Challenges faced with service of process by post to defendants abroad

In foreign-related civil and commercial actions, the most important task of a court in the face of a defendant located abroad is how to successfully and lawfully serve judicial documents.

The main legal basis for the service abroad of legal documents by a Chinese court are the Hague Convention on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters and the Civil Procedure Law.

Both the former, where the destination country does not raise an objection, and the latter, where the law of the destination country permits the service of process by post, recognise the service of process by post.

In the face of non-compliant service of process by post, the defendant located abroad, unfamiliar with the laws of China, is frequently compelled to hurriedly respond to a suit, foregoing his or her lawful rights.

Service by special delivery

Pursuant to the Several Provisions of the Supreme People’s Court on the Mailing and Service of Litigation Documents by Court Special Delivery, if it would be difficult for a court to directly serve litigation documents, it may consign them to the state postal authority for service by court special delivery, i.e. express mail service.

The author is of the opinion that this does not signify that extraterritorial service of process by post can be done by ordinary letter. The service provisions provide for six circumstances of service of process by post, all of which require the person being served or the person accepting service on their behalf – where the letter carrier provides an acknowledgement of receipt of the item of mail – to at least sign in receipt of the item of mail, before service of process can be deemed to have been made. If a court effects service of process by ordinary letter, the foregoing requirement cannot be satisfied.

‘Deemed service’

If a person being served refuses to sign the service receipt and the acknowledgement of receipt of the item of mail, “deemed service” as provided for in the Civil Procedure Law may apply: if the person being served fails to sign in receipt, but based on the various circumstances it is sufficient to determine that service of process has been made, service of process is deemed to have been made.

It can be seen that the precondition for the application of “deemed service” is that the court is required to provide an acknowledgement of receipt of the item of mail and a service receipt for the person being served to sign, and the service of process by post is required to comply with the requirements of laws, regulations and judicial interpretations. In this regard, article 1 of the Notice of the Supreme People’s Court on Several Issues to Which Attention Is to Be Paid in the Trial and Enforcement of Foreign-Related Civil and Commercial Cases expressly requires that the procedure for the service of legal documents in foreign-related civil and commercial cases must be lawful.

If provisions provide otherwise in respect of the service of process, or the service of process by the court is unlawful, or if the person being served is not at fault in the course of service of litigation documents – see article 11 of the service provisions – the provision on deemed service should not be cited in determining whether service has been completed.

The dilemma

When applying deemed service, if requirements in respect of the lawfulness of the service procedure are not made strict, a defendant abroad will be caught in a quandary.

The Several Provisions of the Supreme People’s Court on the Issue of the Service of Judicial Documents in Foreign-Related Civil and Commercial Cases also contain a provision similar to “deemed service”: if the person being served fails to sign in receipt, but mentions to the people’s court in writing the contents of the served judicial document, has performed in accordance with the content of the served judicial document, etc., process shall be deemed to have been served.

Where a court is in doubt as to whether the service of process was lawful, it can simply cite the foregoing provision.

If defendants raise doubts, this shows that they have received the judicial document; if they do not raise doubts and respond to the suit, this signifies that they have foregone their process rights; or if defendantd ignore the matter, the court may, based on the information at its disposal, deem service to have been completed or continue to carry out constructive service.

That means the defendant located abroad may face the adverse situation of a default judgment.

Additionally, certain courts are heavily influenced by the idea that “substance is more important than procedure”, and are not used to the weight that foreign parties attach to legitimate procedures, and deem that a foreign party that engages a lawyer to raise a claim for lawfulness of a procedure is just nitpicking.

The current situation, where the defendant dare not raise doubts and the court need not make things right, has greatly decreased the difficulty of extraterritorial service of process, but in the long run it brings “after effects”. In future, the lawfulness and enforceability of judgments will certainly be brought into question, and in cases involving extraterritorial enforcement, this kind of effect will be particularly marked.

Consultation on doubts

In short, when a foreign company receives a judicial document from a Chinese court delivered by mail, if it has doubts on the method of service, it may first consult the law of the destination country to see whether it permits service of process by a foreign court on its citizens by post.

Second, in consideration of China’s refusal to accept service of process in China by post when it acceded to the Hague Convention, further consultation regarding judicial practice in the destination country may be carried out to see whether, on the issue of service, there is the possibility of applying the principle of reciprocity.