CHINA Law and Practice Contributed by: Qingyou Wang, Yichen Lu, Chao Tang and Yuhe Gu, Anli Partners
4.2 Early Judgment Applications Chinese civil procedure offers a pathway for the early resolution of claims. Which means if some of the facts are clear, the court can make a ruling on that part first. For example, in a case represented by Anli Partners, the plaintiff sued to confirm the termination of the con- tract and compensate for losses. After ascertaining the facts of the case, the court made an early judg- ment and ruled that the contract was terminated. 4.3 Dispositive Motions Before trial, parties may submit applications that could dispose of the case in whole or in part. Com- mon motions include: • jurisdictional objections; • counterclaims; • requests for case withdrawal; • applications to join necessary third parties; • motions to stay proceedings pending arbitration or related litigation; and • objections to the plaintiff’s standing or capacity. Courts often address these procedural motions early in the case to ensure proper case management and procedural efficiency. 4.4 Requirements for Interested Parties to Join a Lawsuit The legal framework allows third parties whose inter- ests are affected by the lawsuit to participate in the proceedings mainly in the following two circumstanc- es: • independent claims, where a third party asserts rights over the same subject matter; and • interested participation, where the case outcome may affect the third party’s legal interests. A third party who asserts an independent right relat- ed to the dispute may voluntarily apply to intervene. Alternatively, the court may notify a third party, whose interests are not independent but will be affected by the judgment, to join the case.
Collective action for securities law violations repre- sents a major evolution in Chinese group litigation. This model incorporates a special representative action that can function on an opt-out basis for eli- gible investors. In these cases, courts require a pre- cisely defined class of investors harmed by the same alleged misconduct, such as securities fraud or false statements. The system mandates participation by a designated investor protection institution to serve as lead plaintiff. The court’s judgment is binding on all members of the defined group unless they explicitly declare their opt-out. 3.8 Requirements for Cost Estimate Chinese law does not impose a statutory obligation on lawyers to provide clients with a formal cost estimate of the potential litigation at the outset. In practice, most law firms provide clients with an initial estimate outlining potential litigation costs, such as court fees, preservation fees, and appraisal expenses. This estimate is indicative rather than binding. Costs are subject to revision as the case progresses or becomes more complex. Therefore, while not man- dated by statute, providing clients with a cost esti- mate is a recognised professional standard. Parties may file interim applications before or during litigation to protect their rights or secure enforcement of a future judgment. Typical applications include: • property preservation to prevent a party from hid- ing or transferring assets to ensure a future judg- ment can be enforced; • evidence preservation to prevent loss or tampering; and • conduct preservation to compel or restrain specific acts to prevent irreparable harm. These applications may address both procedural and substantive issues. Courts evaluate the necessity, urgency, and proportionality of the measure before issuing an order. 4. Pre-Trial Proceedings 4.1 Interim Applications/Motions
194 CHAMBERS.COM
Powered by FlippingBook