Taiwan litigation guide
Wellington Koo
Formosa Transnational
Tel: +886 2 2755 7366; Fax: +886 2 2755 6486; Website: www.taiwanlaw.com
Taiwan is a civil law jurisdiction modeled after the legal systems of continental Europe, and particularly Germany. As such, there exist only bench trials and there are no jury trials. Taiwanese courts are divided into three levels: namely the District Courts, which hear cases at first instance; and the High Courts and the Supreme Court, which preside over appeal cases from subordinate courts.
Litigation proceedings
A civil action commences when a plaintiff files a formal complaint with the Court and then the Court issues and serves a writ of summons on the defendant. The plaintiffs are also required to deposit funds as the court fees.
Other then the court fees mentioned above, foreign plaintiffs lacking recognition under Taiwan law may be required to deposit an amount approximately equal to the court fees at the High courts and the Supreme Court. Other remedies:
i. Injunctions
A plaintiff may apply for a provisional injunction prior to receipt of a favourable final judgment, to enjoin a defendant from continuing or commencing certain acts.
ii. Provisional attachment
A plaintiff may petition for a provisional attachment of his opponent’s assets by presenting prima facie evidence illustrating that a risk exists where such assets may be disposed of in an attempt to avoid the consequences of an unfavourable judgment.
iii. Payment orders
A court may issue a payment order in accordance with the creditor’s petition when the subject of the matter is the payment of a specific sum of money or a certain amount of fungible items or valuable securities.
Appeals
Appeals to the High Court on judgments of the District Courts are generally available as of right. Any party may appeal within 20 days after the date when the judgment is served.
For appeals in the High Court, parties may be prohibited by law to present new evidence, arguments or raising new issues.
Appeals to the Supreme Court may only be based on a misapplication of law by a subordinate court. With respect to any property claim, the value must be equal to or exceed the amount of NT$1.5 million (US$46,000) to be eligible for review by the Supreme Court.
Enforcement of foreign judgments and orders
Foreign judgments will not be recognised and enforced in Taiwan if:
(i) the foreign Court rendering the judgment had no jurisdiction over the case according to Taiwan law;
(ii) the foreign judgment was rendered by default and the summons or Court orders necessary for commencement of the action had not been duly served on the defaulting party in that foreign country or through judicial assistance in Taiwan;
(iii) the foreign judgment is deemed inconsistent with Taiwan’s public policy or good morals; or
(iv) judgments rendered in Taiwan are not reciprocally recognised by the subject foreign Courts.
According to Taiwan’s law governing compulsory execution, the party seeking to enforce a final foreign judgment in Taiwan must file a lawsuit in a competent Taiwanese Court for permission to enforce that judgment. The parties may appeal to the Supreme Court in Taiwan just as in other civil cases.
Arbitration
Taiwan law provides that any written documents or communications between parties evidencing a prima facie arbitration agreement shall be deemed as creating an arbitration agreement. Furthermore, in order to ensure the validity of an arbitration clause, the concept of separability has been adopted by Taiwan law.
In principle, Taiwan’s Arbitration Law provides that an award will not be enforced unless a competent court has granted an enforcement order. However, the arbitral award may be enforced without an enforcement order if the parties agree in writing and the arbitral award concerns a payment of a specific sum of money or fungible assets or the delivery of a specific chattel.
Although Taiwan is not a party to the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, the provisions of the Convention are incorporated into Taiwan’s Arbitration Law and a foreign arbitral award is enforceable if its recognition is granted by the court. The foreign countries whose arbitral awards have been recognised by Taiwan courts include the US, the UK and Hong Kong, as well as awards rendered by the International Commerce Committee.
ADR: Mediation
Mediation shall be initiated in any dispute where the value at issue does not exceed NT$100,000 (US$3,000), and in some matters provided under Taiwan’s Civil Procedure Law – such as a dispute regarding property matters, rental issues, traffic accident or malpractice issues, and employment issues.
In addition to the mandatory mediation provisions of Taiwan’s Civil Procedure Law, mediation proceedings can also be initiated if there is a mediation agreement between both parties. A mediated settlement has the same force as a final court judgment.