Discussion of the New SPC Guidance and its practical implications
It should be stressed that the issuance of the New SPC Guidance does not mean that the PRC has become a “case law” jurisdiction. As part of the PRC’s judicial reform, the SPC aims to fill the gaps between legislation and judicial interpretations by advocating the practice of following the legal principles derived from prior cases. In this respect, the New SPC Guidance is in accord with, and gives weight to, most of the existing judicial practices of the PRC courts.
(1) Definition of “similar cases” and required circumstances (articles 1 and 2)
The application of case precedents in the civil law jurisdiction is rather limited in scope and carries no direct legal binding force. According to article 1 of the New SPC Guidance, the term “similar cases” refers to those cases which have already been adjudicated and are similar to the pending case in terms of the basic facts, the focus of the dispute, and the application of law.
“Similar cases” may only be referred to in significant, difficult, or complex cases. According to article 2 of the New SPC Guidance, there are four situations in which a search for and/or reference to a similar case is required:
a. When a case is proposed to be submitted to a judges’ meeting or adjudication committee for discussion
b. When the relevant judicial principles or rules are unclear or conflicting
c. When the court president or division head requires such a search under his supervision
d. When another relevant situation requires such a search
(2) Search methods and responsible individuals (articles 3, 5, 6, 7 and 8)
The judge presiding over the pending case is responsible for conducting the search for similar cases and should ensure that such a search is done accurately and properly by using either the SPC’s database or another case database. The New SPC Guidance also recommends several methods for conducting the search, including but not limited to using keywords, legal provisions, or some related cases.
The presiding judge should compare the search results with the pending case so as to identify whether the cases are suitably similar and whether the case precedents have referencing values for the pending case.
To improve the case search system, the New SPC Guidance also requires the presiding judge to (a) discuss particulars of the similar case search and highlight the relevant circumstances in the judges’ meetings or adjudication committee, or (b) prepare a report of the similar case search for future use.
(3) The search range and priority (article 4)
Generally speaking, the similar case search shall be carried out in the following sequence, which shows priority in the application or reference:
a. SPC guiding cases (最高院指导性案例)
b. SPC typical cases (典型案例) and judgments or rulings of the SPC
c. Reference cases issued by the Higher People’s Court and decisions by those courts
d. Higher level courts and judgments of the same level court
Except for SPC guiding cases, the priority should be given to those cases laid down in the preceding three years. If a similar case can be identified using the above order, it is not necessary to carry out further searches.
As there may be a number of similar cases that can be identified in the case search system, the above order and the three-year requirement give more certainty as to which case precedents should take priority. Also, if the parties want to submit one or more similar cases in support of their legal position, it is important to bear in mind the above order of priority.
(4) The legal consequences of similar case searches (articles 9, 10 and 11)
As mentioned above, similar cases will not have any legal binding force under the current PRC law regime. However, given that similar cases will be referred to or considered by judges, such cases may be de facto binding in practice.
a. According to article 9 of the New SPC Guidance, the SPC guiding cases shall be referred to (参照) or followed in the pending case unless such guiding cases conflict with the subsequently enacted law or issued judicial interpretation. Other types of case precedents are not binding and are only relevant for the presiding judge to consider.
b. Article 10 of the New SPC Guidance addresses how the courts should respond to the parties’ submission of similar cases. If the procurators, parties or their representatives submit SPC guiding cases in support of their legal position, the relevant court shall state whether such SPC guiding cases are to be followed in the pending case and give reasons for their applicability. For other types of cases, the relevant court retains the discretion to simply clarify or explain whether such similar cases should be followed.
c. Article 11 deals with situation in which the similar cases identified are inconsistent with the application of law. Such inconsistency is to be resolved by the relevant mechanism provided under the PRC law, in which the relevant court should take into consideration various factors, such as the level of court at which the similar case was judged, the date of judgment, and whether the similar case was discussed by the adjudication committee.
In addition, articles 12 and 13 propose ways to develop the similar case search system in the PRC courts, including better utilization of technology to build up case databases and organizing the case search results on a regular basis for the judges’ reference.
Practicing lawyers should also be duty bound to assist the courts and arbitration tribunals in providing the appropriate cases.
Conclusion
It is good to see that the PRC has been adopting reference to judicial precedents in the process of the PRC’s judicial reform, which will make case results more predictable. There is no doubt that the New SPC Guidance will encourage practitioners to use similar cases and assist judges and arbitration tribunals in making more consistent judgments by referring to case precedents with similar factual matrices and application of law.
Client Alert 2020-467
