International Construction Law Review
A LIMITED REVIEW OF PUBLISHED CHINESE COURT CASES ON CONSTRUCTION CONTRACTS
RICO CHAN*
Baker & McKenzie
1. INTRODUCTION
The world has witnessed the continuous ascent of Mainland China in global economic significance since the launch of its economic reforms in 1978. Part of this economic development is supported, as well as reflected, in the massive amount of building and infrastructure projects inside China during the last three decades. Apart from the indigenous players, many foreign project owners, contractors, suppliers and consultants also actively participate in this massive construction scene in China.
The author recently conducted a limited survey of published Chinese court cases on construction contracts. This limited survey has two modest purposes in mind. First, it is a useful exercise simply to gather some basic statistics of the published Chinese court cases on construction cases. Secondly, the author would like to see if any relevant legal patterns or themes emerge from these cases.
2. OVERVIEW OF SAMPLING SURVEY OF COURT CASES
2.1 Scope and approach of the survey
This survey of Chinese court cases was done on a sampling rather than a comprehensive basis. The author and his research team conducted the survey based on the following approach and research parameters:
- (a) Primarily, the research team reviewed the court decisions posted on the official web sites of the PRC Supreme People’s Court and the intermediate and higher level courts in three principal regions in China. Specifically, the official web sites of the following courts were reviewed:
- (b) Secondarily, the research team also surveyed the published court cases archived on www.chinalawinfo.com, a well-known electronic legal information database in China to which the author’s work organisation subscribes.
- (c) The research team only reviewed those court cases with title/ headnotes obviously identifying them as “construction contract” disputes. Cases concerning design-only contracts and other construction-related contracts were not reviewed in this survey.
- (d) The research team only surveyed those final court decisions published after 1 October 1999, which was the date on which the PRC Contract Law came into effect. The PRC Contract Law provides a comprehensive legal framework for all types of construction related contracts, as well as all other types of commercial and civil contracts. (The PRC Construction Law actually came into effect on 1 March 1998. The main purpose of the Law is to provide an overall regulatory framework for the Chinese construction industry, rather than a specific legal regime for construction-related contracts in China. The author therefore believes that 1 January 1999, the effective date of the PRC Contract Law, should be a better starting point for this sampling survey.)
2.2 Overview of the 107 cases surveyed
Using the research parameters mentioned in section 2.1 above, the research team collated 107 published court decisions on construction contracts made by the Chinese courts during 1999 to 2011. These 107 cases were geographically located as follows:
- Supreme People’s Court: 9 cases;
- Beijing Municipal People’s Higher Court and Beijing No 1 and No 2 Municipal Intermediate People’s Courts: 38 cases;
- Shanghai Municipal Higher People’s Court: 39 cases;
- Intermediate People’s Courts in four cities in the Guangdong Province: 21 cases.
Save for one case in Beijing, the other 106 cases were all appellate decisions. Specifically, the 107 surveyed cases were decided at the following levels:
- first instance court: 1 case;
- appellate court: 98 cases;
Pt 2] Review of Chinese Cases on Construction Contracts
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