

(i) are of widespread concern in society;

(ii) [involve] legal provisions [that] are of relatively general nature;

(iii) are of a typical nature;

(iv) are difficult, complicated, or of new types; [or]

(v) other cases having a guiding effect.

Though not explicitly binding, GCs are meant to guide the adjudication of subsequent similar

cases. Article 7 of the Provisions states:

People’s Courts at all levels should refer to the Guiding Cases released by the

Supreme People’s Court when adjudicating similar cases.

These measures are, according to the Preamble of the Provisions, carried out to “summarize

adjudication experiences, unify application of law, enhance adjudication quality, and safeguard

judicial justice”.

1 《最高人民法院关于案例指导工作的规定》(Provisions of the Supreme People’s Court Concerning

Work on Case Guidance), Preamble, passed by the Adjudication Committee of the Supreme People’s Court on Nov.

15, 2010, issued on and effective as of Nov. 26, 2010, CHINA GUIDING CASES PROJECT, English Guiding Cases

Rules, June 12, 2015 Edition, available at http://cgc.law.stanford.edu/guiding-cases-rules/20101126-english/. 2 This system has been officially named “案例指导制度” (literally translated as “case guidance

system”). The choice of the term “案例指导制度” could lead to confusion, as it has been used for many years to

refer to any case system that has guiding significance. See 王立峰 (WANG Lifeng), 中国案例指导制度的必要性

和功能 (The Necessity and Function of China’s Guiding Cases System), 中国指导性案例项目 (CHINA GUIDING

CASES PROJECT), Oct. 15, 2013, available at https://cgc.law.stanford.edu/commentary/9-professor-wang. While the

author refrains from calling the system by name in this issue of Guiding Cases AnalyticsTM

, it is worth noting that a

growing body of official documents have used the term to refer to the specific system created under the Provisions.

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The system for the selection of GCs is being developed at a critical time. Most recently,

the SPC has pledged in The Opinion of the Supreme People’s Court Concerning

Comprehensively Deepening the Reform of the People’s CourtThe Fourth Five-Year Reform

Plan of the People’s Court (2014-2018) (the “Fourth Five-Year Court Reform Plan”) to, among

other objectives, “improve the mechanism for unifying the application of law [by] … reforming

and improving the mechanism for selecting, assessing, and releasing Guiding Cases”,

“strengthen the judicial protection mechanism of human rights,” and “establish ‘under sunshine’

a judicial mechanism that is open, dynamic, transparent, and convenient to citizens”.3 These

specific judicial reforms are intended to achieve two goals laid out in the Decision on Major

Issues Concerning Comprehensively Deepening Reforms, adopted at the Third Plenary Session of

the 18th Central Committee of the Communist Party of China on November 12, 2013, namely to:

“ensure independent and impartial exercise, in accordance with law, of adjudication power” and

“promote open trial”. Dubbed the Third Plenum Decision, this document has historical

significance, calling to mind the late 1978 Third Plenum Decision, which announced China’s

open door policy and marked the beginning of the country’s remarkable economic development.

Further, in October 2014, President Xi Jinping and other leaders of China took an

unprecedented step toward greater focus on the rule of law in China during the fourth plenary

session of the Chinese Communist Party’s 18th Central Committee. In the Decision on Several

Major Issues Concerning Comprehensively Moving Forward “Governing the Country According

to Law” (the “Fourth Plenum Decision”), the Central Committee noted some of its primary

goals, including to: “accelerate the construction of a rule of law government”, “guarantee judicial

fairness [and] raise judicial credibility”, and “strengthen and standardize [the systems of] judicial

interpretations and case guidance to unify the applicable standards in law”. The explicit

reference to “case guidance” shows the importance of GCs as perceived by China’s top leaders.

II. Number of Guiding Cases

Since 2011, the SPC has issued ten batches of GCs. The tenth batch was released in April

2015 and consists of eight GCs. The ninth and eighth batches were both released in December

2014, consisting of seven and six GCs, respectively. The average size of earlier releases has

been approximately four GCs per batch (see Chart 1). The growing trend shows the SPC’s

efforts to achieve the goal of strengthening the case guidance system, as stated in the Fourth

Plenum Decision and the Fourth Five-Year Court Reform Plan.

3 《最高人民法院关于全面深化人民法院改革的意见人民法院第四个五年改革纲要（2014-2018）》

(The Opinion of the Supreme People’s Court Concerning Comprehensively Deepening the Reform of the People’s

CourtThe Fourth Five-Year Reform Plan of the People’s Court (2014-2018)), issued by the Supreme People’s

Court on Feb. 4, 2015, available at http://www.court.gov.cn/zixun-xiangqing-13520.html.

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Chart 1: Number of GCs Released per Quarter

III. Types of Guiding Cases

Nine GCs cover criminal law, while six GCs focus on civil procedure law and five on

general principles of the civil law. Administrative litigation law, anti-unfair competition law, and

company law are each covered by four GCs. Other areas of law listed in Chart 2 are covered by

three or fewer GCs. Given that even Zhou Qiang, President of the SPC, admitted in his report to

the National People’s Congress that some courts had delivered verdicts out of accordance with

law and that the credibility of the court system had been undermined,4 the SPC’s release of more

GCs to provide lower level courts with better guidance on the application of criminal rules is

welcome.

4 See, e.g., China’s Chief Justice Warns of Weakness in Court System, CHINA DAILY, available at

http://www.chinadaily.com.cn/china/2014npcandcppcc/2014-03/10/content_17336392.htm.

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Chart 2: Number of GCs by Laws and Regulations Covered

In addition, the SPC seems to have become more interested in releasing the following

types of cases:

• Cases involving intellectual property and unfair competition law

The first GC on intellectual property (specifically patent law) was not released

until 2013 Q4 (Guiding Case No. 20) and the first two GCs on anti-unfair competition

law were not released until 2014 Q2 (Guiding Case Nos. 29 and 30) (see Chart 3).

Related Legal Rules GC No(s). Total # of GCs

Administrative Licensing Law 5 1

Administrative Litigation Law 5, 22, 38, 41 4

Administrative Penalties Law 5, 6 2

Anti-Unfair Competition Law 29, 30, 45, 47 4

Auction Law 35 1

Civil Air Defense Law 21 1

Civil Procedure Law 2, 7, 25, 34, 36, 37 6

Company Law 8, 9, 10, 15 4

Contract Law 1, 33 2

Copyright Law 48 1

Criminal Law 3, 4, 11-14, 27, 28, 32 9

Education Law 38 1

Food Safety Law 23 1

General Principles of the Civil Law 15, 29, 35, 50, 51 5

Insurance Law 25, 52 2

Interim Implementing Measures of the Regulation on Degrees 39 1

Labor Contract Law 18 1

Law on Protection of Consumer Rights and Interests 17 1

Legislation Law 5 1

Maritime Law 16, 31 2

Patent Law 20 1

Regulation on Degrees 38, 39 2

Regulation on Open Government Information 26 1

Regulation on Computer Software Protection 48, 49 2

Regulation on Work-Related Injury Insurances 39 1

Road Traffic Safety Law 19, 24 2

Special Procedure Law on Maritime Litigation 16 1

State Compensation Law 42, 43, 44 3

Succession Law 50 1

Tort Liability Law 19, 24 2

Trademark Law 46 1

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Chart 3: GCs Covering Intellectual Property and Unfair Competition Law

The “Main Points of the Adjudication” sections for Guiding Case Nos. 20, 29, and

30—the text prepared by the Supreme People’s Court to help subsequent courts

understand the GCs and how to “refer to” them—read as follows:

Guiding Case No. 20:

Shenzhen Siruiman Fine Chemicals Co., Ltd. v. Shenzhen Kengzi Water Supply

Co., Ltd. and Shenzhen Kangtailan Water Treatment Equipment Co., Ltd., An Invention Patent Infringement Dispute

Where the Patent Law does not prohibit the manufacture, sale, and importation of

an alleged patent-infringing product within the provisional protection period,

which begins after the invention patent application is published and ends when the

patent is granted, the subsequent use, offer for sale, and sale [of the product] are,

despite the lack of a license from the patentee, not regarded as infringements of

the patent. But the patentee may, in accordance with law, demand that the entity

or individual who exploits the invention within the provisional protection period

pay an appropriate fee.


Tianjin China Youth Travel Service v. Tianjin Guoqing International Travel Agency, A Dispute over an Unauthorized Use of Another Enterprise’s Name

1. An abbreviated enterprise name that has been widely used externally by an

GC

No.

Released

in: Type of Case Related Legal Rules Cited

Final Judgment

Rendered By:

Date of

Judgment

20 2013 Q4 Invention Patent Infringement Patent Law Supreme People’s Court 12/20/2011

29 2014 Q2

Unauthorized Use of Another

Enterprise’s Name Anti-Unfair Competition Law

Higher People’s Court of

Tianjin Municipality 3/20/2012

30 2014 Q2

Trademark Infringement and

Unfair Competition Anti-Unfair Competition Law


Tianjin Municipality 2/19/2013

45 2015 Q2 Unfair Competition Anti-Unfair Competition Law


Shandong Province 3/20/2010

46 2015 Q2

Trademark Infringement and

Unfair Competition Trademark Law


Shandong Province 8/5/2009

47 2015 Q2 Unfair Competition Anti-Unfair Competition Law Supreme People’s Court 3/24/2008

48 2015 Q2

Computer Software Copyright

Infringement

Copyright Law;

Regulation on Computer

Software Protection


Shanghai Municipality 12/13/2006

49 2015 Q2

Computer Software Copyright

Infringement

Regulation on Computer

Software Protection


Jiangsu Province 12/17/2007

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enterprise for a long period of time, that has a certain degree of market

visibility and is known to the relevant public, and that actually already

functions as a trade name, may be regarded as an enterprise name and [thus]

be protected [under law].

2. Where, without authorization, [a business operator] uses another’s abbreviated

enterprise name, which actually already functions as a trade name, as an

Internet bid-for-ranking5 keyword in business activities, causing the relevant

public to be confused and to misidentify [the enterprise], [the unauthorized

use of the abbreviated enterprise name] is an act of unfair competition.


LAN Jianjun and Hangzhou Suremoov Automotive Technology Company Limited v. Tianjin Xiaomuzhi Automobile Maintenance and Repair Services Co., Ltd. et al.,

A Trademark Infringement and Unfair Competition Dispute

1. Whether or not a business operator has [carried out] an act that exceeds [its]

legal business scope and violates administrative licensing laws and regulations

does not affect its exercise, in accordance with law, of [its] civil rights to stop

trademark infringement and unfair competition.

2. The [coverage of] the anti-unfair competition law is not limited to business

operators having direct competitive relationships [amongst themselves] nor

requires them to engage in the same industry. Where the business operators

have indirect competitive relationships and the party [carrying out] the act [in

question] violates the provisions of the anti-unfair competition law and

adversely affects the legal rights and interests of the other business operators,

[the act] should also be determined to be an act of unfair competition.

The SPC’s confidence in providing guidance in intellectual property and unfair

competition through GCs seems to have grown. Five out of the eight GCs released in

2015 Q2 cover these two areas. Of particular note, the SPC went beyond patent law to

release cases that address issues in trademark law, as well as copyright law as applied in

the protection of computer software (see Chart 3). Will a GC covering antimonopoly

law be issued soon? A good candidate is Qihoo v. Tencent (2014), which is the first

Internet-related antimonopoly case handled by the SPC. The court recently ended a

marathon litigation lasting roughly two years when it upheld the Higher People’s Court of

Guangdong Province’s ruling against Qihoo. Qihoo began the legal battle, alleging that

Tencent had abused its position of market dominance by introducing bundle sales to

prevent users from installing Qihoo’s antivirus software. The SPC’s analysis of related

5 Translators’ note: “Internet bid-for-ranking” (“竞价排名”) is a means of bidding for a higher position on an

online search results page. For more information on the topic, see http://baike.baidu.com/view/40571.htm.

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issues such as “relevant market” and “market dominance” will likely have significant

impact on subsequent cases in this area.

• Cases involving foreign parties

The first GC with a foreign party was released in 2014 Q2 (Guiding Case No. 31).

It was a ship collision damages dispute. In 2014 Q4, the SPC released two

GCsGuiding Case Nos. 33 and 37with foreign parties involved, both of which reveal

challenges facing foreign parties after arbitration has concluded.

In Guiding Case No. 33, Cargill International S.A. v. Fujian Jinshi Vegetable Oil

Producing Co., Limited et al., A Dispute over Contracts Affirmed to be Invalid, Cargill

International S.A. (“Cargill”) received an arbitral award against a Chinese corporate

group. According to the award, a member of the Chinese group had to mortgage its

assets to Cargill as security for the repayment of a debt. In the end, however, these assets

were transferred by the debtor to its affiliate companies. Despite the court’s

determination that the related property transfer contracts were invalid, Cargill was not

able to reach the debtor’s assets. The court’s reasons were summarized by the SPC in the

following “Major Points of the Adjudication”:

1. Where a debtor transfers [its] principal property to an affiliate

company at a clearly unreasonably low price and the affiliate company,

with knowledge of the debtor’s indebtedness, does not actually pay

consideration [for the principal property], [a court] may determine that

the debtor and its affiliate company have colluded in bad faith and

have adversely affected the interests of [the debtor’s] creditors. [The

court] should then determine that the related property transfer contract

is invalid.

2. The provision of Article 59 of the Contract Law of the People’s

Republic of China is [also] applicable to situations where a third party

is the owner of the property [covered by that provision]. Where a

creditor enjoys [only] an ordinary claim against a debtor, [a court]

should, in accordance with the provision of Article 58 of the Contract

Law of the People’s Republic of China, order the property obtained

through an invalid contract to be returned to the original owner of the

property. [The court] cannot, based on the provision of Article 59,

directly order that the debtor’s property obtained by the debtor’s

affiliate company through a contract that is the result of “collusion in

bad faith and that adversely affects the interests of a third party” be

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returned6 to a creditor.

In Guiding Case No. 37, Shanghai Jwell Machinery Co., Ltd. and Retech

Aktiengesellschaft, Switzerland, An Enforcement Reconsideration Case on an Arbitral

Award, Shanghai Jwell Machinery Co., Ltd. (上海金纬机械制造有限公司; “Jwell”)

received an arbitral award against Retech Aktiengesellschaft, Switzerland (“Retech”).

Jwell applied to the Lenzburg Court of the Swiss Confederation for the recognition and

enforcement of the arbitral award, but to no avail. Later, Jwell discovered that Retech’s

assets were in Shanghai and immediately applied to a court in Shanghai to “seal up”

Retech’s assets. Retech raised an objection on the ground that Jwell’s application for

enforcement had already exceeded the time limit set forth in the Civil Procedure Law of

the People’s Republic of China. The court disagreed. The SPC summarized the

following principles in the “Major Points of the Adjudication”:

Where a party applies to a court of [the People’s Republic of]

China7 to enforce a foreign-related arbitral award that has come

into legal effect8 and discovers

9 that the party against whom the

enforcement application is filed10

or its property is [located] within

the territory of China,11

the PRC court thereupon has enforcement

jurisdiction over the case. The limitation period for a party to

apply to a [PRC] court for compulsory enforcement should be

calculated from the date on which the party against whom the

enforcement application is filed or its property is discovered to be

[located] within the territory of China.

6 Translators’ note: the term “返还” (“returned”) is used here, but “delivered” might be the term meant;

“returned” suggests that the property was once owned by the creditor. 7 Translators’ note: all subsequent references to “China” or “PRC” refer to “the People’s Republic of China”.

Given the context of this case, any reference to a “PRC court” or “PRC courts” here should be understood to mean

court(s) in mainland China only, excluding courts in Hong Kong and Macau. 8 Translators’ note: the original text reads “发生法律效力的涉外仲裁裁决” (“a foreign-related arbitral

award that has come into legal effect”). According to Article 57 of the Arbitration Law of the People’s Republic of

China, arbitral awards come into legal effect on the date when they are issued. This provision also applies to

foreign-related arbitral awards because: first, Article 65 states that where a matter concerning foreign-related

arbitration is not addressed in Chapter 7 (Specific Provisions on Foreign-related Arbitration) of the Arbitration Law,

other relevant provisions of the law shall apply; and second, Chapter 7 is silent on this issue. See 《中华人民共和

国仲裁法》 (Arbitration Law of the People’s Republic of China), adopted on Aug. 31, 1994, effective as of Sept. 1,

1995, amended on and effective as of Aug. 27, 2009, available at http://www.npc.gov.cn /wxzl/wxzl/2000-

12/05/content_4624.htm and http://www.gov.cn/flfg/2009-08/27/content_1403326.htm. 9 Translators’ note: the sentence structure here and the context of this case suggest that it is the party who

“discovers”, but “it is discovered” is likely the phrase meant. 10

Translators’ note: the term “被申请执行人”, translated here and throughout this Guiding Case as “the party

against whom the enforcement application is filed”, can refer to either an individual or a legal person. 11

Translators’ note: the term “我国领域”, translated here and throughout this Guiding Case as “territory of

China”, has the more precise meaning of the territory of the People’s Republic of China. It is, however, unclear

from the Guiding Case whether the term is meant to refer to the territory of mainland China only.

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In 2015 Q2, the SPC released two more GCs involving foreign partiesGuiding

Case Nos. 47 and 51which involve an unfair competition dispute and a dispute over an

air passenger transportation contract, respectively. Detailed discussion of these two cases

will be provided after the English translations are completed.

IV. Sources of Guiding Cases

Pursuant to Article 3 of the Provisions, the SPC has established a Case Guidance Office

to be in charge of the selection, examination, and submission for approval of GCs. With respect

to the sources of GCs, Article 4 of the Provisions provides:

Any adjudication unit of the Supreme People’s Court may recommend to the Case

Guidance Office any ruling or judgment that is made by the Supreme People’s

Court or local people’s courts at any level and that has taken legal effect, so long

as such ruling or judgment is deemed by the said unit to meet the requirements set

out in Article 2 of this set of Provisions.

Any Higher People’s Court or the Military Court of the People’s Liberation Army

may, following discussion and decision by the adjudication committee of the said

court, recommend to the Case Guidance Office of the Supreme People’s Court

any ruling or judgment that is made by the said court or by a people’s court in its

jurisdiction and that has taken legal effect, so long as such ruling or judgment is

deemed by the said court to meet the requirements set out in Article 2 of this set

of Provisions.

Any Intermediate People’s Court or Basic People’s Court may, following

discussion and decision by the adjudication committee of the said court, report to

the Higher People’s Court level by level and suggest that the Higher People’s

Court recommend to the Case Guidance Office of the Supreme People’s Court

any ruling or judgment that is made by the said court and that has taken legal

effect, so long as such ruling or judgment is deemed by the said court to meet the

requirements set out in Article 2 of this set of Provisions.

Article 5 further provides:

Representatives of people’s congresses, members of committees of the Chinese

people’s political consultative conference, experts and scholars, lawyers, and

other people from all circles of society who care about the adjudication and

enforcement work of people’s courts may recommend any ruling or judgment that

has taken legal effect to the original trial people’s court which rendered such

ruling or judgment, so long as such ruling or judgment is deemed by the said

individual to meet the requirements set out in Article 2 of this set of Provisions.

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Each GC is a summary prepared by the SPC to report the original ruling or judgment

rendered by a court that can be from any level of China’s four-tier system of regular courts or

from China’s special courts. The special courts have jurisdiction to handle military, railroad

transportation, maritime cases, and, pursuant to the recent approval from the Standing

Committee of the National People’s Congress to establish intellectual property courts in Beijing,

Shanghai, and Guangzhou,12

certain intellectual property cases. Of the 52 GCs released to date,

17 are based on rulings/judgments originally rendered by higher people’s courts, 12 by

intermediate people’s courts, 11 by basic people’s courts, 11 by the SPC itself, and one by a

maritime court (Guiding Case No. 31) (see Chart 4).

Chart 4: Number of Rulings/Judgments Rendered by Different Courts Released as GCs

Nine of the 11 GCs whose original rulings/judgments were rendered by the SPC were

released in the latest three batches of GCs (2014 Q4 and 2015 Q2). One of these original

judgments was rendered as early as 2004. As discussed below, the time elapsed between GCs in

earlier batches and the original rulings/judgments were usually two to three years only (see

Chart 5). Three of these nine GCs were enforcement reconsideration cases. The other three

cases were related to state compensation. These cases show the SPC’s keen interest in providing

more guidance on these two topics that have not been clearly understood.

12

《全国人大常委会关于在北京、上海、广州设立知识产权法院的决定》 (Decision of the Standing

Committee of the National People’s Congress on the Establishment of Intellectual Property Courts in Beijing,

Shanghai, and Guangzhou), promulgated and effective as of Aug. 31, 2014, available at

http://npc.people.com.cn/n/2014/0901/c14576-25574846.html.

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Chart 5: Rulings/Judgments Rendered by the SPC Released as GCs

Prior to the release of the full-text of the Fourth Five-Year Court Reform Plan, official

newspapers reported that the SPC had vowed in the plan to “establish a mechanism to convert

the rulings and judgments rendered by the Supreme People’s Court into guiding precedents (指

导性判例)” (emphasis added).13

The use of the term “guiding precedents”, instead of “guiding

cases” (指导性案例), is intriguing because the wordprecedenthas been carefully avoided in

China’s official sources to stop readers from thinking that China might embrace the principle of

stare decisis. If the term “guiding cases” was meant to be used in the phrase quoted above, the

SPC’s selection of many more of its own rulings/judgments is obviously a step to realize this

goal. In the previous issue of Guiding Cases AnalyticsTM

, the author shared the following

observation:

If the use of the term “guiding precedents” was not an oversight, one must wonder

whether “guiding cases” might evolve into “guiding precedents” and whether

“guiding precedents” would have more de facto or de jure “binding” effect than

“guiding cases” do. Even if the SPC issues binding decisions, this would not be a

deviation from the civil law tradition that China has followed. The highest courts

13

LIU Min, 《人民法院第四个五年改革纲要（2014-2018）》发布 (The Release of The Fourth Five-Year

Reform Plan of the People’s Court (2014-2018)), GUANGMING DAILY, July 9, 2014, available at

http://court.gmw.cn/html/article/201407/09/160289.shtml. Guangming Daily is a newspaper of the ruling

communist party.

GC No.

Released

in: Type of Case Related Legal Rules Cited

Date of

Judgment

7 2012 Q2 A Construction Project Contract Dispute Civil Procedure Law 7/6/2011

20 2013 Q4 An Invention Patent Infringement Dispute Patent Law 12/20/2011

33 2014 Q4 A Dispute over Contracts Affirmed to be Invalid Contract Law 8/22/2012

34 2014 Q4 An Enforcement Reconsideration Case Civil Procedure Law 12/11/2012

35 2014 Q4

An Enforcement Reconsideration Case on an

Entrusted Auction

General Principles of the Civil Law;

Auction Law 6/15/2012

36 2014 Q4

An Enforcement Reconsideration Case on a Dispute

over the Rights and Interests in Securities Civil Procedure Law 4/13/2010

42 2014 Q4

A Case of an Application for Compensation for

Unlawful Arrest State Compensation Law 6/18/2012

43 2014 Q4


Erroneous Enforcement State Compensation Law 3/23/2012

44 2014 Q4


Illegal Criminal Recovery State Compensation Law 11/24/2011

47 2015 Q2 An Unfair Competition Dispute Anti-Unfair Competition Law 3/24/2008

52 2015 Q2

A Dispute over a Carriage of Goods by Sea

Insurance Contract Insurance Law 7/13/2004

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in Taiwan and Japan, both of which are civil law jurisdictions, have already issued

binding precedents to help ensure the consistency and certainty of their legal

systems.14

Perhaps the above observation reached relevant authorities in China or perhaps they

themselves noticed the complicated issues arising from the use of the term “guiding precedents”;

it should be noted that the full-text court reform plan released in early 2015 contains no reference

to the establishment of any mechanism to convert the rulings and judgments rendered by the SPC

into “guiding precedents” or “guiding cases”.

Among those rulings/judgments that were not originally rendered by the SPC itself, the

SPC has chosen relatively more from Shanghai (ten GCs) and Jiangsu (eight GCs) for release as

GCs. Other cases are most predominantly from Zhejiang (five GCs), Tianjin, Sichuan,

Shandong, and Beijing (three GCs each) (see Chart 6).

Chart 6: Number of Rulings/Judgments Rendered by the Courts in the Following

Provinces/Provincial-Level Municipalities Released as GCs

Does this distribution show that courts in these places, especially Shanghai and Jiangsu,

display a higher level of competence and thus their rulings/judgments are more likely to be

selected? Chinese courts located in more developed areas can generally offer better recruitment

14

See Mei Gechlik, Guiding Cases Analytics™, CHINA GUIDING CASES PROJECT, Issue No. 3, Jan. 2015,

available at http://cgc.law.stanford.edu/guiding-cases-analytics/ (citing the following pieces to illustrate the use of

precedent-like mechanisms in other civil law jurisdictions: 黄蕙芳 (HUANG Huifang), 台湾刑事案例制度与中华

人民共和国指导性案例制度的发展方向 (Taiwan’s Criminal Case System and the Development Direction of the

Guiding Cases System in the People’s Republic of China), 中国指导性案例项目 (CHINA GUIDING CASES PROJECT),

Aug. 25, 2014, available at https://cgc.law.stanford.edu/commentaries/11-huang-huifang; Toshiaki Iimura, Ryu

Takabayashi, and Christoph Rademacher, Binding Nature of Court Decisions in Japan’s Civil Law System, CHINA

GUIDING CASES PROJECT, June 15, 2015, available at https://cgc.law.stanford.edu/commentaries/13-Iimura-

Takabayashi-Rademacher (forthcoming)).

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packages to attract the best talent in the country and can provide current judges with better

training. Five of the above-mentioned places have high GDP per capita in China (see Chart 7).

Although Shandong’s GDP per capita is only ranked the tenth, the province’s GDP was 5.942

trillion yuan in 2014, making it the third wealthiest province in the country. Though

economically lagging behind these six places, Sichuan is a prosperous province in Western

China. The SPC may have purposefully chosen some cases from Sichuan to diversify its sources

of GCs.

Chart 7: GDP per capita and Number of GCs

Provinces/ Provincial-Level Municipalities GDP per capita (yuan)* Number of GCs

Tianjin 101,699 3

Beijing 94,253 3

Shanghai 90,765 10

Jiangsu 74,699 8

Zhejiang 68,594 5

Inner Mongolia 67,470 1

Liaoning 61,745 0

Guangdong 58,678 1

Fujian 58,058 0

Shandong 56,789 3

Jilin 47,207 0

Chongqing 42,978 0

Shaanxi 42,752 0

Hubei 42,686 1

Ningxia 40,185 0

Hebei 38,832 0

Heilongjiang 38,602 1

Xinjiang 38,110 0

Hunan 36,906 0

Qinghai 36,667 0

Hainan 35,468 0

Shanxi 34,899 0

Henan 34,187 1

Sichuan 32,517 3

Jiangxi 31,836 0

Anhui 31,795 1

Guangxi 30,218 0

Tibet 26,039 0

Yunnan 25,158 0

Gansu 24,438 0

Guizhou 22,982 0

* Source: http://news.xinhuanet.com/finance/2014-03/17/c_119806994.htm

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V. Facts and Reasons in Guiding Cases

The SPC has consistently used the format of dividing each GC into six sections:

(1) “Keywords” (to list keywords that indicate the nature of the dispute etc.);

(2) “Main Points of the Adjudication” (to include general principles prepared by the

SPC that it expects other courts to refer to);

(3) “Related Legal Rule(s)” (to list the legal rule(s) considered in the GC);

(4) “Basic Facts of the Case” (to summarize the most important facts of the GC);

(5) “Results of the Adjudication” (to report the outcomes of legal proceedings); and

(6) “Reasons for the Adjudication” (to summarize the reasons for the final

ruling/judgment).

On average, a GC has about 2,500 Chinese characters, 38% of which are found in the

“Basic Facts of the Case” and another 43% in the “Reasons for the Adjudication”. But a closer

comparison of the ten batches shows that the average length of GCs in the latest batch has clearly

increased to approximately 4,000 Chinese characters per GC (see Chart 8). While there is no

distinctly increasing or decreasing trend in the relative length of the “Basic Facts” section of

issued GCs (see Chart 9), it is clear that the relative length of the “Reasons” sections of issued

GCs has increased to approximately 52% (see Chart 10).

Chart 8: Number of Chinese Characters per GC15

15

In Charts 8-11, the length of the box indicates the range of values between the 25th

and 75th

percentiles for

the batch of GCs illustrated. The black, diamond-shaped marker and the horizontal line inside the box indicate the

mean and median values, respectively. Each red dot represents a GC.

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Chart 9: Relative Length of the “Facts” Section of Each GC

Chart 10: Relative Length of the “Reasons” Section of Each GC

The SPC’s effort to provide more “reasons” is in line with the objective to “push forward

the reasoning reform of adjudication documents” stated in the Fourth Five-Year Court Reform

Plan. One of the areas in China’s court system that most needs improvement is the explanations

for rulings/judgments: courts have generally placed less emphasis on explaining the reasons for

their decisions. More reasons provided in GCs will encourage other courts to follow the SPC’s

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practice. While these improvements are welcome, one must also wonder whether the “Basic

Facts” sections of issued GCs are detailed enough to capture the material facts of the underlying

original judgments. This issue is of particular importance if subsequent courts are not allowed to

refer to the original judgments upon which the GCs are based when these courts decide whether

or not pending cases are similar to any issued GCs.

Guiding Case No. 30, a trademark infringement and unfair competition dispute, is the

longest GC. The original judgment was rendered by the Higher People’s Court of Tianjin

Municipality. The GC has 6,888 Chinese characters. This is one of the first two unfair

competition GCs and is the first GC on trademark infringement. In this case, the “Reasons”

section accounts for 53% of the length of the entire piece, and the “Basic Facts” section accounts

for 33%. Apparently, the significance of the two topics demands a more detailed report of the

case and, in particular, its “Reasons for the Adjudication”.

VI. Time Elapsed

Chart 11: Time Elapsed Between Original Rulings/Judgments and GCs

Most cases selected for release as GCs in earlier batches were about two to three years

old at time of issuance, but recently the SPC chose cases that were, on average, about seven

years old (see Chart 11). The two “oldest” GCs are Guiding Case Nos. 38 and 41 (whose

original judgments were about 16 and 11 years old, respectively, at time of issuance). Guiding

Case No. 38 is a case of a refusal to issue a diploma and a degree certificate, while Guiding Case

No. 41 concerns the revocation of the rights to use state-owned land. The two GCs do not seem

to have anything in common, except that each of them covers amended provisions of the

Administrative Litigation Law of the People’s Republic of China that recently came into effect on

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May 1, 2015.16

Given that these are the first amendments to the law since it was adopted in

1989, numerous training programs and conferences are being held to prepare judges and officials

for the implementation of the amended law. It is, therefore, timely for the SPC to release more

GCs on administrative litigation, allowing interested parties to draw on these sources to illustrate

the application of the Administrative Litigation Law.

The “youngest” GC is Guiding Case No. 24, which features an original judgment that

was only seven months old at time of issuance. Was this case chosen because its “Main Points of

the Adjudication” section is of special importance (see below)?


RONG Baoying v. WANG Yang and Alltrust Insurance Co., Ltd. Jiangyin Branch, A Motor Vehicle Traffic Accident Liability Dispute

[If] a victim of a traffic accident is not at fault, the effect of his [pre-existing]

physical condition on the ramifications of the harm [he suffered] is not a type of

legal circumstance that can mitigate a tortfeasor’s liability.

The answer is affirmative. Research conducted by Stanford Law School’s China Guiding Cases

Project (“CGCP”) team shows that, of the GCs released to date, Guiding Case No. 24 is the most

frequently cited in subsequent cases. As of the publication of this piece, nearly 50 subsequent

cases have referred to this case. The release of this case as a GC shows the SPC’s understanding

of the need to provide guidance in this area. Detailed discussion of the development of Guiding

Case No. 24 and its subsequent cases will be published in the coming months.17

16

《全国人民代表大会常务委员会关于修改⟨中华人民共和国行政诉讼法⟩的决定》(Decision of the

Standing Committee of the National People’s Congress Concerning the Revision of the Administrative Litigation

Law of the People’s Republic of China), adopted on Nov. 1, 2014 and effective as of May 1, 2015, available at

http://www.npc.gov.cn/npc/xinwen/2014-11/02/content_1884662.htm. 17

See Mei Gechlik et al., Guiding Cases Surveys™, CHINA GUIDING CASES PROJECT, Issue No. 2, Aug. 2015

(forthcoming).

guiding cases analytics tm - stanford university

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