The Yin And Yang And The Apples And Oranges On Chinese Courts

About a week ago, I did a post touting the fairness of China's courts, entitled, "China's Courts are Fair."  That post was based, in large part, on Professor Tseming Yang's (hence the "Yang" in my title -- groan!) post on his Citizen Yang blog, entitled "Local Governments Lose 30-50% of Administrative Lawsuits," noting "local [Chinese] governments lose an astonishing 30-50% of law suits in China." 

I said I was not astonished by these numbers and I referred back to one of my previous posts, entitled, China Rises -- The TV Show/"Food is Heaven," where I noted the success rate small players had in their lawsuits in Chinese courts against big polluting companies. 

I then went on to qualify my "China's courts are fair" assertion by noting that the Chinese courts virtually never rule against the government when central government policy is at issue and that I am ignoring criminal and political cases.  I also stated that "the chances of getting a fair trial are much greater in prosperous commercial cities like Shanghai, Tianjin, or Qingdao, than they are in a small city in Anhui Province.  I know too that a foreign company prevailing against a powerful local company in a Chinese court is always going to be less likely than if all parties are of the same strata:"   

So China's courts are not always fair. 

But, they are fair way more often than credited by the western media and I am absolutely convinced (as are all of the Chinese lawyers with whom we work) that they are fair often enough to make it as ill-advised to do business in China without written contracts or Intellectual Property (IP) protections as to do business that way in the West. 

Even if China's courts are fair only 60% of the time, this is enough to cause the rational Chinese businessperson to make decisions based on legal ramifications. 

Professor Yang posted a comment to my post (here), disagreeing with my assertions regarding China court fairness.  Before I respond to Professor Yang, however, I would like to thank him and all our readers who comment on our posts, particularly those who disagree with us.  China is a hugely complex place where the only constant seems to be change.  Your comments sharpen our knowledge and make for a more interesting blog and for that, I give you my heartfelt thanks. 

Professor Yang states that the successes achieved by the environmental lawyer on "China Rises" were "unusual" and not due to Chinese courts "working well:"

I met "professor Wang Can-fa, the Beijing environmental lawyer featured in the "China Rises" documentary, last fall.  His success, by his own statements to me, has been unusual.  In that sense, I would not (and I think that he would agree with me) characterize his successes as proof of the courts working well; rather it indicates that it is still possible to prevail against the odds when one has a high-profile Beijing lawyer taking one's case.   

I have never talked to a good litigator who does not ascribe his victory solely to his own brilliance.  I have no doubt Wang Can-fa is a great litigator (I could tell that just by how thoroughly he prepares his cases), but even a great litigator cannot win if the case is fixed.  One simply cannot get away from the fact that Mr. Can-fa's success rate is high enough to prove that, at least in the cases he tries, the fix is not always in. 

Professor Yang then says I am comparing apples to oranges:

The reason why I think you are comparing apples to oranges is that judges act differently depending on the type of case.  When they have commercial disputes involving businesses or, for that matter, lawsuits between private individuals, I would expect them to act quite impartial, save for problems of direct bribes and corruption.  However, whenever one deals with lawsuits against state-owned enterprises or against local and provincial governments themselves, I think that judges act quite differently. 

I agree with Professor Yang that Chinese judges do behave differently depending on the case, but I thought I said that very thing in my post when I distinguished between commercial and criminal cases, between cases in Shanghai and cases in Anhui, between cases involving local companies and those involving foreign companies, and when I placed cases involving Beijing government policy in their own separate sphere. 

Professor Yang then talks about how there is no judicial independence in China:

I am sure that you are aware that under the Chinese governmental system, judges are subordinate to other governmental officials at that level of government.  So local judges are essentially subordinate to the top local official.  There is no judicial independence in China - or at least not as of yet.  (However, there are a number of Chinese constitutional law scholars and judges who advocate judicial independence.)  So the reality is that judicial outcomes are controlled, or at least strongly affected, by the desires of other local government officials. 

Professor Yang's description of China's court system is correct, but I disagree if he is claiming this means China's judges are always beholden to the local government. The lowest Chinese courts are usually controlled by the city (at least with respect to China's bigger cities) in which they are located, with the higher courts usually controlled by the province.  But, to a certain extent, Beijing controls everything.  The government in Beijing directly controls China's attorney generals and one of the jobs of the attorney generals is to make sure judges rule fairly.  If a citizen (or a company) has a complaint about a judge's ruling, he can take it to the local Attorney General and if the Attorney General agrees the ruling was wrong, the Attorney General can take various steps to remedy the situation.  Another Beijing ministry monitors judges for corruption.  So though China's judges are to a great extent controlled by the local governments, Beijing still wields the ultimate authority. 

United States Federal Judges are appointed for life so, to a large extent, they are not controlled by anyone but themselves. This is most emphatically not the case in China.  No judge in China is independent to the extent we think of judicial independence in the West. I once asked a couple of Chinese lawyers what would happen if a local, lower court judge were to issue a case ruling that contradicted a previous Supreme Court ruling.  It took these lawyers about five minutes to get their heads around my question (asked in perfect Chinese by Steve) because, as they eventually told us, this simply has never and would never happen. 

But, this lack of judicial independence does not mean every Chinese judge takes orders on his or her cases directly from the government.  Beijing wants its citizens to resolve disputes in the courts, rather than with violence, protest, or local party hacks.  Beijing therefore wants its citizens to trust the courts.  The Citizens will not trust courts that are inherently biased and corrupt.  Beijing therefore gives give judges pretty free reign to rule on those cases that do not directly impact Beijing government policies and Beijing tries to monitor corruption.   

Professor Yang then states that when a lawsuit is brought against a local government, the fix is in: 

When a lawsuit is filed against the local government, as often occurs with land takings and environmental cases, the dynamics should be easy to figure out.  These dynamics are at the root of current social unrest about land takings in China and the many petitions that are filed in Beijing about local government misdeeds - because the courts do not provide a remedy for such complaints.

The problem with this argument is that it essentially refutes Professor Yang's own post on how plaintiffs win these cases 30 to 50 percent of the time.  But Professor Yang now finds his own numbers suspect:  "I [Professor Yang] have some doubts as to whether they are in fact accurate." 

Professor Yang also ignores that the appeals of these cases are usually before Judges who are not so beholden to the local officials.  For example, if one loses a case at the Qingdao city level, one can appeal it to the appellate court in Jinan, Shandong Province's provincial capital. 

Theory is a Law Professor's stock in trade.  In theory, because China's courts lack judicial independence, they simply cannot be fair.  So if statistics say China's courts are at least somewhat fair, a professor must be astonished.  And if astonishment is not convincing enough, then the statistics themselves must be wrong. 

Businesses have to deal in reality and the reality is that China's courts are fairer than is widely believed in the West. China's courts are certainly fair often enough so those who conduct business in China must do so in a way so that if they end up in court, they can prevail.