WIN & WIN LAW FIRM

Guiding opinions of Supreme People’s Court concerning civil cases involving epidemic

The Supreme People’s court held a news conference in the morning to issue the guiding opinions of the Supreme People’s Court on Several Issues concerning properly hearing civil cases involving epidemic cases (three), and answering questions from reporters on relevant contents.

Question A: the application of international treaties is an important issue in private international law. In the trial of foreign-related commercial and maritime cases, it is very important to accurately understand and apply international treaties, which directly affects the international credibility of judgments. For how to apply international treaties, we need to pay attention to the following issues.
In determining the application of international treaties to cases, we should first distinguish between the matters regulated by treaties and those not regulated by treaties. For the matters not regulated by the treaty, we should determine the applicable law, that is, to determine the applicable law, through the guidance of the conflict norms of our laws.
When applying the treaty, we should also pay attention to the interpretation of the relevant provisions of the treaty. According to Article 31 of the Vienna Convention on the law of treaties, a treaty should be interpreted in good faith according to its terms, its context and the usual meaning of the object and purpose of the Convention.
The formulation of “guidance 3” is problem oriented. We put forward specific opinions on the application of the United Nations Convention on Contracts for the international sale of goods in the most obvious cases of disputes over contracts for the international sale of goods affected by the epidemic situation, and clarified the problems that may be encountered in the trial practice.
First, you can check the status of States parties to the Convention published on the official website of the United Nations Commission on international trade law to determine whether a country is a party to the Convention and whether it has made corresponding reservations.
Secondly, according to Article 4 of the Convention, the Convention does not regulate the validity of the contract and its possible impact on the ownership of the goods sold. For these two kinds of matters, we should determine the applicable law through the guidance of conflict norms in our laws, and make the determination according to the law.
Thirdly, Article 79 of the Convention is about obstacles to performance and corresponding exemption. If a party claims partial or total exemption from contractual liability on the ground that he is affected by the epidemic situation or the epidemic prevention and control measures, the people’s court shall strictly abide by the applicable conditions specified in this article. The articles of the Convention should be interpreted in good faith according to their terms, their context and the common meaning of the object and purpose of the Convention.
Fourth, it should be noted that the digest of case law of the United Nations Convention on Contracts for the international sale of goods is not an integral part of the Convention. It can be used as a reference in the process of hearing cases, but not as a legal basis.

Question 2: in some countries and regions, when the banking business is interrupted due to the epidemic, what impact will this situation have on international trade? What should the people’s court pay attention to in handling such cases?
A: letter of credit and independent letter of guarantee are the most common financial instruments in the field of foreign trade. Due to the impact of the epidemic, banks in some countries will be disrupted, which will affect an important link in international trade and lead to disputes. The international conventions or model clauses related to L / C and independent letter of guarantee stipulate the force majeure. We take UCP600 and urdg758 as examples.
In the letter of credit, Article 36 of UCP600 provides for Force Majeure: “the bank shall not be responsible for the consequences of business interruption caused by acts of God, insurrection, riot, rebellion, war, terrorist act or any strike, shutdown or any other cause beyond its control. When banks resume business, they will no longer undertake or negotiate letters of credit that are overdue during the period of business interruption. ” When applying this provision, we should pay attention to the following issues:
First, we should follow the principle of independent abstractness and strict conformity of L / C, and accurately distinguish between malicious non delivery of goods and non delivery of goods due to epidemic situation. Second, if the parties claim that the bank business is interrupted due to the epidemic situation, they should first determine whether it constitutes force majeure as stipulated in the article. Third, we should also pay attention to whether the parties have a special agreement on force majeure and its liability. For example, the parties agree to exclude the application of UCP600 Article 36. Even if the letter of credit expires during the bank’s business interruption, the bank still has to bear the responsibility of payment.
In the independent guarantee, Article 26 of urdg758 first stipulates that force majeure refers to the business interruption of the guarantor or the counter guarantor in connection with these rules due to acts of God, riots, riots, rebellion, war, terrorist acts or any reason beyond the control of the guarantor or the counter guarantor. On this basis, the article also specifies the provisions that the presentation or payment under the independent guarantee or counter guarantee cannot be performed due to force majeure and the corresponding extension system. In the specific application process, we also need to pay attention to several problems in the letter of credit dispute cases.

Question 3: the epidemic situation has a great impact on the transportation contract. If there is an epidemic during the transportation of goods, does the carrier violate the legal obligation by changing the transportation route? If it causes delay in delivery, can the carrier be exempted from liability?
A: according to our previous investigation, the impact of the epidemic situation on the performance of the transport contract is indeed relatively large. The formulation of guidance 3 is to properly balance the interests of the parties in this case, so as to achieve fairness and justice. According to Article 291 of the contract law, the carrier shall transport the goods to the agreed place by the agreed or usual route.
However, in case of danger in transportation, for the safety of the means of transport, passengers or goods, the carrier may also bypass the usual transportation route. For example, novel coronavirus appear in the conveyance on the way, and need to be diagnosed in time or take quarantine measures. The carrier changes the route of transportation, and sends the patient to the hospital for treatment. As long as the carrier notifies the shipper of this situation in time, the carrier does not violate the obligation stipulated by law, and changing the transportation route is a reasonable detour. While balancing interests, justice also shows the temperature of justice.
In similar cases, if the carrier delays loading and unloading the goods due to the epidemic situation or epidemic prevention and control measures, and fails to deliver the goods to the agreed place at the agreed time, it is in fact a delay in delivery. However, as long as the carrier has timely fulfilled the obligation of notifying the shipper, the carrier can also be exempted from the corresponding liability for delay in delivery.

Question 4: according to previous media reports, some ships are facing anti epidemic measures such as berthing restriction, inspection and isolation, so how should carriers deal with this?
A: the epidemic is a big impact on the shipping industry. In the process of drafting guidance 3, we have fully sorted out the problems that may be encountered by carriers of international carriage of goods by sea. We should not only fully consider the rationality of epidemic prevention measures, but also consider the balance of interests between all parties, and strive to coordinate the needs of epidemic prevention and control and economic and social development. Specifically, carriers carrying goods by sea during the epidemic may encounter these situations:
Before sailing, some ships may not be equipped with necessary crew and materials within a reasonable period due to the epidemic situation or epidemic prevention and control measures; some ships may not be able to reach the loading port and destination port; some ships may not be able to continue normal navigation and berthing once they enter a port affected by the epidemic situation Then, in these cases where the contract cannot be performed due to force majeure or other reasons not attributable to the carrier and the shipper, the carrier may terminate the contract in accordance with Article 90 of the maritime code, and shall not be liable for compensation.
After the ship sails, generally speaking, the carrier shall deliver the goods at the port of discharge agreed in the contract. If the carrier is unable to discharge the goods at the original port of destination due to the epidemic situation or epidemic prevention and control measures, the carrier shall negotiate with the cargo party. If the negotiation fails, the carrier shall have the right to choose a safe port or place near the port of destination to discharge the goods after making proper arrangements for the custody of the goods and fulfilling the obligation of notification, taking full account of the interests of the shipper or the consignee, unless otherwise specified in the contract.
After the ship arrives at the port, in the absence of clear requirements from the port management department, the port operation enterprise shall quickly disinfect and load and unload normally. If a port operating enterprise limits the berthing period of a ship on the ground of quarantine and isolation without authorization, the owner or operator of the ship may request the port operating enterprise to bear the liability for compensation. The people’s court supports this in accordance with the law.

Question 5: China is not only a big shipping country, but also a big trading country. If the cargo side of the international cargo transport contract encounters such problems as the import and export of the prepared goods is prohibited, the land transport is blocked and the shipment cannot be made in time, and the scheduled voyage is changed and cancelled during the epidemic period, how should it deal with them?
A: through investigation, we found that shippers may encounter the following problems during the epidemic period:
First, the shipper may encounter that the goods are temporarily prohibited from import and export by the country or region where the port of loading or the port of destination is located; or the goods cannot be transported to the wharf of the port of loading within a reasonable period due to the obstruction of land transportation; or the contract of carriage cannot be performed due to other reasons that cannot be attributed to the shipper. Under these circumstances, the shipper may terminate the contract of carriage of goods by sea in accordance with Article 90 of the maritime law, and shall not be liable for compensation.
Second, the proportion of container transportation is increasing. The obstruction of land transportation may lead to the problem that the cargo party needs to pay the demurrage fee for the overdue occupation of containers. Due to the nature of progressive superposition, after a long period of time, the accumulated cost often exceeds the value of several containers. At this time, the shipper can negotiate with the carrier to reduce the demurrage charge. If the negotiation fails, the court can be requested to lower the price. Considering that under the background of epidemic situation, the cargo party has a legitimate reason for overstaying the container, it may be unfair to support all the demurrage charges according to the contract, and it does not conform to the provisions of the “contract law” on the predictability standard of loss compensation. The people’s court may reduce the amount according to the actual situation of the case, generally taking the value of a new local container at that time as the upper limit.
Third, the cargo side often encounters the situation that the scheduled voyage is cancelled or the voyage schedule is changed. In this case, if the freight forwarder fails to fulfill its duty of diligence and prudence, fails to notify the shipper of the cancellation of the voyage or the change of the sailing date in time, or fails to cooperate with the shipper in dealing with the relevant follow-up matters, and the shipper requests the freight forwarder to bear the corresponding responsibility, the people’s court shall support it in accordance with the law.

Question 6: China is a big shipbuilding country. Affected by the epidemic situation, the shipbuilding production progress of shipbuilding enterprises is generally delayed. For shipbuilding enterprises, what they are most concerned about is whether they can be exempted from liability?
A: under the shipbuilding contract, the most direct impact of the current epidemic is the delay of shipbuilding due to the failure of shipbuilding enterprises to resume work in time. However, the main international standard shipbuilding contracts, such as the Baltic International Shipping Council standard new shipbuilding contract, Japan shipping exchange new shipbuilding contract, China Shipbuilding Industry and Trade Corporation shipbuilding contract, mostly stipulate the “permissible delay”. According to these standard contracts, the delayed delivery of the ship caused by the epidemic situation or epidemic prevention and control measures should be allowed. If there is no provision in the contract, the people’s court may, in the light of the actual situation of the case, support the party’s application for changing the term of performance of the contract as appropriate.

PREV
NEXT

RELATED POSTS

Leave a Reply

*

*

FOLLOW US

WhatsApp Wechat
Wechat