Provisions of the Supreme People's Court on Certain Issues Concerning the Handling of Execution Objection and Reconsideration Cases by People's Courts

Fa Shi [2015] No. 10

May 5, 2015

The Provisions of the Supreme People's Court on Certain Issues Concerning the Handling of Execution Objection and Reconsideration Cases by People's Courts which were adopted at the 1638th meeting of the Judicial Committee of the Supreme People's Court on December 29, 2014 are hereby promulgated and become effective as of May 5, 2015.

Provisions of the Supreme People's Court on Certain Issues Concerning the Handling of Execution Objection and Reconsideration Cases by People's Courts

(Adopted at the 1638th meeting of the Judicial Committee of the Supreme People's Court on December 29, 2014; Fa Shi [2015] No. 10)

In order to standardize the handling of execution objection and reconsideration cases by people's courts, and maintain the legitimate rights and interests of the parties, interested persons and outside parties, these Provisions are formulated according to the Civil Procedure Law and other laws and in light of the actual execution practice of people's courts.

Article 1 Where an opponent raises an execution objection or a reconsideration applicant applies for reconsideration, a written application shall be submitted to the people's court. A written application shall state specific request, fact, reason and other contents of the objection or reconsideration, and be attached with the following materials:
1. the identity certification of the opponent or reconsideration applicant;
2. relevant evidentiary materials; and
3. address for service and contact information.

Article 2 Where an execution objection meets the conditions under Article 225 or 227 of the Civil Procedure Law, the people's court shall initiate a case within three days, and notify the opponent and relevant parties of the same within three day upon such initiation. Where the conditions for acceptance are not met, a ruling on refusing to accept the application shall be rendered; where it is found, after case initiation, that the conditions for acceptance are not met, a ruling on rejecting the application shall be rendered.
Where the application materials for an execution objection are incomplete, the people's court shall inform the opponent, on a one-off basis, of what needs to be supplemented within three days, and shall refuse to accept the application if such supplementation fails to be made within the time limit.
Where the opponent is dissatisfied with the ruling on refusing to accept, or rejecting the application, the opponent may, within ten days after the ruling is served, apply for reconsideration to the people's court at the next higher level. Where the people's court at the next higher level believes, upon examination, that the application meets the conditions for acceptance, it shall rule to cancel the original ruling and order the execution court to initiate a case or to examine the execution objection.

Article 3 Where an execution court neither initiates a case nor renders a ruling on acceptance refusal within three days after receiving an execution objection, or it fails to render an objection ruling within a statutory time limit without any justified reason, the opponent may raise an objection with the people's court at the next higher level. Where the people's court at the next higher level believes, upon examination, that the reason is justified, it shall order the execution court to initiate a case within three days or to render an objection ruling within 15 days.

Article 4 Where, after an execution case is executed by designation, higher-level or mandate, a party or interested person raises an objection to the execution behavior of the original execution court, the people's court that is responsible for the execution of the case when such objection is raised shall examine and handle such objection; where the designated or entrusted people's court is a lower-level people's court of the original execution court, the original execution court shall still examine and handle the objection.
Where, after an execution case is executed by designation, higher-level or mandate, an outside party raises an objection to the subject matter of execution of the original execution court, the provisions of the preceding paragraph apply as the reference.

Article 5 Under any of the following circumstances, any citizen, legal person or other organization other than a party may act as an interested person to raise an objection to an execution behavior:
1. believing that the execution behavior of the people's court is illegal, hindering the queuing of such party for the repayment of seized, detained or frozen creditor's rights;
2. believing that the auction measures of the people's court are illegal, hindering the participation of such party in fair bidding;
3. believing that the measure of auction, sell-off or paying debts in kind of the people's court is illegal, infringing the preemptive right of such party in the subject matter of execution;
4. believing that the matter for which the people's court requires assistance in execution exceeds the assistance scope of such party or violates the laws; and
5. believing that other legitimate rights and interests are infringed by the illegal execution behavior of the people's court.

Article 6 Where a party or interested person raises an objection according to Article 225 of the Civil Procedure Law, such party or person shall raise the objection before the termination of the execution procedure, except where such party or person raises an objection to the measure of terminating the execution.
Where an outside party raises an objection according to Article 227 of the Civil Procedure Law, such outside party shall raise the objection before the execution of the subject matter of execution as directed in the objection is terminated; where the subject matter of execution is transferred to a party, the outside party shall raise the objection before the termination of the execution procedure.

Article 7 Where a party or interested person raises an objection for believing that the following behaviors in the course of execution or the course of a ruling on execution preservation or preliminary execution are illegal, the people's court shall conduct examination according to Article 225 of the Civil Procedure Law:
1. execution measures such as seizure, detainment, freeze, sell-off, paying debts in kind, suspending execution, discontinuing execution, and terminating execution;
2. statutory procedures that shall be observed during the period, or in the order, of execution; and
3. other behaviors infringing the legitimate rights and interests of the party or interested person which are conducted by the people's court.
Where the person subject to execution raises an execution exclusion objection based on a substantive cause that occurs after execution bases such as extinguishing creditor's rights and losing enforceability become effective, the people's court shall conduct examination by referring to Article 225 of the Civil Procedure Law.
Except for the circumstances specified in Article 19 hereof, where the person subject to execution raises an execution exclusion objection based on a substantive cause that occurs before an execution basis becomes effective, the people's court shall inform such person to legally apply for retrial or settle the case through other procedures.

Article 8 Where an outside party raises an execution exclusion objection to the subject matter of execution based on a substantive right and raises an objection to an execution behavior as an interested person, the people's court shall conduct examination according to Article 227 of the Civil Procedure Law.
Where an outside party not only raises an execution exclusion objection to the subject matter of execution but also raises an objection to an execution behavior irrelevant to the substantive right, the people's court shall conduct examination according to Articles 227 and 225 of the Civil Procedure Law respectively.

Article 9 Where a person who is restricted from leaving China believes that such restriction is an error, such person may apply for reconsideration to the people's court at the next higher level within ten days upon receiving a decision on such restriction. The people's court at the next higher level shall render a decision within 15 days upon receiving the application for reconsideration. During the reconsideration, the execution of the original decision shall not cease.

Article 10 Where a party is dissatisfied with a ruling on rejecting an application for refusal to execute a notarized document on creditor's rights, such party may apply for reconsideration to the people's court at the next higher level within ten days upon receiving the ruling. The people's court at the next higher level shall conduct examination within 30 days upon receiving such application for reconsideration, and shall rule to cancel the original ruling, refusing to execute such notarized document on creditor's rights, if the reason thereof is justified; or shall rule to reject the application for consideration if the reason thereof is unjustified. During the consideration, the execution thereof shall not cease.

Article 11 When examining an execution objection or reconsideration case, the people's court shall legally organize a collegiate panel.
With regard to an execution objection case which is reexamined upon order, a collegiate panel shall be organized separately.
Any personnel handling an execution implementation case shall not participate in the examination of relevant execution objection or reconsideration case.

Article 12 A people's court examines written materials of an execution objection or reconsideration case. With regard to a case with complicated particulars and major dispute, a hearing shall be conducted.

Article 13 During the examination of an execution objection or reconsideration case, if the opponent or reconsideration applicant applies for withdrawing the objection or reconsideration application, whether or not to approve such application shall be ruled by the people's court.

Article 14 Where an opponent or reconsideration applicant, upon lawful summon, refuses to appear in a hearing without any justified reason, or withdraws from a hearing without the permission of the tribunal, so that the people's court fails to ascertain relevant fact, such opponent or applicant shall bear the adverse consequence thereof on its own.

Article 15 Where a party or interested person has several causes for objecting the same execution behavior, but fails to put forward all the causes at once during the objection examination and, after the objection is withdrawn or is rejected upon ruling, raises a new objection to such execution behavior, the people's court shall refuse to accept such objection.
Where, after an outside party withdraws an objection or its objection is rejected upon ruling, such party raises a new objection to the same subject matter of execution, the people's court shall refuse to accept such objection.

Article 16 When rendering a ruling according to Article 225 of the Civil Procedure Law, the people's court shall inform the owners of related rights of the right to apply for reconsideration and the time limit for such application.
When rendering a ruling according to Article 227 of the Civil Procedure Law, the people's court shall inform the owners of related rights of the right to file an action for an execution objection and the time limit for such filing.
Where the laws and judicial interpretations provide for the right of the owners of related rights to apply for reconsideration and the time limit for such application when a people's court renders any other ruling or decision, the information shall be made.

Article 17 A people's court shall handle an objection to an execution behavior according to the following circumstances:
1. if the objection is untenable, a ruling is rendered to reject the objection;
2. if the objection is tenable, a ruling is rendered to cancel relevant execution behavior;
3. if a part of the objection is tenable, a ruling is rendered to change relevant execution behavior; and
4. if the objection is tenable or a part thereof is tenable, but the execution behavior does not involve any cancellation or change, a ruling stating that the objection is tenable or relevant part of the objection is tenable is rendered.

Article 18 Where, in the course of an execution, a third party, after being added as a person subject to execution as a result of voluntarily repaying a debt on behalf of a person subject to execution due to a written commitment, goes back on the commitment without any justified reason and raises an objection, the people's court shall refuse to uphold such objection.

Article 19 Where the parties are in mutual matured debt, and the debts of which the person subject to execution requests the offset meet the following circumstances, except where offset is not allowed according to the law or based on the nature of the debts, the people's court shall uphold such request:
1. being determined by an effective legal document or recognized by the execution applicant; and
2. having the same type and quality as the subject matter of the debts of the person subject to execution.

Article 20 In the execution of monetary claim, if any of the following circumstances is met and the person subject to execution raises an objection on the ground that the subject matter of execution is a residential house that maintains the subsistence of such person and the family dependents thereof, the people's court shall refuse to support such objection:
1. the dependents of the person subject to execution have other residential houses under their name which can maintain their subsistence;
2. after the execution basis becomes effective, the person subject to execution transfers any other houses under the name of such person for evading debts; and
3. the execution applicant provides a house to the person subject to execution and the dependents thereof based on the local low-rent housing area guaranteed, or approves to deduct the rents of five to eight years from the realized price of such house by referring to the average rent standard of the local house rental market.
Where, from the day on which the execution notice is served, a three-month grace period has been granted to the residential house that is delivered to the person subject to execution upon determination in the execution basis, and the person subject to execution raises an objection on the ground that such residential house maintains the subsistence of such person and the dependents thereof, the people's court shall refuse to uphold such objection.

Article 21 Where an objection on requesting the cancellation of auction raised by a party or interested person meets any of the following circumstances, the people's court shall uphold such objection:
1. malicious collusion between bidders or between bidders and the auction agency damages the interest of the parties or other bidders;
2. the buyer does not have the bidding qualification specified in the law;
3. the bidders are illegally restricted from bidding or different bid conditions are set for different bidders;
4. the subject matter of auction fails to be announced according to the laws and judicial interpretations; and
5. other circumstances that seriously violate the auction procedure and damage the interest of the parties or bidders.
Where the party or interested person requests the cancellation of sell-off, the provisions of the preceding paragraph apply as the reference.

Article 22 Where a notarized document on creditor's rights grants enforceability to both principal debt and guarantee debt, the people's court shall approve the execution of such document; where such document grants enforceability to principal debt only without involving guarantee debt, the people's court shall refuse to accept the application for executing the guarantee debt; where such document grants enforceability to guarantee debt only without involving principal debt, the people's court shall refuse to accept the application for executing the principal debt.
Where, after the people's court accepts the application for executing the guarantee debt, the person subject to execution applies for refusal of execution only on the ground that the guarantee contract does not fall within the scope of notarized documents on creditor's rights to which enforceability is granted, the people's court shall refuse to uphold such application.

Article 23 After the people's court at the next higher level examines an application for reconsideration due to dissatisfaction with an objection ruling, the people's court shall handle the application according to the following circumstances:
1. if the objection ruling has clearly ascertained fact, correct application of law and tenable result, a ruling shall be rendered to reject the application for reconsideration and to uphold the objection ruling;
2. if the objection ruling has wrongly ascertained fact or wrong application of law and a result that shall be corrected, a ruling shall be rendered to cancel or change the objection ruling;
3. if the objection ruling has unclearly ascertained basic fact and insufficient evidence, a ruling shall be rendered to cancel the objection ruling and to remand the objection ruling to the people's court rendering the ruling for new examination, or render relevant ruling after the fact is ascertained;
4. if the objection ruling omits an objection request or is under other circumstance of seriously violating the statutory procedure, a ruling shall be rendered to cancel the objection ruling and to remand the objection ruling to the people's court rendering the ruling for new examination; and
5. if the objection ruling wrongly applies Article 225 of the Civil Procedure Law to examine and handle an objection that shall be examined and handled according to Article 227 of the Civil Procedure Law, a ruling shall be rendered to cancel the objection ruling and to remand the objection ruling to the people's court rendering the ruling for new ruling.
Except where the objection ruling is remanded for new examination or new ruling according to Item 3, 4 or 5 of Paragraph 1 hereof, if a ruling is rendered to cancel or change the objection ruling and the execution behavior is revocable or modifiable, the execution behavior upheld by such ruling shall be cancelled or changed at the same time.
Where, after a people's court renders a ruling for a case that is remanded for new examination, a party or interested person applies for reconsideration, the people's court at the next higher level shall, after reconsideration, not remand the case for new examination.

Article 24 With regard to an execution exclusion objection raised by an outside party, the people's court shall examine the following contents:
1. whether or not the outside party is the owner of such right;
2. the legitimacy and authenticity of such right; and
3. whether or not such right can exclude the execution.

Article 25 With regard to an objection of an outside party, the people's court shall judge whether or not such outside party is the owner of a right:
1. registered real estate is judged based on the real estate register; and unregistered buildings, structures and the attached facilities thereto are judged based on the register of land use rights, construction project planning permit, construction permit and relevant evidence;
2. registered motor vehicles, vessels, aircrafts and other specific personal estate are judged based on the registers of relevant departments; and unregistered specific personal estate and other personal estate are judged based on actual possession;
3. bank deposits and negotiable securities deposited in financial institutions are judged based on the account names registered in financial institutions and depository and clearing institutions; and negotiable securities nominally held by depository institutions with lawful operation qualification are judged based on the account name of the actual investors registered in such institutions;
4. equities are judged based on the information publicized in the registration and enterprise credit information publicity system of the administrative departments of industry and commerce; and
5. with regard to other properties and rights, if they are registered, they are judged based on the registration of the registration institutions; if they are not registered, they are judged based on contracts and other evidence showing property ownership or owners of rights.
Where an outside party raises an execution exclusion objection based on the effective legal document of another case, and the owner of the rights in the subject matter of execution recognized by such legal document is inconsistent with the judgment made according to the provisions of the preceding paragraph, Article 26 hereof applies.

Article 26 In the execution of monetary claim, if an outside party raises an execution exclusion objection based on the effective legal document of another case before the subject matter of execution is seized, detained or frozen, the people's court shall handle the objection according to the following circumstances:
1. where such legal document involves an ownership dispute between the outside party and the person subject to execution or a contract dispute for the purpose of not transferring property right such as lease, rent or custody, a decision or ruling that the subject matter of execution belongs to the outside party or that the subject matter of execution is returned to the outside party and that the right of the outside party can exclude the execution is rendered, such objection shall be upheld;
2. where such legal document involves a claim dispute other than a contract dispute specified in the preceding paragraph, and a decision or ruling that the subject matter of execution belongs to the outside party or is delivered or returned to the outside party, such objection shall not be upheld; and
3. where such legal document is a ruling on the success auction or sell-off of the subject matter of execution transferred by the outside party, or a ruling on paying debts in kind, and the right of the outside party can exclude the execution, such objection shall be upheld.
In the execution of monetary claim, if the outside party raises an execution exclusion objection based on the effective legal document of another case after the subject matter of execution is seized, detained or frozen, the people's court shall not uphold such objection.
In the execution of non-monetary claim, if the outside party raises an execution exclusion objection based on the effective legal document of another case, and such legal document has different determination on the ownership of the subject matter of execution, the people's court shall inform the outside party of legally applying for retrial or settling the case through other procedures.
An execution applicant or outside party who is dissatisfied with a ruling that a people's court renders according to Paragraph 1 or 2 hereof may file an action for execution objection according to Article 227 of the Civil Procedure Law.

Article 27 Where an execution applicant legally enjoys the preemptive right in the subject matter of execution against security interest of an outside party, the people's court shall not uphold the execution exclusion objection raised by the outside party, unless otherwise provided for by the laws and judicial interpretations.

Article 28 In the execution of monetary claim, if the buyer raises an objection to the real estate registered under the name of the person subject to execution, and the following circumstances are met and the right of such buyer can exclude the execution, the people's court shall uphold such objection:
1. the written sales contract that is legal and effective has been concluded before the seizure by the people's court;
2. such real estate has been possessed lawfully before the seizure by the people's court;
3. all of the price has been paid, or a part of the price has been paid according to the contract and the remaining is delivered as required by the people's court; and
4. transfer registration fails to be completed due to any reason other than the buyer's own reason.

Article 29 In the execution of monetary claim, if the buyer raises an objection to the commercial residential house under the name of an estate development enterprise subject to execution, and the following circumstances are met and the right of such buyer can exclude the execution, the people's court shall uphold such objection:
1. the written sales contract that is legal and effective has been concluded before the seizure by the people's court;
2. the commercial residential house purchased is used for dwelling and there is no other house for dwelling under the name of such buyer; and
3. the paid price exceeds 50% of the total price stipulated in the contract.

Article 30 In the execution of monetary claim, if the transferee raises an objection on stopping disposal of the seized real estate of which the advance-notice registration for transferred real rights has completed, the people's court shall uphold such objection; if the conditions for real right are met, and the transferee raises an execution exclusion objection, such objection shall be upheld.

Article 31 Where a lessee requests preventing the transfer and possession of the real estate subject to execution to the transferee within the lease term, and has concluded a written lease contract that is lawful and effective and possessed and used such real estate before the seizure by the people's court, the people's court shall uphold such request.
Where the real estate subject to execution is leased at an obviously unreasonable low price, or a proof of rent payment is forged, through malicious collusion between the lessee and the person subject to execution, the people's court shall not uphold their request preventing the transfer and possession of such real estate.

Article 32 With regard to execution objection and reconsideration cases that have not been examined or closed after these Provisions become effective, these Provisions apply. Where a people's court legally institutes the procedure of execution supervision for an execution objection or reconsideration case that has been examined or closed before these Provisions become effective, these Provisions do not apply.