Study On The Recognition And Enforcement Of Foreign Punitive Damages Judgment Under The Hague Judgment Convention

Punitive damages is a civil damages system corresponding to the compensatory damages in the Anglo-American law.It originated in the United Kingdom and has been further developed in the United States,Canada,Australia and other countries.In the field of international civil litigation,the issue of recognition and enforcement of foreign punitive damages judgments has always been the focus of controversy.“Judgment Project” of the Hague Conference on Private International Law conducts an ongoing study of the issue with a view to reaching a recognition and enforcement clause for a punitive damages judgment that can be passed by all countries.“Judgement Project” initially focused on the development of a double convention covering a wide range of content,but in order to develop a consensus-based convention,“Judgement Project” was subsequently narrowed down to focus on international cases involving the choice of court agreement,so it began to develop“Draft on Exclusive Choice of Court Agreements”.The first chapter of this paper mainly studies the relevant content of the recognition and enforcement clause of the punitive damages judgment under theHague Judgment Convention.Both 2003 and 2004 “Draft on Exclusive Choice of Court Agreements” provided for it.However,there were some problems,such as whether the excessive damages should be based on the judgment of the court in the original country and there is no clear definition of the criteria for compensatory damages and etc.The 2005 “Convention on the Choice of Court Agreement” was adopted,which achieves the flexibility of each States as much as possible,on the basis of adhering to the principle of recognition of punitive damages judgments.Due to the diversity of recognition and enforcement of punitive damages in various countries,the same punitive damages judgment produces different recognition and enforcement results in different countries.However,the pursuit of flexibility has also led to ambiguity on some issues: for example,for the definition of punitive damages,the scope of punitive damages,whether litigation costs and lawyers' fees are included in compensatory damages or punitive damages.There is no clear standard or a certain benchmark.In 2016,the Hague Conference on Private International Law established a special commission drafting the “Convention on the Recognition and Enforcement of Judgments in Foreign Courts”.Since 2016,the draft convention has undergone five developments and revisions,namely the “2016 Preliminary Draft Convention”,“February 2017 Draft Convention”,“November 2017 Draft Convention”,“2018 Draft Convention” and the “Draft Convention on the Recognition and Enforcement of Foreign Judgments in Civil or Commercial Matters”,which for the twenty-second diplomatic conference of 2019.The provision of “Convention on the Recognition and Enforcement of Judgments in Foreign Courts” is based on the 2005 “Convention on the Choice of Court Agreements”,based on the premise of the division model and the actual loss as the standard.However,in the negotiation process,some new controversies arises.The second chapter of this paper focuses on two special issues:(1)whether the issue of intellectual property infringement damages is within the scope of punitivedamages;(2)whether the scope of punitive damages should be expanded from the infringement field to the contract area.Regarding the first question,on the Special Commission meeting in June 2016,the controversy over the recognition and enforcement of the punitive damages judgment focused on whether property rights infringement damages is within the scope of the punitive damages judgment.The author chooses the countries which are representative in legal provisions and judicial practice in the Anglo-American legal system and the civil law system,and mainly analyzes the following points: Firstly,whether the country's intellectual property infringement damages is statutory damages or whether it is a statutory duty or obligation,that is,there is no need to prove that the infringement causes damages?If there is the statutory damages in the country,is this kind of statutory damages compensatory of punitive? Secondly,studying the relationship between judicial practice and public policy exceptions on the recognition and enforcement of intellectual property punitive judgments in those countries.Regarding the second question,as far as the scope of application of punitive damages is concerned,countries have inconsistencies according to their historical evolution and national conditions,but the same goes for the difference,all countries are gradually applying the punitive damages from the infringement field to the contract field.The punitive damages in the United States have gradually expanded into medical disputes and product liability cases,while New Zealand,Canada,etc.,with the development of the times,are no longer satisfied with the infringement field,and gradually expand to the contract area.The author selects the United Kingdom,the United States and the EU member states to analyze the scope of application of punitive damages in various countries,especially after the expansion from the infringement to the contract area,which specific contract areas apply punitive damages.The author's research finds that the scope of application of punitive damages judgments in these countries currently extends from the infringement field tothe contractual field,even for civil law countries that have long refused punitive damages.The third chapter of this paper mainly studies the China's legal provisions and judicial practices on punitive damages and the recognition and enforcement of punitive damages judgments.The author believes that the following problems need to be resolved in China: Firstly,there is no definition of punitive damages.Secondly,there is no clear punitive damages.Thirdly,there is no clear scope of punitive damages and which aspects of the contract can be set for punitive damages.Fourthly,there is no punitive damages for intellectual property rights.On September 12,2017,China signed the Convention on the Choice of Court Agreements,but has not formally submitted specific opinions on the Convention.Based on China's position of limited recognition and enforcement of punitive damages judgments,the author believes that some of the reservations should be made to the recognition and enforcement clauses of punitive damages judgments: Under the premise of adopting the division method and the principle of proportionality,the specific definition and scope of application of punitive damages can be clarified,and it is considered that the punitive damages judgment of intellectual property rights should not be recognized and implemented.For the recognition and enforcement of punitive damages judgments,China shall apply the division method according to the principle of the clause,and divide the damages into compensation damages and punitive damages according to the actual loss.Recognition and enforcement of the actual loss range then,while for those damages significantly higher than the actual losses,the higher proportion should be refused recognition and enforcement according to the principle of proportionality.In defining the punitive damages judgment of a foreign court,it is necessary to clarify:first,the purpose of the judgment is to compensate the individual;second,the object of payment of the punitive damage is the victim;third,the punitive damage judgment is passed through the civil lawsuit;fourth,punitive damages are not mandatory fines.Regarding the issue of punitive damages for intellectual property rights,China should have a negative attitude towards the Israeli delegation's views,and the application of public policy exceptions should be used with caution.In addition,since the period of development of China's intellectual property rights is relatively short-lived,first of all,the “equity of fairness” seems to be implemented in mutual recognition and enforcement,but the balance of interest is actually inclined to the developed countries.Since the laws and technologies of developing countries are relatively backward,the “borrowing of intellectual property rights of others”,following the laws of developing countries,may be no infringement problems,but the same situation may result in huge compensation in developed countries.Therefore,it is recommended that the punitive damages judgments for these foreign intellectual property rights should not be recognized and enforcement at present,remaining to gradually establish a punitive damages compensation system for intellectual property rights in China and gradually catch up with international trends.As for the position of the scope of application of punitive damages,although different from the traditional states,where from infringement field to the contract area,the application of punitive damages in China has evolved from the contract field to the infringement field,the punitive damages in the infringement field are relatively perfect compared to the case where the contract area is vague in the early regulations and the punitive damages have not been clarified.Therefore,the author believes that China should clarify the scope of application of punitive damages in the field of contracts.It is possible to increase punitive damages in the field of labor contracts,punitive damages for public service contracts,and punitive damages on the premise of fraud in contracts.