China’s Supreme Court made a final judgment applying HCCH 1965 Service Convention to serve a Japanese litigant by post in 2019, under the situation where the government of Japan opposed to postal service but the Japanese litigant agreed to accept it.

I. Overview

On 22 Nov. 2019, the Supreme People’s Court of China (“the SPC”) rendered a final judgment over guarantee liability matters, Tang Yimin v. China Development Bank[1], involving the issue of cross-border service by postal channels to a Japanese under HCCH 1965 Service Convention[2].

In this case, one of the litigants, the Japanese named Toshihide Inoue provided in writing to the SPC his mailing address in Japan and expressly accepted the court to serve him directly by mail. The SPC served the judicial documents to Toshihide Inoue by post even though Japan declared the opposition to Article 10(a) of HCCH 1965 Service Convention that “the freedom to send judicial documents, by postal channels, directly to persons abroad”[3] under the situations where China and Japan are both contracting states of HCCH 1965 Service Convention.

II. Case Brief

On 26 Mar. 2007, China Development Bank (hereinafter referred to as “CDB”) and Xu Hui (hereinafter referred as “Xu”) signed the “Guarantee Contract”. Xu assumed joint and several suretyships for the debts under the “Syndicated Loan Contract” with the amount of US$65 million.

On 23 Dec. 2011, Xu, the Guarantor, deceased. On 10 May 2017, Tianjin No. 2 Intermediate People’s Court made a final judgment[4] that Tang Yimin inherited 50% of Xu’s estate and Inoue Toshihide inherited 9% (other heirs not related to this article will not be described here).

On 24 Dec. 2018, Tianjin Higher People’s Court rendered the first-instance judgment. In this case, CDB sued Tang Yimin, Inoue Toshihide and other heirs of Xu to assume joint and several guarantee liabilities within the inheritance, the first-instance court supported the plaintiff’s claims.[5] Tang Yimin appealed to the SPC. In the second-instance trial, the SPC served judicial documents to one of the appellees, Inoue Toshihide, in the postal method. Finally, the SPC dismissed the appeal and upheld the first instance judgment.

III. The SPC’s Decision and Opinions

Regarding the service to the Japanese citizen Inoue Toshihide in the second instance of this case, the SPC ascertained that Japan is a contracting state of HCCH 1965 Service Convention, and gave notice of its declaration of opposition to Article 10(a) that “the freedom to send judicial documents, by postal channels, directly to persons abroad” on 21 December 2018. However, in this case, Toshihide Inoue provided the SPC with his mailing address in Japan, and expressly accepted the SPC to serve him by mail. After receiving the judicial documents from the SPC, Toshihide Inoue signed those documents and sent the corresponding certificate of service back to the SPC.

The SPC held that in terms of civil cases that require cross-border service, if one contracting State to HCCH 1965 Service Convention where the litigant domiciles made oppositions to the postal method of cross-border service, serving judicial documents in a postal manner by the other contracting States to litigants who domicile in the contracting State shall not have the procedural legal binding force. However, the SPC reasoned that HCCH 1965 Service Convention is a convention of private law in nature as its content mainly deals with the service abroad of judicial and extrajudicial documents in civil or commercial matters. In terms of specific cases, if the litigants expressly agree to accept the postal service from the courts of other countries, it shall be construed as a waiver of the party. Respecting the parties’ reasonable choices based on their own places is conducive to the protection of the parties’ litigation interests and the justice of procedure.

Therefore, the waiver that Japanese citizen Toshihide Inoue has made in a private law case involving his own interests is not inconsistent with the Japanese government’s opposition to the way of service by post. Subject to the written consent and the actual acceptance of Inoue Toshihide, the postal service of judicial documents by the SPC complies with due process.

IV. Comments

Article 267 paragraph 1 of Civil Procedure Law (“CPL”) of China stipulates the ways for Chinese courts to serve judicial documents towards parties who do not have a domicile in China, that is, ” in the way specified in the international treaties concluded or acceded to by both the China and the country where the person on whom service is to be made resides”. In the realm of cross-border service, HCCH 1965 Service Convention has a strong influence around the world, both China and Japan are contracting parties to it. In this case, the SPC applied HCCH 1965 Service Convention to serve judicial documents to a Japanese litigant by mail according to the litigant’s clear choice, even if the Japanese government opposed the postal service.

Service abroad is a vital part of international civil procedure. It not only directly relates to whether the transnational litigation in a certain jurisdiction can be carried out in a timely and legal manner, but also relates to whether the procedural rights of the parties are fully protected, and whether the judicial sovereignty of a territory where the party is served is respected as necessary. In this case, the SPC tended to balance the side of judicial efficiency, judicial sovereignty, and the procedural rights of the parties.

 

References:

[1] (2019) Zui Gao Fa Min Zhong No. 395.

[2] Convention on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters concluded on15 November 1965 by Hague Conference on Private International Law (HCCH).

[3] TABLE REFLECTING APPLICABILITY OF ARTICLES 8(2), 10(a)(b) AND (c), 15(2) AND 16(3) OF THE HAGUE SERVICE CONVENTION, see:

https://assets.hcch.net/docs/6365f76b-22b3-4bac-82ea-395bf75b2254.pdf .

[4] (2016) Jin 02 Min Zhong No. 4339.

[5] (2014) Jin Gao Min Er Chu Zi No.0052.