English to Chinese Translation Services to Facilitate Enforcement of U.S. Judgments in China
Legal translation services play an important role in litigation and the enforcement of judgments from foreign countries, as well as in the enforcement of the U.S. judgments abroad. We’ve blogged before about the difficulty in getting Chinese courts to enforce judgments entered by courts in the United States. On June 30th 2017, a Chinese Court recognized and enforced a United States money judgment in what appears to be the first time in history. This was an unprecedented action that has generated a significant amount of excitement in the Chinese and American legal spheres. The case, Liu Li v. Tao Li and Tong Wu, decided by the Intermediate People’s Court of Wuhan City, is discussed below.
In Liu, a commercial dispute arose between a Chinese citizen (the plaintiff) and two Chinese citizen defendants (the defendants), in 2013 after the plaintiff paid $125,000 for shares in a California company pursuant to a Shares Transfer Agreement. Thereafter, the defendants disappeared and the plaintiff received nothing in return. The plaintiff contacted the local police but was unable to recoup the money. The plaintiff then sued the defendants for fraud in the Los Angeles Superior Court. The Defendants ignored the summons and complaint, and, in 2014, the court granted a default judgment against the defendants and in the plaintiff’s favor for the full amount. The court entered an order requiring the defendants to return the $125,000 payment to plaintiff along with pre-judgment interest and court fees for a total judgment of $147,492.
In 2015, the plaintiff asked the Intermediate People’s Court of Wuhan City to recognize and enforce the judgment. The plaintiff argued that the U.S. judgment was final and that the Chinese court had jurisdiction over the defendants because they both lived and had assets in Wuhan city. The plaintiff also argued that the U.S. judgment did not violate any of China’s principles of law, national sovereignty, security, or social public interest.
In response, the defendants argued that the judgment was not enforceable in China and that they did not receive the requisite notice of the legal proceedings in the United States. The Chinese court held that it did have jurisdiction over the dispute because the defendants owned real estate in Wuhan and also lived there. The Chinese court further found that the copy of the U.S. judgment was authentic, and noted that the plaintiff had provided the Chinese court with a copy of the U.S. judgment translated from English to Simplified Chinese. The Chinese court found that reciprocity did exist between the U.S. and China pursuant to a case entitled Hubei Gezhouba Sanlian Industrial Co., Ltd. et. al. v. Robinson Helicopter Co., Inc. where a U.S. court enforced a Chinese judgment. The court also rejected the defendants’ argument that they were not properly served with notice of the lawsuit, finding that the defendants, had in fact been properly served with notice of the lawsuit by publication. Accordingly, the Chinese court issued a ruling in June of 2017 which recognized and enforced the U.S. judgment.
Although this case is seen by many as a major breakthrough and has generated considerable hope that other Chinese courts will similarly begin to recognize and enforce U.S. judgments, there is no way of knowing if this case was just an anomaly or whether it is the beginning of new U.S.-Chinese relations in the legal realm. It is simply too early to discern whether other Chinese courts will similarly recognize U.S. judgments based on reciprocity going forward.
Furthermore, it is important to consider that in Liu, all of the relevant parties were Chinese citizens and the defendants lived, and owned property in the jurisdiction where the U.S. judgment was enforced. It remains to be seen whether a Chinese court would similarly enforce a judgment in favor of United States citizen or company against a Chinese citizen or company. Continued monitoring of cases involving U.S. judgments in Chinese courts will be necessary in order to determine the effect this case may have on similar cases in the future. Businesses owners and their attorneys should still carefully consider how to best draft contracts and other legal agreements involving the People’s Republic of China and Chinese companies.
For assistance translating U.S. documents and court judgments for presentment in a Chinese court (or vice versa), contact All Language Alliance, Inc. Our legal document translation experts have extensive experience translating legal documents into many different languages including Spanish, Arabic, German, Portuguese, French, Simplified Chinese and Traditional Chinese, for all types of legal disputes.