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2016 Maritime Trial Report of Zhejiang

Ningbo Maritime Court
March 2017
 

Foreword

    China's foreign trade development faced unprecedented pressure in 2016. In the first three quarters, China's exports to Pakistan, Russian and some countries under the initiative of "the Belt and Road" had been growing well. However, the shipbuilding industry and the shipping industry had been depressed overall, and the market was locally recovered for a short time. In this context, the total number of maritime disputes in Zhejiang, which had grown rapidly for four years, decreased in 2016, by 19.7% on a year-on-year basis. However, it still ranked first among all maritime courts nationwide. For the whole year, in order to actively implement the edicts of President Zhou Qiang of the Supreme People's Court about the construction of an international maritime judicial center, Ningbo Maritime Court enacted specific implementation plans and expressly proposed the goal to become a maritime judicial organization in China that is first-class and influential in the world at the end of the "Thirteenth Five-Year Plan" to comprehensively promote China's establishment of an international maritime judicial center. In order to comprehensively summarize the experience in maritime trials, enhance the judicial credibility of this Court and make use of functions of typical cases newly accepted in regulation, advice and guidance for the shipping, portside and foreign trade industries, this Court has prepared the "2016 Maritime Trial Report of Zhejiang", and published it to the public in both Chinese and English via its official website, Weibo, WeChat and newspapers and magazines.

I. Basic Data about Maritime Trials in Zhejiang in 2016
The number of cases accepted for the whole year was 6,116 and the subject amount of the cases accepted was RMB 7.234 billion. The number of cases concluded for the whole year was 6,337 and the subject amount of the cases concluded was RMB 5.821 billion. The case conclusion ratio for the same period was 103.61%.
The number of newly accepted cases of first instance was 4,023, in which 4,007 cases had been concluded, a year-on-year decline of 23.39% and 18.87%, respectively. The number of newly accepted maritime administrative cases was 10, a year-on-year growth of 2.3 times.
The number of newly accepted cases where any parties were from other countries or from Hong Kong, Macao or Taiwan was 316, accounting for 7.85% of the cases of first instance. The number of cases concluded was 376; among others, the number of cases involving any parties from other countries was 220 and the number of cases involving any parties from Hong Kong, Macao or Taiwan was 156, a year-on-year growth of 81.8% and 220%, respectively.
The number of cases handled by judges per capita was 145 and the ratio of appealed cases which were reversed or set aside for retrial by the High Peoples Court of Zhejiang Province was 3.4%, a year-on-year decline of 17.8% and 7.6%, respectively. The conciliation and litigation withdrawal ratio was 57.72% and the self-fulfillment ratio in civil intermediation cases was 38.1%, a year-on-year growth of 5.1% and 14.1%, respectively.
The number of newly accepted enforcement cases was 2,093, a year-on-year decline of 11.4%; among others, the number of cases concluded was 2,320, a year-on-year growth of 9.5%. The number of enforcement cases accepted as transferred or commissioned by other courts was 235, the number of enforcement objection cases accepted was 52, a year-on-year growth of 28.4% and 70%, respectively.
The number of vessels arrested was 97 and the number of vessels for which auction (realization) transactions were concluded was 68; and the amount of transaction was RMB 608 million.
The number of various types of cases handled by three detached tribunals was 3,364 and the number of cases concluded by trial (enforcement) was 3,416, accounting for 55% and 53.9% of the number of cases accepted and concluded by this Court, respectively.

(I) Case Conclusion
    In 2016, the number of newly accepted cases by the Ningbo Maritime Court was 6,116 and the subject amount of the cases accepted was RMB 7.234 billion, a year-on-year decline of 19.7% and 32.1%, respectively. Among others, the number of newly accepted maritime commercial cases and maritime administrative cases of the first instance was 3,147. The number of newly accepted maritime special procedure cases was 876 and the number of newly accepted enforcement cases was 2,093. The total number of cases concluded ranked first among all maritime courts in China for a consecutive period of five years.
    The number of concluded cases of 7 types was more than 100, accounting for 77.4% of the total number of newly accepted cases. The number of seamen labor contract disputes decreased by 136 on a year-on-year basis, which, however, was still the type of disputes with the largest number.
    The total number of cases accepted decreased and the number of disputes relating to vessel mortgage, insurance, finance lease, salvage, collision and liability limitation significantly decreased, but the number of traditional maritime commercial disputes and cases of new types increased significantly. For instance, the number of disputes about vessel transactions, building and repair, disputes over contract for carriage of goods by sea, disputes over vessel lease and disputes of port work was 167, 234, 133 and 28, a year-on-year increase of 7.7%, 46.3%, 29.1% and 100%, respectively.
    In terms of special procedure cases, the number of newly accepted cases about the application for the establishment of maritime liability limitation funds was 3, a year-on-year decline of 62.5% and the number of cases about creditor's rights registration and rights affirmation litigation also decreased accordingly. The number of newly accepted death declaration cases arising from maritime accidents was 61 and the number of newly accepted cases about the acknowledgment of foreign arbitration awards was 6. There was 1 case about the identification of ownerless vessels and maritime properties as well as 2 cases of new types such as judicial sanctions.
    The number of newly accepted cases where one party or both parties were from other countries or from Hong Kong, Macao or Taiwan was 316, a year-on-year decline of 5.9%, accounting for 7.85% of cases of first instance.
The number of various types of cases newly accepted by the headquarters of this Court was 2,752 and the number of various types of cases handled by the three detached tribunals was 3,364, accounting for 45% and 55% of the total number of cases accepted by this Court, respectively.

 (II) Case Conclusion
    In 2016, the number of cases concluded was 6,337 and the subject amount of the cases concluded was RMB 5.821 billion, a year-on-year decline of 10.2% and 22.8%, respectively. The case conclusion ratio for the same period was 103.61%. Among others, the number of concluded maritime commercial cases and maritime administrative cases of first instance was 3,132. The number of concluded maritime special procedure cases was 875, a year-on-year decline of 15.6% and 28.8%, respectively; and the number of concluded enforcement cases was 2,320, a year-on-year growth of 9.5%. The average number of cases handled by each judge was 145, a year-on-year decline of 31.4.
    Among concluded cases of first instance, the number of judgments made was 1,183; the number of successfully conciliated cases was 1,278; the number of cases withdrawn was 558 and the number of cases handled by other means was 113. The conciliation and litigation withdrawal ratio was 57.72% and the self-fulfillment ratio in civil conciliation cases was 38.1%, a year-on-year growth of 5.1% and 14.1%, respectively. The number of cases with appeals after the judgment was made was 342 (including 53 cases with jurisdiction opposition appeals and 2 cases with appeals against the refusal of case accepted). The number of cases where judgments in the second trial were reversed in the second trial was 9, and the ratio of cases reversed or set aside for retrial by the second trial was 3.4%, a year-on-year decline of 7.6%, which was the lowest among all the years.
    The number of concluded cases where one party or both parties were from other countries or from Hong Kong, Macao or Taiwan was 376, and the case conclusion ratio for the same period was 118.99%. Among others, the number of cases with foreign parties was 220, involving 26 countries and regions including the United States, Japan, Korea, Singapore, Pakistan, Germany, UK, France, Italy, Denmark, Saudi Arabia, Liberia, Switzerland, Ireland, Panama, Marshall Islands, Malta, etc., and the number of cases with parties from Hong Kong, Macao or Taiwan was 156, a year-on-year growth of 81.8% and 220%, respectively.
    Among the concluded enforcement cases, the number of compelling enforcement cases was 1,489 and the number of self-fulfillment cases was 217, a year-on-year growth of 1% and 79.3%, respectively. The number of successfully conciliated cases was 33, a year-on-year decline of 34%. The number of cases that had been enforced by termination was 510, a year-on-year growth of 100%, and the number of cases that had been concluded by other means was 69, a year-on-year decline of 64.1%. The liquidation ratio of enforcement subjects was 24.1%, a year-on-year decline of 6.03%. The number of cases concluded per capita was 136.5, a year-on-year growth of 4.8.
    The amount seized and controlled was more than RMB 30 million. The amount of enforcement distributed via the "One Person, One Case, One Account" enforcement fund management system was RMB 345 million. The number of person-times of those subject to enforcement that were under surveillance and search was 12, the number of those subject to enforcement that were under judicial detention was 6 and the number of those subject to enforcement due to dishonesty that were exposed was 346.
The number of vessels arrested was 97; the number of real estate properties seized was 37 and the number of vessels for which auction (realization) transactions were concluded on the Internet was 68; and the amount of transaction was RMB 608 million.
In terms of the number of enforcement cases concluded, the Enforcement Tribunal of the headquarters of this Court had the largest number of cases, that is, 972, followed by the Zhoushan Tribunal, Taizhou Tribunal and Wenzhou Tribunal at 713, 486 and 149, respectively; and the ratio of the cases concluded by all three detached tribunals was 58.1%.

II. Highlights about Maritime Trials in Zhejiang in 2016
Five-year goal: To become a maritime trial organization that is first-class in China and influential in the world at the end of the "Thirteenth Five-Year Plan".
Published 6 issues of maritime trial white papers.
Opened an English official website.
Filed 20 cases on line and handled more than 200 cases in circuit trials.
Realized paper-free trial records of more than 85%.
Developed and modified 32 rules and regulations.
Parties in 7 cases were transferred to the public security agency for investigation of alleged fake litigation. 3 of them were sentenced to imprisonment due to fake litigation. 2 judicial punishment cases were established first to seriously punish violations against the litigation order.
Decided on 5 re-trial cases according to powers.
Selected 28 judges for the first batch.

(I) Specify Goals and Expand Influence
    Actively participated in the development of 21 plans for the construction of the international maritime judicial center and specified the five-year development goals. A regular annual white paper was issued along with another 5 ad-hoc white papers by the type of cases for the first time. Opened an English website and published 13 English cases and propaganda articles, etc. Added English table of contents and summary of contents to Forum on maritime jurisdiction, and prepared and distributed a special journal for typical cases for the 20th anniversary of the Wenzhou Tribunal.

(II) Make the Mechanism Smooth to Facilitate the People for Litigation
    Filed 20 cases successfully on the Internet for the first time. For parties in the 293 cases who had economic difficulties, allowed them to pay litigation fees late or exempted them from litigation fees fully or partially, totaling RMB 355,300. Handled more than 200 cases in circuit trials and 21 times in sea islands. Tried 902 cases with small-amount litigation procedures. Improved trial records with trial voice identity technology and replaced written records with audio and video recordings in more than 85% of the cases.

(III) Improved the System and Regulated Acts
    Adhered to the problem-oriented principle, focused on the demand for judicial reform and strict court governance, developed and modified 32 rules and regulations and basically formed a system that facilitates compliance, implementation and examination. Studied difficult problems about the exertion of maritime lien, whether the execution of a vessel can be required to be stopped without ownership registration and seamen labor disputes, and formed business norms.

(IV) Enforced Order and Manifested Authority
    The People's Court of Dinghai District, Zhoushan City sentenced 3 parties to imprisonment for fake litigation in vessel repairs with this Court, based on facts found by this Court, investigation by the public security agency and public prosecution. Transferred 7 cases with clear facts of alleged fake litigation about pays for employees of the vessels involved to the public security of agency for case filing and investigation. Imposed serious punishment on one party in each case who impeded the arrest of the vessel, moved the arrested vessel without permission or fabricated maritime litigation to enforce the litigation order and manifest judicial authority.

(V) Implemented Sunshine Justice and Accepted Supervision
    Published 36 trial videos of maritime cases with high social concerns on its official website. Published 3,430 judgment documents on China Judgments Online. Opened a WeChat account. Published 258 articles on news about this Court's work and trial status of this Court on national, provincial and municipal media.

(VI) Strengthened Learning and Enhanced Abilities
    Established a port business practice platform and organized the third batch of young judges to ports for practice. Organized 128 person-time for training on maritime laws and trial practice, held 9 lectures on knowledge about trial and enforcement work given by court and tribunal presidents, established a legal English learning team and organized 6 times of learning and accelerated the forge of a group of professional judges good at law, shipping and foreign languages.

III. Problems Found in Trials in 2016 and Corresponding Suggestions

(I) Problems Revealed in Maritime Administrative Litigation
    Since 2015, 16 maritime administrative cases had been accepted by this Court, including 8 administrative litigation cases and 8 non-litigation administrative enforcement cases. Causes of administrative litigation included the refusal of administrative punishment and administrative enforcement measures, request for the cancellation of maritime administrative registration and request for the performance of the legal obligation of information disclosure. Problems and disputes found in trials had gradually revealed. For instance, is Ocean and Fisheries Bureau a "maritime administration" as prescribed under the Rules of the Supreme People's Court on the Scope of Case Handling of Maritime Courts? Should any dispute arising from a specific administrative act of the Ocean and Fisheries Bureau be under the jurisdiction of a maritime court? Is a public security border defense organ a maritime administration? Should any punishments imposed by a public security border defense be deemed as a maritime administrative punishment? The foregoing questions have different answers. Besides, when examining a non-litigation maritime administrative enforcement case, upon the examination of the subject qualification of the administration, the legality of evidence materials, compliance and legality of applicable laws, procedure legality of the act subject to enforcement, legality of means of delivery and timeliness of the term of enforcement application, this Court found there were some aspects in maritime administrative enforcement that are irregular - for instance, the clause that a late fee that equals 3% of the fine shall be charged for late fine payment was not set forth in some administrative punishment decisions, which was not provided in subsequent procedures either, etc.
    Advice: The scope of "maritime administrations" shall be further specified with guidance cases or relevant work guidance opinions, so that the maritime court can fully exert its exclusive jurisdiction; causes of action for maritime administrative litigation cases of more complete types shall be determined according to the types of maritime administrative acts; a maritime administration shall ensure open procedures, perform the obligation of notification and keep relevant evidence.

(II) Some Acts that Undermine the Operating Order of the Shipment Market Shall Be Paid Attention to.
1. Some freight forwarding companies obtained consignments from shippers at prices lower than market prices, and then required the buyers to pay additional amounts on the pre-text of some fabricated entries after becoming the designated freight forwarders.
In 2016, this Court received consultation requests from some companies from other countries and from Yiwu, Cixi, etc., who told this Court that some bills of lading for goods to be exported were seized by some freight forwarder in Ningbo and requested a maritime injunction. As found by investigation, the goods involved in the case were shipped abroad from Ningbo Port. The shipper found on the Internet the quotation from a freight forwarder from Qingdao, Shandong was significantly lower than the market price and then commissioned such freight forwarder with the shipment of the goods. Then the freight forwarder commissioned the freight forwarder from Ningbo with space booking. Subsequently, the freight forwarder from Qingdao charged the freight and other expenses according to the commission contract. However, it did not pay the freight to the freight forwarder from Ningbo to receive the bill of lading; instead, it required the shipper to otherwise pay a "demurrage" of hundreds of US dollars each day as a condition for the delivery of the bill of lading. The freight forwarder from Ningbo argued that, it did not have any consignment relationship with the actual shipper and there were risks in the wrongful issuance and delivery of bills of lading. The term of delayed payment of freight prescribed by the shipping company was longer than that claimed by the freight forwarder from Qingdao and the freight forwarder from Qingdao required the shipper to pay a penalty for delayed payment, which are quite abnormal. Eventually, this Court granted a maritime injunction according to law and the freight forwarder from Ningbo delivered the bills of lading to the actual shippers . When the actual shippers received the bills of shipping, they advanced the freight to the freight forwarder from Ningbo.
Advice: A shipper shall try to find a decent freight forwarder and maintain necessary vigilance against any freight forwarder who offers a freight quotation that is significantly lower than the market price. Meanwhile, the shipper shall have better awareness of keeping evidence; when the freight forwarder charges any unreasonable fees without any just reason, the shipper shall get to know the whereabouts of the bill of lading from every possible source or apply for a maritime injunction with the court when necessary to safeguard its own rights and interests.

2. After the court successfully auctioned a vessel, the crew or shipbuilder refused to hand over the vessel
    As prescribed by Article 7 of the Provisions of the Supreme People's Court on Several Issues Concerning Applicable Laws to the Arrest and Auction of Ships, when a ship is being arrested, the owner or the bareboat charterer of the vessel shall be responsible for the management of the vessel. Where the owner or the bareboat charterer of the vessel does not perform its obligations for the management of the vessel, the maritime court may commission a third person or the maritime requesting party with the management instead. In this case, all expenses arising therefrom shall be borne by the owner or the bareboat charterer of the vessel or provisioned from the amount obtained from the auction of the vessel with priority. In 2016, this Court chose third-party custody companies for 39 arrested vessels by lucky draw. However, it is commonly seen that the owner of a vessel promises that it will be responsible for the custody in order to reduce the custody cost. It is also reasonable if the court decides to designate the shipyard to assist in the custody of the vessel when the vessel is under repair. In practice, the owners of some vessels responsible for the custody of the vessels maliciously confront the handover of the vessels by court, refuse to deliver the vessels together with their crew and refuse to follow the reconciliation by judges; some shipyards also refuse to deliver the vessels on the pretext that the parking fee is not settled, etc. In this case, this Court always turns to judicial detention measures to ensure the smooth handover of the vessels.
    Advice: The shipowner, the crew and shipyard of a vessel responsible for the custody of the vessel shall strictly follow the court's requirements for vessel seizure, actively cooperate with the court to hand over the vessel that has been sold by auction; any legal creditor's rights relating to the vessel shall be settled by litigation.

(III) Issues about the Way to Exert Rights by the Proprietor of a Vessel
1. Whether the application for vessel arrest is required for the confirmation of the maritime lien.
    In maritime trial practice, where a party requested the confirmation of the maritime lien without applying for the arrest of the vessel, the party would usually be required to file an application for the seizure of the vessel. Otherwise, the request for the confirmation of the maritime lien would not be supported. This added some litigation burden to some obligees, especially mariners who often change their workplaces. If the obligee applied for the arrest of the vessel at the same time, under the current situation where the market price of shipment has increased and the business of shipping companies has been growing to some extent yet with great debt pressures, small-amount debts might become "the last straw" that will break the shipping companies. To this end, this Court has been actively exploring the solution. When handling the case of (2015) Yong Hai Fa Shang Chu Zi No. 578 , this Court held that, the confirmation of the maritime lien should only be related to the maritime claim and should have nothing to do with the application for the arrest of the vessel; the claims for and exertion of the maritime lien might be separated from each other under certain conditions.
Advice: During the one-year preclusion period, the relevant obligee may choose to wait for the application for vessel arrested filed by the other party. Where the vessel is auctioned, the maritime lien may be confirmed later through the registration of creditor's right and affirmation of the right. The confirmation of the maritime lien and claims for the priority to the vessel are not required to be filed at the same time with a statutory time limit.
2. Whether the shipyard for a vessel can claim a lien on the vessel for any unpaid     repair fees incurred before based on its possession of the vessel
As prescribed by Article 25 of the Maritime Code of China, the possessory lien shall be extinguished when the ship builder or repairer no longer possesses the ship that he has built or repaired. And as prescribed by Article 231 of the Real Right Law of China, the chattels taken as lien by the obligee and the obligees rights shall fall into the same legal relationship, except for the lien between enterprises. Where both parties to the repair contract are enterprises, according to the Real Right Law, the lien could be claimed conflict between laws would arise therefrom. When trying the case of (2015) Yong Hai Fa Shang Chu Zi No. 365, the special provision about the lien on a vessel provided under the Maritime Code should prevail over the Real Right Law. Thus, when the shipyard possessed the vessel for the second time, the lien for the repair fees for the first time had been extinguished due to the termination of the possession.
Advice: Strengthen survey and research to solve law applicability conflicts and syn-position realization conflicts in vessel liens under the Maritime Code and commercial liens under the Real Right Law; and have more in-depth interpretations of the allocation order for vessel price through typical objection cases on allocation plans for funds from vessel auctions.
3. Issues relating to the situation where the actual owner of a vessel without     registration requested that the court stop enforcement procedures arising from any debt of the registered owner
    In 2016, enforcement objection cases tried by this Court frequently occurred between the registered vessel owners and actual vessel owners. When the registered owner of a vessel fails to perform its obligation as required under a valid judgment, the creditor would file an application with the court for the enforcement on the vessel of the registered owner and the actual owner would bring up objection, requiring that the court stop the enforcement, so that the auction of the vessel is impeded. The maritime court would reject the objection according to registration information about the vessel and at the same time inform the party that it could file litigation accordingly. The actual owner often files an action of enforcement objection as an outsider. Some actual owners may apply for re-trial or third-person cancellation suit according to the original judgment based on which the enforcement decision is made during the trial of the objection case. This route of litigation not only "detours" but also does not comply with the provision of "For an objection brought up by an outsider, if the outsider or any party objects the ruling made by court and believes the original judgment or ruling is wrong, the case shall be handled through the trial supervision procedures; where the original judgment or ruling is not involved, objection procedures shall be applied." under Article 257 of the Civil Procedure Law of China. Where the outsider expressly shows that it does not have any objection against the original judgment, its claims for right confirmation is supported by court and does not affect the enforcement effects of the original judgment on the disputed subject, the court should guide the outsider to choose re-trial procedures or file a third-person cancellation suit.
Advice: A uniform law or judicial interpretation shall be in place. For a vessel, a kind of special movable property, the effects to the public of ownership registration and announcement shall be safeguarded. Where the actual owner defends against a third person applying for the enforcement on the vessel, it shall prove that it is not a defaulting party to avoid fake registration. Where the vessels ownership has been determined under a valid judgment, after an objection brought up by the outsider, arguing that it is the actual owner of the vessel, is rejected, the outsider shall file an application for a re-trial on the original judgment according to law or file a third-party cancellation suit. It is not suggested that the outsider should file an objection suit.

(IV) Issues about the Increase of the Number of Maritime Disputes Where Port Enterprises Are Involved
    In recent years, the number of maritime disputes where port companies were involved had been increasing rapidly, up to 45 and 76, respectively, in 2015 and 2016. The disputes mainly included port construction contract disputes, salvage contract disputes, vessel crash damage liability disputes, port work disputes, etc. Causes of the disputes included the decline of economic situations both at home and abroad, as well as insufficient risk awareness of internal management of port companies and practitioners, such as keeping back or delaying the disclosure of any injuries or deaths due to maloperation of hoists or maritime disputes, which would cause the expansion of losses. To this end, it is generally suggested that port enterprises should strengthen the education about legal risk awareness, enhance business operating skills, develop uniform operating process guides and ensure risk prevention.
1. Issues about the lien on properties owned by non-debtors of port companies
The bankruptcy of Hanjin, the largest shipping company in Korea, triggered a wide discussion about the lien of port companies worldwide. As prescribed by the Real Right Law of China, the pre-requisite of the exertion of lien is the possession of movable properties of the debtor. Whether a port company is entitled to the lien of any containers leased by the debtor and goods under the custody as commissioned by a party that is not the owner is still disputed in practice. In the trial of the port work contract dispute of (2016) Zhe 72 Min Chu No. 1260 by this Court, the port company seized containers stored by a shipping company at the stacking site of the port company as the shipping company failed to pay the port work fee in time. During that period, there were a number of container lease companies that claimed that they were owners of the containers and would pick up the containers. After the container lease companies paid for the relevant expenses for the shipping company, the port company signed a container handover agreement with each container lease company. For containers that were not paid, the court supported the claims for lien of the port company.
Advice: Through judicial interpretations and guidance cases, the following practices should be promoted: A port company should have the right to possess the movable properties of the counterparty of the contract, so that the port company can not only claim the lien on containers against the counterparty of the contract as the vessel party, but also can claim the lien on goods against the counterparty of the contract as the goods owner.
2. Issues about the difficulties in safeguarding commercial interests due to the performance of governmental functions by companies
In a salvage contract dispute case tried and concluded by this Court in recent years (a port company from Zhejiang v. a shipping company from Shanghai), "Jinxinghai", a vessel owned by a shipping company from Shanghai, tilted when colliding with another vessel during unloading, and the deck was flooded. After receiving the report, the maritime authority ordered a port company from Zhejiang to save "Jinxinghai". However, each department alleged that the salvage was untenable and the salvage fee was too high. Although the court ruled that the salvage was tenable and supported part of the claims, disputes of this kind happened from time to time.
Advice: When a maritime or port administration orders or dispatches a port company for public interests or administrative management, it should make written instructions if possible, so that the port company can make a claim against relevant subjects; the Port Law of China and other relevant laws should be modified to coordinate in the cross-relations among different fields such as the Criminal Law, the Civil Law, the Administrative Law, etc. and specify the nature of permitted business of each port and the type of each port company.
3. Issues about hidden risks of losing a lawsuit arising from settlement through consultation
    In trial practice, it was commonly seen that a port company is in a passive situation as the port company failed to file a litigation on time, failed to identify the identity of the counterparty of the contract, did not pay enough attention to the collection and preservation of evidence, failed to examine the contents of the guarantee letter, etc. In a case tried and concluded by this Court, a port company required the shipping party provide a guarantee as a foreign ship touched the pier. When receiving the guarantee letter provided by the outsider, the port company did not notice that the guaranteed party under the guarantee letter was the bareboat charterer of the ship and the shipping party did not disclose the ID information of the bareboat charterer. Both parties failed to reach an agreement through negotiation. Finally, the port company had to file a litigation in a hurry when the prescribed period for litigation was about to expire. However, it was difficult for the port company to prove that the defendant was the bareboat charterer of the ship and thus fell into a passive situation.
Advice: All port companies should gradually develop a risk prevention mechanism consisting of legal risk information collection, risk assessment, pre-plan development, implementation of measures, result feedback, risk forecast, etc. When handling a dispute, pay attention to the reliability of the guarantee and the accuracy of the responsible party and try to choose the most effective solution.

IV. Outlook of Maritime Trial in Zhejiang in 2017

(I) Strengthen Connection Service for the Implementation of Major Maritime Economic Development Strategies
    At present, an all-round strategic layout for the full development and utilization of the ocean has been formed and the strategy of national development with the ocean, construction of the " the Belt and Road", construction of the Yangtze River Economic Zone, construction of the Zhoushan Free Trade Port Zone and River-Ocean Combined Transportation Service Center, construction of the Maritime Logistics Service Center in Ningbo Port, etc. are ongoing vigorously. The formation, implementation and realization of these strategies are not accomplished in one action; instead, they have been developing in an orderly and dynamic manner. This Court has been focusing on the position advantage and opening advantage of Zhejiang Province, carrying out surveys and researches actively, enacting policies to form orientation, handling cases justly according to law and trying to enhance its international influence in the maritime judicial field, which will definitely help with the creation of a good soft environment of rule of law that is just and open. This Court will have a bright prospect in extending its functions, overcoming difficulties and making every effort to achieve goals while continuously promoting the construction of the international maritime judicial center and providing the service for the implementation of the foregoing major strategies.

(II) The Total Number of Maritime Disputes May Remain Stable and Decrease to Some Extent
The number of cases received by this Court had dramatically increased to 7,614 in 2015 since 2012, and decreased to 6,116 in 2016. The decrease of the number of maritime disputes is mainly attributed to two aspects: 1. Maritime actions had absorbed a number of maritime disputes, where vessels of a lot of medium-size and small-size shipping companies had been disposed of through judicial auction by the courts and some shipbuilders had entered into bankruptcy, reorganization and liquidation. 2. The shipping market had been gradually recovered, the profitability of shipping companies had been enhanced, and the number of new disputes had decreased. Based on the above reasons and according to the current economic development situation, it is expected that the total number of maritime disputes in 2017 will remain stable and decrease to some extent.

(III) Maritime Administrative and Criminal Trial Is Facing New Opportunities and Challenges
The Rules of the Supreme People's Court on the Scope of Case Handling By Maritime Courts have been implemented for one year, and the maritime court has accumulated certain experiences in maritime administrative litigation. The Regulations of the Supreme People's Court on a Number of Issues about the Trial of Cases that Happen in Sea Areas within the Territory of China (I) and the Regulations of the Supreme People's Court on a Number of Issues about the Trial of Cases that Happen in Sea Areas within the Territory of China (II) implemented since August 2, 2016, highlighted the judicial ideology of protecting China's sovereignty in sea areas and ocean fishery resources, specifies that maritime cases arising from ocean ecological environment pollution and sea damage accidents should be handled by maritime courts and provides a good opportunity for maritime courts to further explore the handling of relevant administrative and criminal cases. The Supreme People's Court has designated relevant maritime courts for the pilot trial of maritime criminal cases and Zhejiang may get some experience therefrom. As vessels and mariners are highly internationalized and relevant facts happen in sea areas, it is difficult to fix evidence and the cases are likely to attract the attention of foreign parties, the trial of such disputes will impose brand-new challenges to maritime courts.
 
IV. Five Cases of Maritime Trials in Zhejiang in 2016
Case 1 : About the liabilities for compensation to be assumed by the carrier for goods recovered after release without the bill of lading and the liabilities for delayed pick-up of goods to be assumed by the holder of the bill of lading
[Details of the Case] Hetai sold a batch of goods to the buyer, a Polish company, which was shipped by Millennium in four containers. After the goods were shipped out, Hetai found out, by inquiry on the website of the actual carrier, that the four containers were all picked up and returned empty to the site. Then Hetai filed litigation against Millennium with the Ningbo Maritime Court in April 2015 for Millennium's release of the goods without the bills of lading, claiming for losses arising from the goods. During the action, Millennium sent a letter to Hetai, stating that it had recovered most of the goods via the destination port agent. In October of the same year, the Ningbo Maritime Court made judgments for the foregoing four cases, ordering Millennium to compensate Hetai for its losses arising from the goods that were not recovered. Hetai arrested the judgment and filed an appeal. The court of second instance concluded the case by intermediation with the following solution: Both parties accepted the judgment of the first instance; Hetai should pay Millennium the storage fee for the destination port and freight guaranty for the recovered goods and then pick up the recovered goods; the compensation and interest to be paid by Millennium should be deducted, fulfilled or enforced, etc. after the case for the destination port fee and ocean freight was concluded. On December 21 of the same year, Hetai picked up four batches of goods and resold them. The price of resale was 24% lower than the original price. Millennium then filed litigation according to the intermediation agreement, requiring that Hetai pay the ocean freight, inland freight, storage fees and relevant interests for the recovered goods. Hetai then filed a counterclaim, requiring Millennium compensate it for its losses arising from the price difference and interest of  the goods.
[Main Idea of the Judgment] In the trial, the Court found that the ocean freight in this case was paid at the destination, so that it should be paid by the party picking up the goods. Millennium had already recovered most of the goods after release without the bills of lading and delivered them and Hetai should assume the ocean freight under the bills of lading at the proportion of the value of the delivered goods. The destination port of each bill of lading involved in this case was Hamburg. The inland freight and customs clearance fees from Hamburg to Warsaw were caused by the release without bills of lading and thus should be borne by Millennium. Hetai picked up the goods in Warsaw and re-sold the goods and did not obtain more benefits therefrom. Thus, Millennium should not require Hetai to assume part of the inland freight based on this. The ocean freight, although agreed upon by and between the consignee and the agent of the carrier, the freight generally equaled the market price. Thus, Hetai, as the party picking up the goods, should assume it. The storage of the goods involved in this case in Warsaw was generated by the recovery of the goods after release without the bills of lading, which should not be assumed by Hetai. However, as it indeed reduced the storage fees in Hamburg, the Court supported Millennium's reasonable claims for the storage fee. About losses arising from the price difference of the goods, the price of the goods involved in this case, compared to the original trade price, had been declining all the time. During that period of time, the price was affected by both the release without the bills of lading by Millennium and Hetai's failure to pick up the goods earlier, as well as the negotiation between both parties about the pickup. Thus, the Court ruled that Millennium should assume 40% of the liabilities for the losses arising from price decline during that period of time.
[Typical Significance] The trial of this case involved the handling of issues about the carrier's release of goods without the bill of lading and recovery of the goods, and established some rules for the trial of cases of this type, including: 1. In the performance of an ocean freight contract, where the carrier releases the goods without the bill of lading and then recovers the goods, the holder of the bill of lading should pick up the goods according to law. 2. Inland freight, customs clearance fees, etc. arising from the release without the bill of lading should have nothing to do with the holder of the bill of lading and should be borne by the defaulting carrier. 3. As prescribed by Paragraph 3, Article 50 of the Maritime Code, losses arising from the price decline due to the delayed delivery of goods that have been released without the bill of lading should be assumed by the carrier. 4. Where the holder of the bill of lading refuses to pick up the recovered goods, as prescribed by Article 86 of the Maritime Code, it should also assume the corresponding storage fee. 5. Where the freight is paid at destination, the freight of the recovered goods should be paid by the holder of the bill of lading that picks up the goods.

Case 2 : A vessel runs down a foreign bare boat due to sudden power failure, and the insurer shall have the right of subrogation after it compensates the owner of the vessel
[Details of the Case] The ship "Hengrun" was a steel general cargo ship from Sierra Leone. The owners of the ship were Le and another person. The ship was leased to Shunxin (Hong Kong) for business and was registered as a bare boat. Le covered the ship with the insurer for all risks. The insurance value and insurance amount were both RMB 18 million. The insured was Le. On the evening of July 12, 2015, when heading for Pyeongtaek, Korea, "Hengrun" encountered "Wanli 8" from Ningbo in the Xiaobanmen sea area, which was heading for Kaohsiung, Taiwan and was owned by Shanglun Company of the defendant. The two ships agreed to pass each other with the red light on.
Subsequently, "Wanli 8" had power failure across the ship suddenly. After the power was resumed, the two ships crashed into each other and "Hengrun" sank. The goods carried by the ships were lost, and one person on board died and another person on board was missing. "Hengrun" filed claims with the insurer. The insurer commissioned an insurance survey and loss adjustment company for investigation and assessment. According to the survey and loss adjustment report, to buy a general cargo ship of the same type off the coast with necessary facilities that met the new Lloyd's requirements and was incorporated into the classification society, it would cost around RMB 9.625 million to 12 million. If the issue was handled by salvage and repair, the final expenses would be higher than RMB 12 million. In September 2015, Le and the insurer signed a compensation agreement and rights and interests transfer agreement, where it was agreed that, the insurer should pay Le RMB 12 million in three times as the insurance compensation. The insurer had already paid RMB 10.8 million for the first two periods. In January 2016, Shanglun Company applied for a maritime compensation liabilities limitation fund. The insurer claimed that Shanglun Company should assume 90% of the crash liabilities, pay insurance compensation of RMB 9.72 million and confirm the maritime lien on the ship . The focus of the dispute in this case was: "Hengrun" had been registered as a bare boat. So could the owner of the ship file claims with the insurer and transfer the right of claims? The ship that had sunk was not retrieved. The insurer reached an agreement on the amount of compensation with the insured according to the survey and loss adjustment report. So could the amount be deemed as the amount of the losses incurred in the accident?
[Main Idea of the Judgment] In the trial, the Court found that, the owner had the full ownership to the ship and of course had the right of claims when the ship was damaged or lost. Although the policy holder and the insured of the insurance contract was only Le, the owners of the ship were specified as Le and another person under the policy, which meant that both parties to the insurance for the ship were aware that Le acted on behalf of all owners of the ship and thus should have the right to transfer the right of claims for losses arising from the crash on behalf of all owners of the ship after receiving the compensation. "Hengrun" was not retrieved when it sank after crashing with the other ship. The salvage was indeed difficult. The amount needed for salvage and repairs determined by the survey and loss adjustment company upon price inquiry with many parties in a scientific and prudent manner was generally reasonable, and the amount was also less than that for the constructive total loss. Besides, the Shanglun Company did not have any counter-evidence to prove the loss assessment was unreasonable. Therefore, the Court supported the amount of compensation to be paid by the insurer, that is, RMB 12 million.
[Typical Significance] According to this case, when a bare boat was ran down, the owner of the ship shall have the right to file claims against the responsible party or file claims with the insurer and then transfer the right of claims for losses arising from the accident. As prescribed by Article 4 of the Regulations of the Supreme People's Court on a Number of Questions about the Trial of Disputes Arising from Ship Crash, liabilities for a ship crash shall be borne by the bareboat charterer. However, it is not specified that the right of claims for a ship crash can only be exerted by the bareboat charterer. If the defense of Shanglun Company was accepted, the litigation cost assumed by the damaged party, litigation procedures and vessel insurance practice would be significantly impacted. Take this case for example. The bareboat charterer from Hong Kong was not a party to the vessel insurance contract. If the dispute arising from the liabilities for ship crash could only be handled by the bareboat charterer, a large amount of litigation cost involving Hong Kong would be incurred. Then, as the bareboat charterer had already filed the litigation, if the owners of the ship filed claims with the insurer, a dilemma of double claims would occur. As the responsible ship owner had already applied for maritime compensation liabilities limitation, if the owner did not get insurance compensation, the insurer would be unable to participate in the allocation of the fund through creditor's right registration. After the fund was allocated, the responsible ship owner would be exempted from the liabilities accordingly and the losses not settled would have lost the protection under law. In this situation, the insurer would still reject the owner's request for compensation for the losses not settled accordingly. At last, it was meaningless for the owner to buy insurance for the ship registered as a bare boat. In this case, it was ruled that the owner should have the right to buy insurance for the ship and transfer the right of claims, which shows the support for foreign vessels funded by Chinese to buy insurance with the nearest insurers at home.

Case 3 : In the event that after the people's court handles the bankruptcy case of the debtor, the creditor declares the creditor's right with the court within the term of guarantee and the debt is not settled, the creditor can claim its right against the guarantor that assume joint and several guarantee liabilities.
[Details of the Case] In December 2012, the plaintiff Huarong Company as the leaser, and Xinwei Company as the lessee, signed a financial lease contract. The subject of the lease was a CCS-grade general cargo ship 67000DWT with non-restricted waters. In order to fulfill the lease contract, Huarong was signing a shipbuilding contract with another company. In the same month, Zhenghe Company was signing an agreement on the issue of a guarantee letter with the defendant Dinghai CCB, where it was agreed that Zhenghe filed a request that Dinghai CCB should issue a guarantee letter for the refund of vessel advances with a guarantee of RMB 179.2 million, with Huarong as the beneficiary. Subsequently, Dinghai CCB issued a guarantee letter to fund the vessel advances, where the beneficiary and validity terms were set forth. Later, Huarong paid the advances for shipbuilding for the first three periods as agreed upon. However, Zhenghe failed to deliver the vessel in time and its financial status had been deteriorated. In June 2015, Dinghai Court handled the application for bankruptcy and reorganization filed by Zhenghe. The building of the vessel was not completed and had been stopped and the vessel did not meet the conditions for delivery. During the bankruptcy and reorganization, Dinghai CCB declared a total creditor's right of RMB 1,154,515,279.51 including the guarantee letter involved in the case with the bankruptcy receiver. In September of the same year, Huarong issued letters to Zhenghe and its bankruptcy receiver, requiring them to return the advanced amount and interest for the shipbuilding involved in the case and then issued a notice of claims to Dinghai CCB. In December of the same year, Huarong filed litigation with the Ningbo Maritime Court, requesting the confirmation of the validity of the guarantee letter for the refund of the advance for the vessel and the judgment that Dinghai CCB should immediately compensate it for the advanced amount for shipbuilding of RMB 134.4 million and the corresponding interest. Dinghai CCB argued that, the guarantee letter for refund involved in the case and the supplementary agreement should be deemed as invalid; Huarong and Zhenghe colluded with each other maliciously to defraud the guarantee letter for the refund of the payment for the vessel; Huarong failed to exert its right to supervise shipbuilding under the contract, and did nothing about Zhenghe's improper contract performance - instead, it tried to be compensated with the guarantee letter to transfer the market transaction risk; Huarong had already declared its creditor's right in full with the bankruptcy receiver for the advanced amount for shipbuilding of RMB 134.4 million involved in the case, the bankruptcy procedures were not concluded for the time being, and the trial of the case should thus be suspended.
[Main Idea of the Judgment] In the trial, the Court found that, all parties to this case acknowledged that the shipbuilding contract, finance lease contract, agreement on the issue of a guarantee letter, fund supervision agreement and guarantee letter for the refund of the advance for shipbuilding were authentic. Thus, Huarong should have the right to require Dinghai CCB perform its obligation of refund as agreed under the guarantee letter. Dinghai CCB argued that the guarantee letter was invalid but failed to provide valid evidence to prove it. Thus, the Court did not support such argument. The way of guarantee agreed upon under guarantee letter for the refund of the advance for the shipbuilding was joint and several guarantee. According to law, the creditor should have the right to require the debtor fulfill the debt or require that the guarantor assume the guarantee liabilities within the scope of guarantee. Thus, Huarong should have the right to file claims directly against the guarantor of Zhenghe, that is, Dinghai CCB. Though the creditor's right in this case had been declared with the bankruptcy receiver in full, Huarong expressly stated that, if it got the compensation, it would agree to transfer the creditor's right within the scope of settlement to Dinghai CCB. Huarong should not get double compensation. To sum up, the claims filed by Huarong was tenable.
[Typical Significance] This case is of great typical significance about how a debtor should, after entering into the bankruptcy procedure, handle the situation where the creditor claims joint and several guarantee liabilities with the guarantor independently, including: 1. As prescribed by Article 44 of the Interpretations of the Supreme Peoples Court of a Number of Questions about the Applicability of the Guarantee Law of the Peoples Republic of China, a creditor is not prohibited from claiming joint and several guarantee liabilities with the guarantor after declaring the creditors right; 2. The guarantee liabilities of the guarantor shall not be terminated upon the registration and settlement of the creditors right, and only when the creditor has obtained the payables under the creditors right, the creditor's right should be terminated. 3. Where the creditor declares its creditor's right with the court but the debt is not settled, and the creditor agrees to transfer the creditor's right within the scope of settlement to the guarantor, the court may support such claims filed by the creditor, and order the guarantor to assume the guarantee liabilities to the creditor.

 
Case 4 : Where the carrier seizes some goods, claiming any fire is caused by the goods, the carrier should provide valid evidence to prove the cause of the fire.
[Details of the case] In February 2014, Mingding Company signed a Sales Contract with Dongsheng Company, for purchasing a batch of bulk waste hardware electrical appliances. In March of the same year, the agent of the ship issued a bill of lading on behalf of the carrier Fengyuan Company, one of the defendants. On the bill of lading, the shipper was Dongsheng, and the consignee and notified party were both Mingding. The name of the ship was "Yongshun". The loading port was Osaka, Japan, and the loading port was Ningbo, China. The registered owner of "Yongshun" was Fengyuan, and the party responsible for the operation and management of the ship was Ruihai Company, one of the defendants. On March 16, 2014, when heading for Ningbo Port, "Yongshun" smoked and caught fire. On the afternoon of the next day, the fire was completely put out.
Ruihai then filed claims against Mingding, claiming that the goods got ignited on their own so that the cabin was on fire. Mingding then required the shipping party to deliver the goods immediately and assume the losses arising from the delayed delivery. Both claims were not settled. On April 18 of the same year, "Yongshun" moored along Ningbo Port to unload the goods. The goods involved in the case were stored in a stacking site in Ningbo Port. Mingding paid the site lease and goods stacking fee to the outsider in order to process and use the imported waste metal. As no agreement was reached upon consultation, Mingding filed the dispute with the Court, requiring the Court to order Fengyuan and Ruihai deliver the goods immediately, or compensate it for its losses if they were unable to deliver the goods.
[Main Idea of the Judgment] In the trial, the Court found that, about the cause of the fire, though Ruihai claimed that the shipping party suffered the losses due to the self-ignition of the goods, Ruihai failed to provide valid evidence to prove it. Thus, Ruihai did not submit sufficient evidence for its defense and such argument was thus untenable. About the responsible subject.Fengyuan was the carrier of the goods shipped on the sea. Ruihai was the party responsible for the operation and management of "Yongshun", the ship carrying the goods, and was engaged in the seizure of the goods involved in the case and handled the provision of guarantee, compensation, etc. about the release of the goods with Mingding and other related parties. The illegal seizure of all the goods under the bill of lading involved in the case by the two defendants constituted contributory infringement. Thus, the two defendants should be liable of or jointly compensate for reasonable losses arising therefrom. About the identification of losses, Mingding leased a site for the dismantling of the imported waste metal electrical appliances involved in the case and actively handled the entry of the subsequent goods to mitigate the losses that kept growing. The rent for the lease might be determined by reference to the frequency of import by Mingding and the proportion of the goods involved in the case to the goods to be dismantled imported in a whole year. The storage fee at the pier was incurred by the illegal seizure of the goods involved in the case and the amount was generally reasonable; thus, such amount was supported by the Court.
[Typical Significance] This case is of great significance about how to examine a carrier's claim that a fire was caused by the goods and in this case whether the carrier has the right to seize the goods on board accordingly. First, the shipping party's seizure of goods must meet certain statutory conditions. As prescribed by Article 87 of the Maritime Code of China, if the freight, contribution in general average and the demurrage to be paid by the debtor to the carrier and other charges advanced by the carrier for the goods have not been paid in full, nor has appropriate security been given, the carrier may have a lien, to a reasonable extent, on the goods; except under the foregoing situation, the shipping party shall have no right to have a lien on the goods on board. Second, about providing the cause of fire, in this case, the shipping party claimed the lien on the goods, claiming that it suffers losses due to the self-ignition of the goods. Thus, the shipping party should prove the fire was caused by the goods. However, the shipping party failed to provide valid evidence to prove that it had reported the accident to the competent authority or any other valid evidence to prove the cause of the accident. Thus, the shipping party should bear the adverse consequence for the failure to satisfy the burden of proof. Besides, the carrier and the goods owner in this case failed to reach an agreement upon negotiation and both parties were suffering increasing losses. At that time, the goods owner applied for a maritime injunction with the maritime court after providing sufficient guarantee, requiring the shipping party to deliver the goods first and then file litigation in this case. It meets the principle of economic benefits and helps reduce losses and settle disputes.

Case 5 : In the event that a mooring rope is broken by a backing ship, the port operations company, the employer of the workers and the pier operator shall be liable proportionally according to their faults, respectively.
[Details of the Case] Tian was an employee of the outsider Zhenghe Company. Zhenghe and the defendant Xingfa Company were affiliated companies. The defendant COSCO Zhoushan, signed a safety and environmental protection responsibility agreement and a sales contract for waste steel removed from foreign ships under repair with Xingfa. Subsequently, Xingfa reached the ship "Jingpeng 69" via an agency to ship the waste steel involved in the case. The ship was owned by defendant Hengpeng Company and leased by Huachen Company as the bareboat charterer. In June of the same year, Tian hoisted and loaded the waste steel at No. 9 Pier of COSCO Zhoushan for Xingfa as designated by Xingfa. At around 18:40, after a truck of waste steel was loaded onto "Jinpeng 69", the ship backed to continue hoisting waste steel and made a mooring rope on the a bit of the pier bounce up. Tian, who was standing and operating outside the guard bar, was knocked down and his safety helmet was knocked away. Tian fell down hitting the back side of his head and got injured. He thus suffered a mental disorder (mild) due to the injury in his head, which was recognized as a grade-8 disability in the human bodyaccident ; and he also suffered brain damage and other injuries, which were collectively recognized as a grade-8 disability in the human body. The hoisting of the waste steel was operated by Xingfa. Before "Jinpeng 69" backed out, no notice was sent to the operator on the pier and the front mooring rope was not unfastened from the bitt. In the litigation, Zhenghe was still handling claims for compensation for work-related injuries. Tian filed litigation with the Court, requiring the Court to order each defendant to compensate him for medical expenses, disability compensation, etc., totaling more than 630,000, and to confirm the maritime lien on the ship.
[Main Idea of the Judgment] In the trial, the Court found that, Tian was sent by Zhenghe to the site involved in the case to engage in the fastening and unfastening of lifting hooks. He wore the safety helmet as required at work and had given due care for safety. Tian was standing outside the guard bar to perform his duty for the fastening and unfastening of the lifting hooks. There were no warning signs on the pier to tell anyone not to stand outside the guard bar. Thus, Tian was not at fault in the case. The driver of Jinpeng 69 should notify those working on the pier before backing. The drivers negligence caused the accident involved in the case. Thus, 30% of the legal consequence should be assumed by Huachen, the bareboat charterer of Jinpeng 69. Hengpeng did not have any fault in the accident involved in the case. Xingfa, as the company purchasing the waste steel involved in the case and employer of Tian, failed to provide Tian with relevant safety and protection education and training, and did not send anyone to take charge of onsite safety management during the hoisting of the waste steel. Thus, Xingfa should assume 40% of the liabilities. COSCO Zhoushan, as the owner of the pier involved in the case, should be responsible for the management of the pier involved in the case. While knowing the purpose of the pier involved in the case was not designed for the loading and unloading of waste steel, it still used the pier involved in the case for the loading and unloading of waste steel and did not carefully examine whether Xingfa had the production conditions for the hoisting of waste steel, etc. Thus, COSCO Zhoushan should assume 30% of the liabilities.
[Typical Significance] The judgment in this case involved how to determine the infringement liabilities to be assumed by each party when a worker operating on a pier gets injured accidentally, including: 1. The worker shall only be responsible for giving basic due care for safety. Although there was a guard bar on the site where the accident happened, there were no warning signs or notes. According to the position and height of the guard bar, it was more likely to be designed for preventing the worker from falling into the sea instead of warning the worker that no one should stand outside the guard bar. Thus, the worker did not have any fault for his injuries when he stood outside the guard bar. 2. The employer should provide necessary training, education and onsite management properly and provide work conditions required for safe production. If the employer failed to perform the above obligations, it should have significant fault in the occurrence of the accident involved in the case. 3. The owner and operator of the pier should be responsible for examining whether the pier user met the conditions for safe production and had relevant qualifications; otherwise, they would be liable for the accident in production safety accordingly.

 

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