Key takeaways:
- In 2020, the Beijing Fourth Intermediate People’s Court rendered a ruling against recognition and enforcement of the judgment from the Udmurtia Commercial Court of the Russian Federation on the grounds that the party in absentia had not been properly summoned (the case of Chepetsky Mechanical Plant Joint-Stock Company (2020) Jing 04 Xie Wai Ren No. 2).
- To examine whether the Russian Court had properly summoned the Chinese party in absentia, the Beijing Court reviewed the case according to the China-Russia Judicial Assistance Treaty as well as the Hague Service Convention (in particular, its Article 15), and came to a negative conclusion on this issue.
- This case provides rare materials and perspectives for observing how Chinese courts examine the “proper summons" requirement in cases involving the recognition and enforcement of foreign judgments.
In December 2023, China’s Supreme People’s Court (SPC) issued a judicial interpretation on the application of international treaties and international practices as well as 12 typical cases.
As one of the typical cases, the case of Chepetsky Mechanical Plant Joint-Stock Company (2020) Jing 04 Xie Wai Ren No. 2 ((2020)京04协外认2号), hereinafter the “Chepetsky Case”, is the only case involving the recognition and enforcement of a foreign monetary judgment in China.
In the Chepetsky case, the Beijing Fourth Intermediate People’s Court (the “Beijing Court”) conducted a review under the bilateral treaty on judicial assistance and the Hague Service Convention. The Beijing Court rendered a ruling against recognition and enforcement of the judgment from the Udmurtia Commercial Court of the Russian Federation (the “Russian Court”) on the grounds that the party in absentia had not been properly summoned.
1.Case background
Chepetsky filed a lawsuit with the Russian Court over a dispute arising from the performance of a contract with Jingcheng Company, a Chinese corporation.
On 18 Jan. 2017, the Russian Court, pursuant to the Hague Service Convention, requested the Chinese Ministry of Justice to assist in serving the ruling on a preliminary hearing, a copy of the complaint, and a summons for a court session scheduled for 8:00 AM on 10 Mar. 2017 Moscow time, to the registered address of Jingcheng Company.
On 20 Mar. 2017, the Russian Court requested judicial assistance to serve a decision rescheduling the hearing to 12:30 PM on 6 June 2017.
On 15 June 2017, the Russian Court requested judicial assistance to serve a decision rescheduling the hearing to 10:30 AM on 17 Oct. 2017 Moscow time.
On 20 Oct. 2017, the Russian Court issued a civil judgment in the absence of Jingcheng Company. The judgment stated that, despite all the measures taken in accordance with the Hague Service Convention, the Court had not received any proof that Jingcheng Company was served with the notice of the hearing’s time and place. However, in its reservations to the Convention, China stated that according to Art. 15(2) of the Convention, a judgment can be given even if no certificate of service or delivery has been received, provided all conditions outlined in this Article are met. Therefore, the Russian Court deemed that Jingcheng Company had been properly notified of the hearing’s time and place, and rendered the judgment (the “Russian Judgment”).
Chepetsky then applied to the Beijing Court for recognition and enforcement of the Russian Judgment.
2.Court views
The Beijing Court held that this case should be reviewed in accordance with the relevant provisions of the Treaty on Judicial Assistance in Civil and Criminal Matters Between the People’s Republic of China and the Russian Federation (hereinafter the “China-Russia Judicial Assistance Treaty”). Art. 20 of this Treaty stipulates that judgments shall not be recognized or enforced if the party in absentia was not properly summoned according to the law of the contracting party that issued the judgment, or if a party lacking legal capacity in litigation was not properly represented.
Based on the established facts, the intervals between the dates on which the Russian Court issued its three judicial service requests and the corresponding hearing dates were each less than six months. The final hearing was held on 17 Oct. 2017, during which an oral judgment was rendered, and the formal judgment was issued on 20 Oct. 2017.
In the Beijing Court’s view, the above facts indicate that the service by the Russian Court did not comply with Art. 15(2) of the Hague Service Convention. This Article provides that a judgment may be given “even if no certificate of service or delivery has been received,” provided that “a period of time of not less than six months, allowed by the court, has elapsed since the document was sent.” Since the intervals between the service requests and the hearing dates were less than six months, the Russian Court failed to properly summon Jingcheng Company. Consequently, the judgment in this case falls under the provisions of Art. 20(3) of the China-Russia Judicial Assistance Treaty and should not be recognized or enforced.
3.Comments
This case involves the application of both the China-Russia Judicial Assistance Treaty and the Hague Service Convention. Given that the main issue is whether the Russian Court properly summoned the Chinese party in absentia, the Beijing Court interpreted and applied Art. 15 of the Hague Service Convention, coming to a negative conclusion on this issue.
In this sense, this case provides rare materials and perspectives for observing how Chinese courts examine the requirement of “proper summons” in cases involving recognition and enforcement of foreign judgments (REFJ).
3.1 Review Criteria for “Proper Summons”
The priority of international treaties is a fundamental principle of international civil procedure in China (Art. 271, China’s Civil Procedure Law (2023)). For REFJ cases, Chinese courts examine them in accordance with treaties or the principle of reciprocity (Art. 298, CPL (2023)). To date, China has concluded bilateral judicial assistance treaties that include judgment enforcement clauses with 35 countries, including Russia, France and Italy. For judgments from such treaty jurisdictions, the review is based on the bilateral treaties. For judgments from other non-treaty jurisdictions (such as the UK, the US and Singapore), the review is based on the principle of reciprocity and domestic law.
In this case, the Chinese court first applies the bilateral treaty to determine whether there are grounds for non-recognition and non-enforcement of the foreign judgment according to the treaty. Then, as there is no special provision in the bilateral treaty on “summoning on the defendant in absentia”, which is one of the refusal grounds, the Chinese court applied the Hague Service Convention, to which China and Russia are both Contracting States, to check whether the court summons complies with the Hague Service Convention.
Therefore, regarding the review criteria for “proper summons”, this case applied bilateral treaties and the Hague Service Convention. This judicial logic can be extrapolated to apply to other judgments from treaty jurisdictions. Similarly, for judgments from non-treaty jurisdictions, Chinese courts will use domestic law and the Hague Service Convention (where applicable) as the review criteria.
3.2 What is“six months”&“adequate”under Art. 15(2) of Hague Service Convention?
As pointed out in “Practical Handbook on the Operation of the Service Convention (2016)”, while Art. 15 (2) provides for a mechanism designed to protect the legitimate interests of a diligent plaintiff. Under Art. 15(2), a Contracting State is free to declare, as both China and Russian have already done so, that its judges may give judgment if all the following conditions are met:
（1）the document was transmitted by one of the methods provided for in this Convention,
（2）a period of time of not less than six months, considered adequate by the judge in the particular case, has elapsed since the date of the transmission of the document, and
（3）no certificate of any kind has been received, even though every reasonable effort has been made to obtain it through the competent authorities of the State addressed.
In other words, in cases such as this Chepetsky case, where the document was transmitted in accordance with the Convention, but no certificate of service has been received despite all reasonable efforts already having been made, a default judgment may be delivered as long as the last element is satisfied, i.e. “a period of time of not less than six months, considered adequate by the judge in the particular case, has elapsed since the date of the transmission of the document”.
It may seem simple and straightforward to determine whether the requirements of “six months” and “adequate” have been met.
But it isn’t. In fact, the Chepetsky case is a good example to illustrate the complexities and nuances involved.
On the one hand, one could argue that “six months” has already passed, since it is from the date of first service (18 Jan. 2017) to the date of entry of the default judgment (20 Oct. 2017).
In this case, however, the Beijing Court took a different view, as it looked at the period from the date of each service to the designated date of the court hearing, and it turned out that, for each of the three services, such periods lasted only two(2) to four (4) months, so the “six months” requirement is not met.
On the other hand, it could also be argued that the three attempted services can be seen as a whole, thus the absent defendant had already been given enough time, i.e. around nine (9) months from the date of first service to the date of the court hearing.
However, that is also not how the Beijing Court saw the situation. In its view, “the practice of the Russian Court in reserving a short period for the hearing and repeatedly postponing it makes it difficult to ensure that the defendants can fully and effectively exercise their litigation rights.” Therefore, in order to uphold the legitimate rights of the party in absentia, the Beijing Court refused to recognize the Russian judgment.
Contributors: Meng Yu 余萌
