Guideline helps courts enforce judgments

The Supreme People's Court has issued another guideline designed to tackle common difficulties faced by court officials when trying to enforce judgments in civil lawsuits - a major problem plaguing the mainland judicial system and weakening judicial authority.

A common complaint about the judicial system is that those who win lawsuits are often unable to recover their money. Losing parties often claim they have no money, and courts used to say there was nothing they could do about it.

Under the guideline, issued at the weekend, courts now have two extra tools they can use to investigate the financial situation of the losing party in a lawsuit.

They can order a professional accounting assessment of the losing party and related companies, and they can offer a monetary reward - to be paid by the winning party - for information from the public regarding the losing party's financial situation.

There are many legally grey methods that a losing party can use to hide or protect their assets and appear broke. An individual might initiate a divorce, transfer all his money to a trusted third party, or ask a friend to bring a fake lawsuit against him for the same sum of money. A company could claim bankruptcy, initiate corporate restructuring, or fake the existence of prior debts.

The courts' limited powers to investigate the finances of a losing party and enforce judgments are two other major reasons for weak enforcement.

About 15 per cent of each court's staff is dedicated to enforcement of judgments. But enforcement takes time, often requires actions outside the local jurisdiction and is dependent on co-operation from other government units, such as financial and real estate regulators, traffic departments and commerce bureaus.