CROSS BORDER LITIGATION IN TAIWAN
He owes you money but he's in Taiwan. So what are you going to do about it?
The fundamental question that foreign Plaintiffs will always consider would be to file proceedings in their own jurisdiction and seek to apply for the recognition and enforcement of any foreign Judgments in Taiwan against the intended debtor. There are obvious advantages but if you're thinking along this line, think again.
Taiwan does not automatically allow the enforcement of foreign judgments. Foreign Plaintiffs will have to first decide if they can satisfy various elements required under local law concerning an application for recognition. This would include having to prove reciprocity and show proper process service which are two of the most commonly argued issues tendered by challenging defendants. Foreign Plaintiffs will have to also make such an application in open trial. There is no certainty how long this may take to complete. In the case of the M.V. “Playa Blanca” concerning the application for recognition of an English Summary Judgment, the Taiwan courts took more than 10 years to render a final unappealable judgment because of challenges submitted by the local defendant on process service and constant appeals. Therefore in general, it could be better for Plaintiffs to directly sue and commence the main action in Taiwan unless of course there are special circumstances e.g. a foreign law and jurisdiction clause or forum non conveniens.
Taiwan law is Civil Law based on codified statutes and can be historically traced to the German and Japanese systems. In fact, the name of the Taiwan Book on the Six Rudimentary Legislative Statues is exactly as that of Japan’s. There is no doctrine of stares decisis and therefore a higher court cannot generally hope to 100% bind a lower court on legal issues. The Supreme Court publishes a small list of binding cases annually that is intended as precedents but these are very little and rare. The courts here operate on a three-tier system starting from the District Court, the Court of Appeals and the Supreme court. Legal actions are all first filed at the District Court level.
Foreign Plaintiffs are required to submit verified details of the targeted local defendant and pay trial fees of 1.15% of the claim amount to kick start the action at the District Court. Trial fees for appeals at the Court of Appeal and the Supreme Court are usually at 1.5% of the claim amount. Note that the opponents can apply to court to ask for a ruling requiring the Plaintiffs to pay security-for-costs as foreign nationals suing in Taiwan. This would usually cover all trial fees involved for all three-tier court levels and probable legal interests which is at 5%. Local Defendants will employ this as a tactic to create a limited amount of difficulty to the Foreign Plaintiff’s cause in the Taiwan courts.
The main court actions in Taiwan are structured in such way that pre-trial proceedings are extremely short and simplified whereas trial itself does not complete within a single sitting but is broken up into various hearings stretched over various amounts of time to give the Judge ample time to review new arguments and give directions and for parties to make continued submissions. The Taiwan court is inquisitorial as opposed to adversarial. Taiwan Judges perform investigations on evidence and gives directions to parties on what to produce in court. Therefore Depositions and interrogatories do not exist under the Taiwan system.
Intended foreign Plaintiffs should be minded to take consideration before the start of any commitment to initiate proceedings in Taiwan that the local legal system in this country adopts an each-pays-his-own-costs approach with regards to legal expenses incurred (exclusive of the trial fees, mentioned supra). This would mean that a successful Plaintiff whether at the main trial or at any relating ancillary application cannot hope to recover the full or any portion of costs from his opponents regardless of the outcome of the action. Naturally, there is no such application relating to the taxation of costs in the Taiwan system. Plaintiffs would therefore have to factor in the entirety of such costs in their decision making process to see if an action against potential local defendants in Taiwan would indeed be worthwhile.
We hope that you would find this write-up helpful for your needs and can put the information to good use.
IF YOU INTEND TO LITIGATE in Taiwan and wish to seek advise, we would be happy to provide assistance where you can expect our advise to cover all of your concerns coming in as a foreign plaintiff because of our special heritage and training. Please contact the writer for further information.
Writer's information:
DARYL LAI
Email: daryl@jtjb-taipei.com
Telephone: 886-2-27720567