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Sue a Company in China: What Evidence Strategy Should You Adopt in a Chinese Court? - CTD 101 Series

Wed, 05 Jan 2022
Contributors: Meng Yu 余萌
Editor: C. J. Observer

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You should prepare sufficient documentary evidence prior to filing a lawsuit, preferably provided or presented by the other party. In some cases, you can also rely on the court to collect evidence for you.

This post was first published in CJO GLOBAL, which is committed to providing consulting services in China-related cross-border trade risk management and debt collection.

First things first, in determining your evidence strategy in Chinese litigation, you should understand two premises.

i. Chinese judges tend to accept documentary evidence. Electronic evidence and recordings made in public without permission are also acceptable. However, judges are less willing to accept witness testimony.

ii. Instead of the evidence discovery rules in common law, the evidence rules in China are “the burden of proof lies with the party asserting a proposition”. Therefore, you bear the duty to prepare all evidence in support of your claims, and cannot expect the other party to disclose the evidence he/she has collected.

For a more detailed discussion, please read “Suing in China vs Suing in Other Countries: Pros and Cons“.

Based on these two premises, you would be well advised to adopt the following strategy.

1. Prepare all evidence during the performance of the contract

You should keep written documents to prove all the important aspects and details of the performance of the contract.

This is because Chinese judges are more likely to believe documentary evidence rather than witness testimony.

Accordingly, you cannot count too much on, in a later court proceeding, testifying about what happened during the performance of the contract.

You need to prepare sufficient written documents to prove all the facts you wish to present.

However, in many cases, once you have missed a certain opportunity, you will never be able to obtain the written documents.

The tricky part is to convince the counterparty to make statements against itself. For example, you ask a Chinese supplier to admit his/her breach of the contract.

If you later testify to the judge about the supplier’s statements, the judge may not accept it. By contrast, if you can provide the judge with a document from the supplier which shows his/her statements as such, the judge is likely to believe it.

Therefore, after the contract is signed, you’d better keep all written documents to prove every aspect of the performance of the contract.

For more discussions on the role of evidence in China, you can read our previous article “Documentary Evidence – The King of Evidence in Chinese Civil Litigation“.

2. Prepare all the evidence before the other party knows you are suing

First, the written document that you prepare as evidence should preferably be provided by the other party.

If this written document is recorded by you, the other party will probably argue that the document was falsified by you.

In Chinese courts, parties often lie to deny or falsify facts. And the practice is rarely punished under Chinese law.

That’s why Chinese judges are reluctant to believe the testimony and prefer to believe documentary evidence.

Second, if you want to prove a fact in your favor and against the other party with documentary evidence, the evidence admitted by the other party is desirable. A good example of such evidence is a document produced by the other party.

As mentioned in our previous article, in some cases, Chinese judges often lack the necessary flexibility and business knowledge to make a judgment.

Therefore, when the other party denies the evidence, the judge is often unable to make an accurate judgment and likely disbelieves the evidence you present.

However, the other party is usually deemed to admit the evidence produced by himself. And the judge will probably not accept the other party’s denial in court.

For example,

  • A contract or supplemental contract between you and the other party.
  • A letter or email sent to you by the other party.
  • Statements made by the other party in instant messaging tool.
  • Recordings of the other party’s conversations with you.

Of course, if he/she knows you’re going to sue him, he’s likely to be alert.

Consequently, he/she will be very cautious about communicating with you, whether it is in writing, online, or verbally. This will prevent you from gathering the appropriate evidence from him.

Therefore, you should lead the other party to express the key facts in writing before he/she knows you are going to sue. Or you can record his/her oral expression of facts through any means acceptable under Chinese law.

You may refer to our previous articles, Why Chinese Judges Don’t Trust the Witnesses and Parties in Civil Litigation? and Chinese Judges’ Hands Tied on Perjury in Civil Litigation.

3. Suppress the evidence you don’t want to submit

“The burden of proof lies with the party asserting a proposition” also means that one is not obliged to prove a proposition he/she does not assert.

Therefore, you do not need to submit evidence to prove facts that you do not want to assert, like evidence probably involving your trade secrets or resulting in a judgment against you.

However, if the other party knows that you have such evidence or reasonably believes that you should have such evidence, he/she may ask the judge to investigate and collect that evidence from you.

For more information on the burden of proof, you can read the posts Burden of Proof in China, and
Evidence Discovery and Disclosure in China? A Look Into Evidence Presentation Order by Zhang Chenyang(张辰扬) on China Justice Observer.

4. Ask a judge for evidence investigation and collection for you

Yes, Chinese judges can help a party investigate the evidence.

Under Chinese civil procedure, a court shall investigate and collect evidence which a party is unable to collect for some objective reasons and evidence which the court deems necessary for trial.

Therefore, if you have good reason to prove that the other party holds certain evidence, you can apply to the court for evidence investigation and collection from the other party.

If certain evidence is held by a third party, such as a government department, a bank, or an e-commerce website operator, you can also apply to the court to obtain evidence from these entities.

Moreover, according to the law, Chinese courts have the power to investigate and collect evidence from the relevant entities and individuals, and such entities and individuals shall not refuse.

At the same time, it should be noted, however, that Chinese judges are plagued by litigation explosion. As a result, your application for evidence investigation and collection by courts may be often denied for lack of extra energy.

In other words, in terms of evidence investigation and collection, you need to rely on yourself primarily other than on courts.

For more information on evidence collection by courts, you can read the post Evidence Investigation and Collection by Courts by Zhang Chenyang(张辰扬) on China Justice Observer.

 

 

The Cross-border Trade Dispute 101 Series (‘CTD 101 Series’) provides an introduction to China-related cross-border trade dispute, and covers the knowledge essential to cross-border trade dispute resolution and debt collection.

 

 

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Photo by Yannick Pulver on Unsplash

Contributors: Meng Yu 余萌

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