Fully protect lawful rights and interests and standardize the operation of enforcement powers
The Supreme People's Court issued an interpretation on judicial compensation related to enforcement
On 8 February, the Supreme People's Court issued the Interpretation of the Supreme People's Court on Several Issues Concerning the Application of Law in the Trial of Cases Involving Enforcement of Judicial Compensation (Fashi [2022] No. 3, hereinafter referred to as the Interpretation), which came into effect on 1 March 2022. Guided by Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, the Interpretation deeply implements Xi Jinping Thought on the Rule of Law, adheres to the work concept of "when compensation is made, and does good things well", and makes unified norms on a number of issues of legal application in the trial of judicial compensation cases involving enforcement in accordance with the State Compensation Law of the People's Republic of China and other laws and regulations, combined with the actual situation of the people's courts' state compensation trial and enforcement work.
Since the Eighteenth National Congress of the Communist Party of China, under the strong leadership of the Party Central Committee with Comrade Xi Jinping as the core, the people's courts have overcome difficulties, forged ahead, achieved the phased goal of "basically solving the difficulties of enforcement" on schedule, vigorously grasped the construction of the enforcement normative system, effectively restrained and standardized the enforcement power, and achieved major results in enforcement work. At the same time, with the development of state compensation adjudication and enforcement work practice, new situations and new problems in the field of judicial compensation related to enforcement continue to emerge, and the people's new requirements and expectations for the protection of rights have been continuously improved. In order to respond to social concerns in a timely manner, highlight social fairness and justice, and strengthen judicial safeguards for human rights, the Supreme People's Court formulated the Interpretation. The Interpretation consists of 20 articles, the main contents of which include the conditions for filing and reviewing the case involving the enforcement of judicial compensation, the connection between the compensation procedure and the enforcement relief and supervision procedures, the determination of compensation liability, and the scope and standard of damages. Based on the actual situation involving the enforcement of judicial compensation, the "Interpretation" strives to solve the difficulties, pain points and blockages that have long plagued the state compensation trial, and actively responds to the new demands and expectations of the people. The promulgation of the Interpretation will play an important role in the fair and timely trial of judicial compensation cases involving enforcement, fully protect the lawful rights and interests of compensation claimants, and promote the people's courts to carry out enforcement work in a standardized and orderly manner.
According to reports, the Interpretation is jointly drafted and formulated by the Office of the Compensation Commission of the Supreme People's Court and the Executive Bureau on the basis of the 2016 Interpretation of the Supreme People's Court on Several Issues Concerning the Application of Law in the Trial of Judicial Compensation Cases in Civil and Administrative Litigation, summarizing the experience in the practice of judicial compensation and enforcement work involving enforcement. In the next step, the Supreme People's Court will conscientiously study and implement Xi Jinping Thought on the Rule of Law, earnestly grasp the implementation of the Interpretation, and take this as an opportunity to further promote the high-quality development of state compensation trial and enforcement, fully protect the legitimate rights and interests of citizens, legal persons and other organizations, and strive to let the people feel fairness and justice in every judicial case.
The Interpretation of the Supreme People's Court on Several Issues Concerning the Application of Law in the Trial of Cases Involving Enforcement of Judicial Compensation was adopted by the 1857th meeting of the Adjudication Committee of the Supreme People's Court on December 20, 2021, and is hereby promulgated and shall come into force on March 1, 2022.
Supreme People's Court
February 8, 2022
Legal Interpretation [2022] No. 3
Regarding the trial of cases involving enforcement of judicial compensation
Interpretation of certain issues governed by applicable law
(Adopted at the 1857th meeting of the Adjudication Committee of the Supreme People's Court on December 20, 2021, and effective as of March 1, 2022)
This Interpretation is formulated on the basis of the "State Compensation Law of the People's Republic of China" and other laws and regulations, combined with the actual conditions of the people's courts' state compensation adjudication and enforcement work, so as to correctly try cases involving enforcement of judicial compensation and to protect the lawful rights and interests of citizens, legal persons, and other organizations.
Article 1: Where, in the course of enforcing judgments, rulings, and other effective legal documents, people's courts mistakenly employ enforcement measures such as property investigation, control, disposal, delivery, or distribution, or compulsory measures such as fines or detentions, infringing upon the lawful rights and interests of citizens, legal persons, and other organizations and causing harm, and where the victim applies for compensation in accordance with Article 38 of the State Compensation Law, this Interpretation applies.
Article 2: Where citizens, legal persons, and other organizations find that there are applications for compensation for damages caused by the following erroneous enforcement conduct, the people's courts shall accept it in accordance with law:
(1) Enforcement of legal documents that have not yet entered into force, or clearly exceeding the amount and scope specified in effective legal documents;
(2) Where it is discovered that the person subject to enforcement has property available for enforcement, but deliberately delays or fails to enforce enforcement, or should resume enforcement in accordance with law but does not restore it;
(3) Illegally enforcing the assets of an outsider in the case, or illegally delivering the funds and materials for the execution of the case to other parties or outsiders;
(4) Employing enforcement measures against mortgages, pledges, retentions, retention of title, or other such property, failing to lawfully protect the lawful rights and interests of the above-mentioned rights holders such as the right to be reimbursed in priority;
(5) Unlawful enforcement of property that other people's courts have already taken preservation or enforcement measures in accordance with law;
(6) Deliberately failing to perform or neglecting to perform supervision duties on assets sealed, seized, or frozen during enforcement;
(7) Employing enforcement measures against property that is not suitable for long-term preservation or that is prone to depreciation, and failing to promptly dispose of it or handling it in violation of the law;
(8) Illegally auctioning, selling, or redeeming debts in kind, or where it should have been evaluated but not assessed in accordance with law, or where it should have been auctioned but not auctioned in accordance with law;
(9) Illegally revoking an auction, selling, or paying a debt in kind;
(10) Illegally employing measures such as inclusion in the list of judgment defaulters, restrictions on consumption, or restrictions on leaving the country;
(11) Other conduct in which enforcement measures or compulsory measures are taken due to illegal or faulty conduct.
Where the original creditor assigns a claim, its right to apply for state compensation based on the claim is transferred accordingly, except where it cannot be assigned according to the nature of the claim, the agreement of the parties or the provisions of the law.
Article 4: Where people's courts entrust sealing, seizure, freezing, or other such matters to other people's courts for enforcement, and where citizens, legal persons, and other organizations find that the erroneous enforcement act has caused damages and apply for compensation, the court is entrusted to be the organ obligated to make compensation.
Article 5: Citizens, legal persons, and other organizations applying for compensation for erroneous enforcement shall submit it after the enforcement procedures are concluded, and those submitted before the end shall not be accepted. However, except in any of the following circumstances, and it is not possible to remedy in the relevant litigation or enforcement procedures:
(1) Where fines, detention, or other compulsory measures have been revoked in accordance with law, or where personal injury is caused in the course of implementation;
(2) Where the property being enforced is confirmed through litigation procedures not to be the person subject to enforcement in accordance with law, or where the people's court's effective legal documents have confirmed that the enforcement act is illegal;
(3) More than five years have elapsed since the date of filing and enforcement of the case, and a ruling has been made to terminate the current enforcement procedure, and the person subject to enforcement has no property available for enforcement;
(4) Other circumstances in which compensation may be applied for before the end of enforcement procedures.
Where a claimant for compensation applies for compensation after the conclusion of the enforcement procedure in accordance with the provisions of the preceding paragraph, the period of the enforcement procedure shall not be counted in the limitation period for the claim for compensation.
Article 6: Where citizens, legal persons, and other organizations apply for compensation for relevant enforcement measures or compulsory measures during the review of enforcement objections, reconsiderations, or enforcement supervision procedures, the people's courts will not accept them, and those that have already been accepted will be rejected, and they may submit an application for compensation in accordance with law in accordance with the provisions of article 5 of this Interpretation after the conclusion of the above procedures.
Citizens, legal persons, and other organizations that fail to raise objections, apply for reconsideration, or apply for enforcement supervision of relevant enforcement measures or compulsory measures during enforcement procedures does not affect their right to apply for compensation in accordance with law.
Article 7: Where an effective legal document made through enforcement objections, reconsiderations, or enforcement supervision procedures has already been determined as to whether the enforcement act is lawful, the effective legal document may be used as the basis for the people's court compensation committee to determine the legality of the enforcement act.
Where the claimant for compensation makes a contrary claim on the legality of the enforcement act, and provides corresponding evidence to prove it, the compensation committee of the people's court shall conduct a legality review of the enforcement act and make a determination.
Article 8: Enforcement acts made on the basis of the effective basis of enforcement at that time or the basic facts lawfully determined shall not be determined to be erroneously executed because of the following circumstances:
(1) After enforcement or compulsory measures have been adopted, judgments, rulings, or other effective legal documents on the basis of enforcement have been revoked or modified;
(2) The substantive reasons for which the person subject to enforcement is sufficient to resist enforcement occur or have been confirmed in accordance with law after the completion of the enforcement measures;
(3) Where an outsider enjoys substantive rights in respect of the subject matter of enforcement sufficient to preclude enforcement, and is confirmed by legally prescribed procedures after the completion of the enforcement measures;
(4) After the people's court makes a ruling granting enforcement of an administrative act and implements it, the administrative act is lawfully modified, revoked, confirmed to be illegal, or confirmed to be invalid;
(5) After enforcement measures have been taken on the basis of property registration, the registration has been confirmed to be erroneous in accordance with law;
(6) Other circumstances where the basis for enforcement or basic facts subsequently changes.
Article 9: The claimant for compensation shall bear the burden of proof for the damage claimed. However, where the people's court is unable to produce evidence of damages due to faults such as the people's court's failure to make a list or enumerate the details, the people's court shall bear the burden of proof for the above facts.
Where both parties claim that the value of the damage cannot be determined, the party bearing the burden of proof shall apply for an appraisal. Where one party with the burden of proof refuses to apply for an appraisal, it shall bear the adverse legal consequences; where appraisal is impossible, the compensation committee of the people's court shall make a judgment based on the claims of both parties and the evidence in the case, using logical reasoning, daily life experience, and so forth.
Article 10: Where a person subject to enforcement applies for compensation in accordance with the provisions of the first paragraph of Article 5 of this Interpretation due to infringement of his property rights, and his debts have not been paid off, the compensation obtained shall first be used to pay off his debts.
Article 11: Where improper benefits are obtained due to erroneous enforcement and cannot be returned, the people's courts may, after bearing the liability for compensation, recover compensation from the person who has obtained the improper benefits on the basis of a compensation decision.
Where an effective legal document cannot be enforced due to erroneous enforcement, and the applicant for enforcement applies for continued enforcement after obtaining compensation from the State, it will not be supported. After the people's court bears the liability for compensation, it may recover compensation from the person subject to enforcement on the basis of the compensation decision.
Article 12: In the course of enforcement, where the custodian or a third party's conduct infringes upon the lawful rights and interests of citizens, legal persons, or other organizations and causes harm, the custodian or third party shall bear responsibility. However, where the people's court fails to perform its supervisory duties, it shall bear the corresponding compensation liability to the extent that it can prevent or stop the occurrence or expansion of the damage, and may recover compensation from the custodian or a third party on the basis of the compensation decision.
Article 13: In any of the following circumstances, the people's courts do not bear liability for compensation:
(1) The person applying for enforcement provided the wrong property clues;
(2) The enforcement measures are taken or terminated on the basis of a guarantee provided in accordance with law;
(3) People's court staff carrying out personal conduct unrelated to the exercise of authority;
(4) Where an assessment or auction institution commits an illegal act that causes harm;
(5) Causing damage due to force majeure, legitimate defense, or emergency risk avoidance;
(6) Other circumstances where the people's court should not bear liability for compensation in accordance with law.
In the circumstances mentioned in the preceding paragraph, if the people's court has erroneously enforced the act, it shall bear the corresponding liability for compensation according to its role in the process and result of the occurrence of the damage.
Article 14: Where erroneous execution causes actual losses such as interest, rent, etc. to citizens, legal persons, and other organizations, the provisions of item 8 of article 36 of the State Compensation Law shall apply to make compensation.
Article 15: Where the property rights of citizens, legal persons, and other organizations are violated, and the market price at the time of the erroneous execution is insufficient to compensate for the victim's losses, or the price cannot be determined, the losses may be calculated in the following ways:
(1) Calculating property losses and paying interest at the market price at the time of the erroneous enforcement act, and the period for calculating interest is from the date of implementation of the erroneous enforcement act to the date on which the compensation decision is made;
(2) Where the market price at the time of the erroneous enforcement act cannot be determined, or the calculation of the market price at the time of the erroneous execution is manifestly unfair due to factors such as the long time span or large fluctuations in the market price, the market price of the same kind of property may be calculated with reference to the time the compensation decision is made;
(3) Other reasonable methods.
Article 16: Where erroneous execution causes the victim to stop production and business, the following losses are necessary recurrent expenses during the suspension of production and business:
(1) The wages of necessary left-behind workers;
(2) Taxes and social insurance premiums that must be paid;
(3) Water and electricity fees, storage fees, storage fees, and contracting fees that should be paid;
(4) Reasonable rental of housing site, equipment rent, and equipment depreciation;
(5) Other basic expenses required to maintain operations during the period of suspension of production and business.
Where the wrong execution of production equipment or means of transport for operation results in the loss of the victim's sole source of livelihood, compensation shall be made according to his actual loss.
Article 17: Where a claim is infringed by mistake, the scope of compensation shall generally be limited to the amount of the subject matter of the claim. Where the transferee of a claim applies for compensation, the scope of compensation shall be limited to the consideration paid at the time of the assignment of the claim.
Article 18: After cases of illegally adopting preservation measures enter enforcement procedures, citizens, legal persons, and other organizations apply for compensation, they shall be filed and reviewed as cases of erroneous enforcement.
Article 19: This Interpretation may be applied by reference to cases of compulsory measures, preservation, or prior enforcement compensation for unlawful adoption of obstruction proceedings.
Article 20: This Interpretation takes effect on March 1, 2022. Where the judicial interpretation promulgated by this court before its implementation is inconsistent with this interpretation, this interpretation shall prevail.
Source: Judicial Case Research Institute of the Supreme People's Court
Editors: Wang Guanheng, Wang Ning, Chen Qing
Review: Hu Zhiyong Fu Jiacai
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